BlueScope Steel's (ASX:BSL) achievement of a 12% reduction in its steelmaking emissions is a "step in the right direction," although there are risks to the so-called five enablers that are needed to reach its decarbonization goal, according to investment and advisory group Jarden in a Thursday note.

Last Tuesday, BlueScope released its Climate Action Report, in which it announced the attainment of its 12% decarbonization target six years ahead of deadline. For non-steelmaking, the company achieved an 8.4% reduction in intensity emissions, against a target of 30% reduction by 2030 from a 2018 baseline.

"We see BSL's new Climate Action Report as a positive step toward decarbonization, with a feasible approach for achieving near-term goals while awaiting green hydrogen viability, albeit still in the options phase," said Jarden in its note.

"However, there are risks around the five enablers that will be required for steel

decarbonization, particularly supportive and consistent policies across all the enablers to underpin it," it added.

BlueScope's medium-term 2030 and 2050 net zero targets are contingent on the five enablers, namely, technology evolution, raw materials supply, access to firmed renewable energy, hydrogen and natural gas availability, and supportive public policies.

The company's shares were down 1% in recent Monday trade.

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