CMC 2024 Sustainability Report
  1. Environmental
  2. Environmental Stewardship
  3. Energy & Climate
energy efficiency tab

Energy & Climate

  • 3-3 Management of material topics

CMC’s industry-leading performance in energy intensity is thanks in a large part to the energy-efficient EAF technology we use in melting and producing steel, compared to the BF/BOF process used by traditional integrated steel producers. Both our mini mills and micro mills use 100% recycled scrap steel when making steel, which requires significantly less energy than a BOF and fully embraces the concept of the circular economy.

Our micro mills are some of the greenest steel mills in the world and take energy efficiency to the next level thanks to their continuous manufacturing process that eliminates the need for burning natural gas in a reheat furnace, resulting in significant reductions in energy use and GHG emissions. We started up our first-of-its-kind micro mill in 2009 in Arizona and followed that with two additional micro mills, one in Oklahoma in 2018 and another in Arizona in 2024. We are building our fourth micro mill in West Virginia, which is expected to start up at the end of calendar 2025.

All of CMC’s steel mills, including our seven mini mills, are strategically located close to our customers to minimize shipping distances, helping to reduce transportation fuel usage and resulting GHG emissions. We also prioritize efficiency in logistics, striving to ensure that trucks never travel empty.

Since 2019, we have reduced our energy consumption intensity by 6.5%

Energy Consumption Intensity

82%

less than the industry average

Energy Intensity

(GJ/MT)

CMC 2024 Industry Average¹

1 Industry averages taken from the latest World Steel Association published indicators 2020 data.

Goal

Decrease our energy consumption intensity by 5%

Energy Intensity (GJ/MT)

We have decreased our energy consumption intensity by 6.2% since 2019, surpassing our goal. We are proud of our progress to date and plan to continue reducing our energy consumption to progress toward a more sustainable future.

Current Progress Towards Goal

2024 2023 2022

Results

6.2%

decrease
since 2019*

*Based on 2019 baseline value of 4.020 GJ/MT.

Innovating with Q-One Power Technology

In 2022, CMC Steel Arizona began using the Q-One power system for its ladle metallurgical station at the AZ1 micro mill.

Q-One technology is configured to accept renewable energy right from the source, a critical attribute as CMC looks to increase the use of renewables across our steel mill power systems. Q-One reduces electricity transmission losses by up to 10%, leading to the more efficient use of generated electricity.

AZ1 served as a test platform for future micro mills. Since Q-One has proven to reduce power and electrode consumption, retain high power and provide renewable energy, we selected the technology as the power system for the EAF and ladle metallurgical station at AZ2, which began operations in Spring 2023. Looking ahead, we will work to expand Q-One usage as we build more micro mills.

Energy Improvements in 2024

While our EAF technology provides inherent energy efficiency, we continue to implement innovative technologies and process improvements at our mills that drive business performance and help to achieve our Scope 1 and Scope 2 emissions reduction goals. Among these initiatives are selecting lower impact recycled steel for use as raw material; utilizing energy-efficient equipment; configuring automatic controls to increase efficiencies; analyzing data to prevent performance issues; and exploring new technologies to further reduce our use of natural gas.

Some examples of our efforts in 2024 include:

  • At our mini mills, we are utilizing a hot charging process where hot billets from the steel melt shop are transferred directly to the rolling mill, significantly reducing the use of the reheating furnace. We estimate that this process reduces natural gas usage by up to 50% per ton.
  • CMC Poland setting all-time records for low electrical energy consumption for EAF.
  • CMC Steel Florida optimizing electrical and chemical energy recipes in their EAF to maintain production rates and reduce energy consumption.
  • CMC Steel Tennessee and CMC Steel Arizona 1 replaced their EAF arc regulation systems, which directly control the electrical energy input, resulting in an improvement in reliability and electrical energy consumption.

We are investigating additional innovations to further improve our business and reduce emissions, including those that further electrify our operations and those that move us away from natural gas. Among the innovations we are analyzing are using electric ladle preheaters to replace traditional natural gas-fired ladle preheaters; using electric induction furnaces in our mini mills with reheat furnaces to replace natural gas-fired reheat furnaces; and using hydrogen as a partial or full replacement for natural gas.

We are also engaging with our energy suppliers and utilities to reduce Scope 2 GHG emissions by optimizing the mix of our sources of power, including increasing the use of renewable energy. By diversifying our power supply, we ensure reliability and reduce price risks while reducing our carbon footprint. These efforts include negotiating purchase power agreements (PPA) to increase the amount of purchased energy from renewable sources. In 2024, we entered into a new PPA with Alabama Power, which will result in our steel mill in Birmingham, AL sourcing 16% of its electricity from renewable sources.

We are also implementing innovative technologies to enable our mills to use greater amounts of renewable energy. CMC Steel Arizona is using Q One technology at its micro mills, which reduces electricity transmission losses by up to 10%, and this same technology will be utilized at our future micro mill in West Virginia.

Energy Consumption

  • 302-1 Energy consumption within the organization
  • 302-3 Energy intensity
  • 302-4 Reduction of energy consumption
Metric Unit 2024 2023 2022
Total Energy Consumption GJ 20,545,656 21,070,560 22,056,632
   Natural Gas Consumption GJ 8,086,247 8,329,192 8,482,268
   Diesel Consumption GJ 460,483 622,954 834,090
      Facility Diesel Consumption GJ 43,707 185,000 392,078
      OTR Diesel GJ 416,776 437,954 442,012
   Electricity Consumption GJ 11,955,219 12,118,414 12,740,274
Total Energy Intensity GJ/MT 3.76 3.89 3.83
Renewable Electricity Consumption % 24.3% 22.8% 23.2%
Renewable Energy Consumption % 14.2% 14.1% 13.4%

Goal

Increase our renewable energy
usage by 12 percentage points

Percent Renewable Energy Usage (%)

Since 2019, we increased the percentage of our total energy usage that comes from renewables from 7.1% to 14.2%; this is a 100% increase in renewable energy usage.

