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Piloting the Climate Club in the Steel Sector

by Parul Kumar, Heiner von Lüpke, Max Åhman, Simon Otto, Samuel Flückiger, Åsa Ekdahl

Focus on the Quick Wins, Create a Safe Space for Dialogue

The Paris Agreement represents the collective ambitions of its signatory countries to limit the global average temperature to well below 2°C and pursue efforts to limit it to 1.5 °C. Given the limitations of a multilateral format focusing on overarching climate change mitigation goals, recent discussions have focused on establishing plurilateral alliances. This paper sheds light on the potential of a sectoral alliance for steel and develops policy recommendations for piloting a climate club in the steel sector.

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The G7 has provided the initial ideas and the Terms of Reference for kick-starting a Climate Club, which will be launched shortly, and officially commence its activities. Conceptualised as a high-ambition intergovernmental forum with a particular focus on industrial decarbonisation, the Climate Club aims to be open and inclusive and currently already has 27 member countries.

Building on existing discussions on industrial decarbonisation and international cooperation, this paper presents the value and challenges of piloting the activities of the Climate Club in the steel sector, a high-emission sector with significant trade exposure. The authors make a case for greater institutionalisation of international cooperation efforts through the Climate Club, which can set membership criteria based on well-defined targets and accompanying roadmaps, and can further fill the gap in ongoing steel sector initiatives.

Through concrete examples of potential cooperation between countries from the Global North and the Global South across the steel value chain, this paper illustrates the importance of building trust and creating a safe space for discussion and policy coordination in the steel sector. 

Read the full title: „Piloting the Climate Club in the Steel Sector: Focus on the Quick Wins, Create a Safe Space for Dialogue“ here as a PDF.

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