As Beijing and neighboring cities suffer from smog, Hebei Province fired the first shot of 2014 in eliminating outdated capacity and curbing pollution. Hebei concentrated on dismantling 16 blast furnaces and 3 converters at 15 steel enterprises, cutting ironmaking capacity by 6.71 million tons and steelmaking capacity by 1.49 million tons.

 

　　Private steelmakers are the first choice for furnace dismantling

 

　　On the morning of February 23, under the unified deployment of the Hebei Provincial Government, 16 blast furnaces and 3 converters at 15 steel enterprises in five prefecture-level cities—Tangshan, Handan, Qinhuangdao, Xingtai and Zhangjiakou—were dismantled in a concentrated action, cutting ironmaking capacity by 6.71 million tons and steelmaking capacity by 1.49 million tons. Through this concentrated action, coal consumption can be reduced by 4.06 million tons per year, sulfur dioxide emissions by 9,700 tons, and smoke and dust emissions by 7,000 tons.

 

　　The blast furnaces dismantled this time in Hebei mainly target small and medium-sized private steel enterprises. In this regard, Zhang Lin, an analyst at Lange Steel Network, said in an interview with Securities Daily, "Hebei will certainly reduce capacity according to the standard of 'eliminating the inferior and keeping the superior,' such as furnace volume and whether environmental protection standards are met. The main targets are still those small and medium-sized steel enterprises. Usually, small-scale steel plants have relatively low levels of technology, equipment and management, which are inconsistent with the major national economic development policies such as the scientific outlook on development, structural adjustment, energy conservation and emission reduction, and a low-carbon economy. In fact, before 2013 there were production cuts and shutdowns, but all of them were shutdowns of rolling mill production lines, while crude steel output remained high. That cannot be regarded as a real production cut. Reducing capacity by dismantling blast furnaces is the most obvious and direct way to cut steel capacity—that is, with less hot metal, crude steel naturally decreases, and finished products are reduced accordingly."

 

　　The property rights issue of the dismantled blast furnaces is also worth attention. The reporter learned that some blast furnaces are mortgaged to banks, and if these blast furnaces are to be dismantled, handling property rights cannot be avoided. Liu Haiming, director of the Metallurgical Industry Economic Development Center, said in an interview with this newspaper, "The property rights issue cannot be bypassed and must be dealt with directly. Local governments must have thought of this. For those blast furnaces mortgaged to banks, if they are to be dismantled, I think the government will certainly step in and give steel enterprises some compensation. Moreover, capacity reduction cannot be completed in one step. In the process of reducing production, some problems will certainly be involved, and the government and enterprises still need to negotiate and solve them."

 

　　HBIS is confident it has "clever measures" for smog control

 

　　As is well known, Hebei is China's largest steel province, and Hebei Steel also used the action of cutting 8.2 million tons in one day at this critical moment to demonstrate its determination to "prioritize environmental protection and reduce capacity." On November 24 last year, Hebei concentrated on dismantling 10 blast furnaces and 16 converters at 8 steel enterprises, reducing ironmaking capacity by 4.56 million tons and steelmaking capacity by 6.8 million tons, firing the first shot in resolving overcapacity. Together with the equipment dismantled in this action, a total of 60 blast furnaces and 60 converters and electric furnaces have been dismantled, cutting ironmaking capacity by 20.56 million tons and steelmaking capacity by 23.25 million tons. This can reduce coal consumption by 12.43 million tons per year, sulfur dioxide emissions by 33,500 tons, and dust emissions by 24,200 tons—toxic dust and gases that were originally discharged into the air.

 

　　Hebei Province's action deployment this time is undoubtedly a "shot in the arm" for smog control. It can be seen that Hebei Province has indeed put in "effort" in environmental protection and production reduction. Li Buhai, board secretary of Hebei Steel, told the reporter that none of the blast furnaces dismantled this time belonged to the Hebei Iron and Steel Group, and all of the company's facilities meet national environmental protection standards.

 

　　The reporter noticed on the official website of HBIS Group that its subsidiary Hansteel began promoting the "oil-to-gas" conversion of transport vehicles in November 2013, under the unified management of the manufacturing department, which formulated conversion and commissioning plans, put "yellow-label vehicles" that fail to meet emission standards on a regulatory "blacklist," and did not allow them to participate in transporting raw materials and fuel into Hansteel or steel products out of the plant. At present, Hansteel has implemented 378 gas-powered vehicles, with 358 put into operation.

 

　　Moreover, Hansteel has also used its brains in power generation. Over the past year, Hansteel's "green power generation" reached a new high, with cumulative power generation of 3.4 billion kWh. Cao Yanshuang, a technician at the thermal power workshop of the Energy Center of Hansteel, Hebei Iron and Steel Group, said, "We recover all waste gases such as coal gas generated in the steel production process for power generation, which not only reduces production costs but also protects the environment." According to the reporter's calculation, based on 350g of standard coal per kWh of electricity generated, Hansteel has saved a cumulative 4.928 million tons of standard coal over five years, equivalent to the output of a medium-sized coal mine for nearly five years, enough to fill more than 1,300 train cars.