Fraunhofer Institute for Ceramic Technologies and Systems IKTS
Scrap bonus Thailand – The social welfare benefits of stainless steel recycling in Thailand
Background
Stainless steel scrap can be endlessly reprocessed into high-quality stainless steel, making it a valuable recycled raw material. The use of stainless steel scrap as a raw material for the production of stainless steel leads to welfare gains: Current and future generations benefit from cost savings due to the avoided environmental impact. This effect is known as the “scrap bonus”. The scrap bonus stands for the social cost savings that result from the use of one ton of steel scrap due to avoided environmental pollution. Studies have shown that remelting one tonne of stainless steel scrap saves around 6.71 tons of CO2 compared to the use of ores and ferroalloys. The “scrap bonus” associated with this reduction in emissions is estimated at between 158 and 502 euros per ton of stainless steel scrap worldwide.
Project description
Southeast Asian countries are among the most vulnerable to climate change in the world. Quantifying and communicating the societal value of stainless steel scrap highlights its importance in efforts to address climate change. The project “The Societal Welfare Gains from Stainless Steel Recycling in Thailand” analyzes how Thailand benefits from stainless steel recycling by mitigating climate change. To illustrate this, the Oryx Stainless plant in Bangkok is examined and the associated welfare gains for Thailand are determined.
Services
The study is divided into three work packages. The first work package provides background information on stainless steel and its recycling processes with a focus on Thailand. The reduction of greenhouse gas emissions associated with Oryx Stainless' activities in Thailand will be quantified in the second work package based on a life cycle assessment (LCA). The results are the greenhouse gas emissions saved, expressed in carbon dioxide equivalents (CO2e) per ton of scrap. The third work package examines the impacts and costs of climate change in Thailand. It combines the emission reductions with estimates of the social cost of carbon for Thailand, converting tons of CO2e into money. It also presents policy strategies to mitigate climate change in Thailand, with a focus on strategies based on the circular economy. The work was carried out together with partners in Thailand. A focus was placed on involving Thai scientists and stakeholders in the entire process and using their expertise to make an important contribution to a validated and recognized result of the study.
Project duration: December 2022 – March 2024
Client: Oryx Stainless (Thailand) Co., Ltd