Current Progress Towards Goal

2024 2023 2022

Results

100%

increase
since 2019*

*Based on 2019 baseline value of 7.1%.

Transitioning Our Energy Mix

  • 302-4 Reduction of energy consumption

Process efficiency and technology can’t mitigate all GHG emissions. The sourcing and mix of our energy supply plays a critical role in our carbon footprint. That’s why CMC continually investigates and implements new energy sourcing options that better serve our business and our customers, including the use of renewable energy sources.

At the same time, we work with our suppliers to minimize indirect energy use at our facilities. Our energy teams strive to:

  • Ensure we have an adequate and reliable supply of power
  • Diversify our sources of power
  • Secure the economic purchase of renewable power

We’re also continuing our transition toward more renewable power across all operations. Our strategy of expanding energy supply options helps mitigate supply uncertainty, price risk and environmental impacts. This effort is exemplified by our recent work toward securing a Virtual Purchase Power Agreement (VPPA) for our Steel Alabama site, which is scheduled to begin in 2025. The VPPA will allow our Alabama site to consume up to 12% of its annual energy consumption from a local solar farm.

In 2023, we enhanced our strategies for supplying electricity and natural gas to our mini and micro mills. The goal was to address all facilities’ energy requirements based on their activities, location and demand. To accomplish this, our procurement teams are engaging more directly with suppliers and utilities and working to balance the price and the reliability of the energy source—ensuring we retain clean energy at the right price that will guarantee consistent power to our operations, even in extreme weather.

GHG Emissions Intensity

Scope 1-3

64%

less than the industry average

Greenhouse Gas Emissions

(MT CO2e/MT)

CMC 2024 Industry Average¹
0.43
(Scope 1-2)
0.30
(Scope 3)
1.9
(Scope 1-3)

1 Industry averages taken from the World Steel Association indicators data

Scope 1, 2 & 3 GHG Emissions

  • 305-1 Direct (Scope 1) GHG emissions
  • 305-2 Energy indirect (Scope 2) GHG emissions
  • 305-3 Other indirect (Scope 3) emissions
  • 305-4 GHG emissions intensity
  • 305-5 Reduction of GHG emissions
Metric Unit 2024 2023 2022
Scope 1 GHG Emissions MT CO2e 1,038,806 1,056,191 1,082,528
   Scope 1 GHG Emissions Intensity MT/MT 0.20 0.20 0.19
   % of CO2e Covered Under Emissions-limiting Regulations % 7.23% 4.27% 3.88%
Scope 2 GHG Emissions MT CO2e 1,215,332 1,232,430 1,297,667
   Scope 2 GHG Emissions Intensity MT/MT 0.23 0.23 0.26
Scope 1 & 2 GHG Emissions MT CO2e 2,254,138 2,288,621 2,380,195
   Scope 1 & 2 GHG Emissions Intensity MT/MT 0.42 0.42 0.41
Scope 3 GHG Emissions MT CO2e 1,615,509 1,387,937 1,450,639
   Scope 3 GHG Emissions Intensity MT/MT 0.30 0.26 0.25
Total GHG Emissions (Scope 1, 2 & 3) MT CO2e 3,869,647 3,676,558 3,830,834
   Total GHG Emissions Intensity (Scope 1, 2 & 3) MT/MT 0.73 0.68 0.67

Goal

Decrease our Scope 1 & 2
GHG emissions intensity by 20%

Scope 1 & 2 GHG Emissions Intensity (MT CO2e/MT)

We steadily decreased our Scope 1 and 2 GHG emissions intensity by 12.3% since 2019. Our mills are continuing to investigate new ways to further improve efficiency in order to reduce emissions intensity.

2024 2023 2022

Results

12.3%

decrease
since 2019*

*Based on 2019 baseline value of 0.479 MT CO2e/MT.

Energy Reduction in Melt Shops

The melt shops in our mills, where recycled scrap steel is melted to use as a raw material for our products, are our largest user of electricity.

Our initiatives to reduce the electricity usage in the EAFs and ladle metallurgy stations in the melt shops resulted in a savings of approximately 15.2 million KWH and $762,000 in 2024. Other efforts include optimizing the amount of carbon injected into the EAF; reducing the consumption rate of the carbon graphite electrodes used in the EAF; and optimizing the amount of fluxes used in the EAF, which are used to reduce metallurgical impurities in the scrap steel.

Micro mills: a cutting edge technology

The micro mills represent the most cutting-edge technology designed for efficient and environmentally friendly steel production.

“The micro mills represent the most cutting-edge technology designed for efficient and environmentally friendly steel production. At CMC, we’ve implemented the latest advancements in data collection, analysis and optimization to elevate micro mill performance significantly. Our analysis at AZ1 pinpointed the operation segments most closely linked to elevated energy consumption, enabling our process experts to develop modified practices that improve energy efficiency and also achieve lower emissions. CMC now uses this approach at all of our operations including mini mills and recycling in order to empower each of our employees to review their process data and generate ideas on how to improve.”

Sam Matson
Director of Manufacturing Excellence