Report: Indiana should decarbonize steel and aluminum facilities to protect Hoosier jobs

Hoosier jobs may be at risk if the state’s steel and aluminum industries do not pivot to low-carbon metals, a report found.

Indiana is home to more than a quarter of U.S. steelmaking capacity and one of only five remaining U.S. aluminum smelters. Many major manufacturers have committed to reducing emissions but most are still powered by fossil fuels, particularly coal.

A new report from the American Council for an Energy-Efficiency Economy, a nonprofit research organization, found that the industry is at risk of losing their “competitive edge” unless they pivot to using low-carbon metals.

Steel manufacturing employs nearly 28,000 people in Indiana. Automotive companies — some of which have plants in Indiana — have pledged to achieve carbon neutrality between 2038 and 2050. This will require Indiana to decarbonize its facilities that make steel and aluminum or force automakers to purchase low-carbon metals made in other states.

“The auto industry is shifting to low-carbon metals, and that’s not what Indiana produces right now. Indiana is at risk of losing jobs if automakers have to turn to other states for the steel and aluminum they need to make cars. Now is the time when policymakers have a chance to help the state’s steel and aluminum industries transition to new processes, so their products remain competitive for the future,” said Anna Johnson, senior researcher in ACEEE’s industry program and lead author of the report.

More than $80 billion in federal funds are available over the next decade for industrial decarbonization, including $10 billion in tax credits for facilities that reduce carbon pollution by at least 20%, $6.3 billion for energy-intensive industrial facilities to reduce emissions and $2 billion for low-carbon materials used in federally funded transportation projects.

Facilities in other states are already beginning to decarbonize the metal-making process by replacing fossil fuel gas with hydrogen.

“Indiana is again at risk of losing good-paying manufacturing jobs if we fail to decarbonize our industrial facilities by powering them with renewable energy,” said Ben Inskeep, program director of Citizens Action Coalition. “The good news is that billions of dollars in federal incentives are already available to help upgrade these facilities, which would protect Hoosier jobs and our economy.”

The report recommends that Indiana invest in low-carbon metal manufacturing at the scale needed to meet the demands of major automakers and other manufacturers. Indiana could also benefit from a well-trained clean energy workforce for industrial facilities. Policymakers should collaborate with aluminum and steel industries to develop a coordinated strategy, the report said.

However, local restrictions on wind and solar generation pose a significant challenge to shifting Indiana’s metals to renewable energy. More than ⅓ of Indiana counties have passed ordinances blocking future wind energy investment. Meanwhile, eight other counties completely prohibit wind energy generation. Protecting industrial jobs in Indiana will likely require less restrictive policy toward wind and solar energy, the report said.

View the full report at aceee.org

Contact staff writer Jayden Kennett at 317-762-7847 or by email [email protected]. Follow her on Twitter @JournoJay.