Biden Faces More Pressure From Environmentalists to Block Steel Merger

President Biden is facing new pressure to block Nippon Steel’s acquisition of the iconic manufacturer U.S. Steel, this time from environmental groups that say the tie-up would set back America’s efforts to curb climate change.

In interviews, environmental activists working to reduce greenhouse gas emissions say the merger would bring together two steel giants that are laggards on transitioning away from fossil fuels.

Researchers at Industrious Labs, a nonprofit pushing to decarbonize steel and other heavy industries, drew on both companies’ public disclosures to calculate that Nippon and U.S. Steel are relatively high emitters of heat-trapping gases from steel production. Both companies rely heavily on coal-powered blast furnaces and are on a slower path to transition to cleaner fuels than some international competitors. Three U.S. Steel facilities — in Pennsylvania, Indiana and Illinois — combine to emit more greenhouse gases in a year than a comparable number of coal-fired power plants, the researchers estimate.

Officials from Nippon and U.S. Steel say they are pursuing multiple strategies to decarbonize by 2050, including high-grade steel production in more efficient electric-powered furnaces and using hydrogen-injecting technology in blast furnaces, and that their merger will advance those efforts.

In a joint statement on Thursday, the companies said that the deal would “create a stronger, more competitive global company” and that Nippon and U.S. Steel “recognize that solving sustainability challenges is a fundamental pillar of a steelmaker’s existence and growth.”

Concerns about the climate implications of the deal add to growing political backlash over the proposed takeover. A bipartisan group of senators, including the Republicans Josh Hawley of Missouri and Marco Rubio of Florida and the Democrats Sherrod Brown of Ohio and Bob Casey of Pennsylvania, has urged the administration to scrutinize and stop the takeover.