U.S. Steel Exec: Sustainability ‘Integral to the Overall Strategy’

If your view of steel mills is smokestacks belching soot, U.S. Steel’s chief sustainability officer, Rich Fruehauf, would like a word with you.

When you think of a steel mill, you most likely conjure images of rows of smokestacks churning out black clouds of soot. Sustainability is probably one of the last things you think about.

Well, Rich Fruehauf would like to change all that. 

He’s chief strategy and sustainability officer at U.S. Steel  (X) – Get United States Steel Corporation Report, the iconic American company founded more than a century ago by the legendary executives Andrew Carnegie, J.P. Morgan, Charles Schwab and Elbert Gary.

“I have kind of an odd title, but that’s intentional,” said Fruehauf, who was in New York recently for Climate Week NYC, a gathering of influential leaders in climate action. 

“Sustainability is not an add-on for us. It’s integral to the overall strategy.” 

‘Steel Is Infinitely Recyclable’

Fruehauf, 52, joined U.S. Steel in 2014 as assistant general counsel-commercial, was named senior vice president in 2019, and took up his new position last year.

“Steel is infinitely recyclable,” he said. “You don’t lose any of the performance characteristics when you remelt it an electric arc furnace. It’s the most recycled material on Earth.”

In April 2021, U.S. Steel said it planned to achieve net-zero greenhouse gas emissions by 2050, as the Pittsburgh company intensified its efforts “to become an industry leader in lower-carbon emission steel production methods.”

While steel accounts for about 8% of global greenhouse gas emissions, Fruehauf said, the U.S. doing better than the global average.

Roughly two-thirds of U.S. steel is produced through electric arc furnaces, which produce less carbon dioxide, while one-third use blast furnaces.

This contrasts with Europe, where those figures are reversed. China, India and Russia are much more blast-furnace intensive, Fruehauf said

Cutting Greenhouse Gases

“If you produce a ton of steel through an electric arc furnace route,” he said, “it’s about 75% less greenhouse-gas emissions than if you produce a ton of steel through the blast-furnace route.” 

Last year, the company said it had closed the acquisition of Big River Steel, which Fruehauf said produces about 3.2 million tons of steel a year using electric arc furnaces. 

“When you’re using scrap steel, you can really reduce your greenhouse-gas intensity per ton of steel produced. So Big River has been a huge step forward,” he said. 

Big River, Osceola, Ark., is the first LEED-certified steel production facility in the U.S., a reference to “Leadership in Energy and Environmental Design,” a third-party green-building certification program.

“Electric arc furnaces allow us to be a more competitive steel company, but also a greener steel company,” Fruehauf said.

The Sustainable Way

U.S. Steel is looking to build a nongrain-oriented electrical steel line at Big River, with capacity for 200,000 tons a year. It’s expected to come on line in mid-2023. 

NGO steel is the most widely used core material for electric motors, generators and alternators, and U.S. Steel its expanding in this area to support increasing vehicle electrification at all the major automakers.

“Our customers have announced their own sustainability goals,” Fruehauf said. “They want to partner with suppliers who can support them and deliver the kinds of products that meet their performance needs but are also made in a sustainable way.”

In addition, U.S. Steel last year launched a brand of steel called verdeX, which uses up to 90% recycled steel and produces low greenhouse-gas emissions The name combines the Spanish word for “green” with the company’s X stock-ticker symbol.

“When people think about steel, they say it’s part of the problem. But it’s actually part of the solution,” Fruehauf said.

‘Localized Manufacturing’

When he talks about U.S. Steel, Fruehauf notes the importance of those first two letters.

“There’s a lot of talk about reshoring,” he said, “and I would like to say that we never left. We were always here in the U.S., and so we don’t need to reshore.” That’s the process of bringing production that had been moved overseas back to the U.S.

While it’s good that people are recognizing the importance of globalization, he added, “there’s also something to be said for having your manufacturing localized.”

Fruehauf ticked off some of U.S. Steel’s milestones over the years, a list that includes being the first billion-dollar business enterprise, the first company with a code of conduct, as well the place where the phrase “safety first” was coined.

“There’s a great history,” he said, “but we’ve got to transform it so that we can keep it viable and vibrant part of our economy and for another 120 years.”

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