Wind turbines have a dirty little secret. This clean power generator isn't entirely clean. Wind actually requires a dirty partner to get the job done. That partner is the steel industry, which produces its share of emissions in order to bring us renewable wind energy.
Wind's strong tower
Wind towers might not emit any carbon dioxide, but the steel used in the tower creates a lot of carbon as it's produced. Every ton of steel generates almost two tons of carbon dioxide emissions. For an industry that produces about 1.5 billion tons of steel per year, that's a lot of carbon. In fact, estimates suggest that the steel industry as a whole is responsible for more than 5% of the world's greenhouse-gas emissions.
That said, the steel industry is getting much cleaner. Over the past 30 years it has reduced the energy consumption per tonne of steel production by 50%. However, by its own admittance, the industry doesn't have much room for improvement as it has already gone as far as current technology will allow. Unless there is a radical new breakthrough in steelmaking technology, the industry's only hope to reduce its carbon footprint is through carbon capture and storage or to reduce its carbon footprint elsewhere. Most American steel makers are taking that second option and investing in unique ways to reduce reduce the carbon footprint of making steel.
One company leading the way to make cleaner steel is Nucor (NYSE:NUE). The company's recycling process produces 67% less carbon emissions than an equivalent process. As North America's largest recycler of steel, Nucor is playing a major role in the efforts to reduce carbon emissions.
Nucor is not alone in its drive to clean up the steel industry. U.S. Steel (NYSE:X) is just as committed to cleaning up its emissions by driving down its energy usage. The company is investing in several technologies to make the steelmaking process more environmentally responsible. In addition to that, U.S. Steel is transitioning many of its fleet vehicles to those powered by compressed natural gas as well as biodiesel. Finally, the company actually added wind towers to its facility in Minnesota. Theses moves will enable U.S. Steel to lower its carbon footprint, even if it can't make clean steel.
The big picture: Wind still wins
Despite the fact that steel isn't clean to produce, the benefits of wind power still far outweigh the negatives of using steel. In fact, studies are now showing that wind energy is having an even greater impact on emissions than were commonly thought. That's because wind is being found to cause the worst offending coal power plants to go offline and be replaced by more efficient units. Further, studies in Spain have concluded that even intermittent wind is better than no wind in curbing carbon emissions. Even better, one recent study in the U.S. showed that if we increased wind generated capacity to 30% from the base case of 2% we would see emissions decline by 29%. That's more than a one-for-one reduction in emissions.
No energy source is truly clean. However, despite its need for steel, wind's clean image isn't tarnished one bit. Further, as steel producers work to reduce emissions and their carbon footprint, it will make wind an even cleaner power source.
Here's where to invest in 2014
Fool contributor Matt DiLallo has no position in any stocks mentioned. The Motley Fool recommends Nucor. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.