Yarlung Zangbo Hydropower: A Boost for Steel Demand, a Test for Technology

The Lower Yarlung Zangbo River Hydropower Project (abbreviated as the Yarlung Zangbo Project) officially commenced construction on July 19, 2025. As a "century project" with a total investment of 1.2 trillion CNY, it boasts an installed capacity ranging from 70 to 81 gigawatts (GW)—equivalent to the scale of three Three Gorges Power Stations. Not only serving as a pillar project of China’s "West-to-East Power Transmission" strategy, it also creates a historic opportunity for the steel industry, driving tens-of-millions-of-ton-level demand growth and industry-wide technological upgrading.

I. Total Steel Demand: A Mega-Order of 4–6 Million Tons

The steel demand for the Lower Yarlung Zangbo River Hydropower Project (Yarlung Zangbo Project) spans the entire construction cycle, covering civil engineering, equipment manufacturing, power transmission, and other key links. According to the latest consensus from the Symposium of the China Special Steel Enterprise Association, the project’s total demand for special steel is projected to reach 4–6 million tons—equivalent to 1.2% of China’s national crude steel output in 2024—with core categories including medium-thick plates, high-grade silicon steel, stainless steel, and corrosion-resistant high-strength structural steel. This scale far exceeds the 590,000 tons of steel consumed by the Three Gorges Project, driven primarily by three key factors:

Exponential Expansion of Project Scale

The Yarlung Zangbo Project’s total investment is 5.8 times that of the Three Gorges Project, with an installed capacity 3.1–3.6 times larger. It involves the construction of five cascade power stations and an ultra-long tunnel cluster, leading to an exponential increase in steel usage for core structures.

Stringent Extreme Environmental Requirements

The project is located in an environment characterized by ultra-low temperatures (-40°C), high altitude, and highly corrosive water. These conditions necessitate both an increase in steel consumption and an upgrade in material performance—traditional steel materials are unable to meet such technical specifications.

Expansion of Supporting Infrastructure Systems

Steel used in supporting projects (e.g., 2,000 km of ultra-high voltage transmission grids, bridge and road infrastructure) accounts for over 30% of total demand. Alone, the transmission tower structures require 280,000 tons of weathering-resistant angle steel.

II. High-End Special Steel as the Core Material for the Yarlung Zangbo Project

The steel demand of the Yarlung Zangbo Project exhibits distinct characteristics of specialization, high strength, and long service life, with clear requirements for core material categories. According to preliminary estimates by relevant institutions, the breakdown of steel usage is as follows (subject to adjustment based on construction progress):

Steel for main structures: 60%–70% of total demand, equivalent to 2.4–4.2 million tons;

Steel for underground works: 15%–20%, equivalent to 0.6–1.2 million tons;

Steel for mechanical and electrical equipment and installation: 10%–15%, equivalent to 0.4–0.9 million tons;

Steel for construction auxiliary works: 5%–10%, equivalent to 0.2–0.6 million tons;

Steel for other special purposes: 5%, equivalent to 0.2–0.3 million tons.

III. Extreme Environment-Driven Special Performance Requirements

Ultra-Low Temperature Toughness

Threaded steel for water diversion tunnels and steel plates for pressure pipelines must maintain high toughness at -40°C. Traditional steel materials are susceptible to brittle fracture under such conditions.

Extended Corrosion Resistance Lifespan

Stainless steel used in turbine runners is required to resist highly corrosive water and sediment scouring for over 50 years—a 30% extension compared to the performance standard of the Three Gorges Project.

Low-Carbon Constraints

The carbon footprint of steel for the main structure must not exceed 1.8 tons of CO？ per ton of steel (vs. the industry average of 2.8 tons of CO？ per ton), which compels the transformation of electric furnace-based short-flow steelmaking processes.

IV. Technical Challenges and Responses: Breaking Through the Four Major Bottlenecks

The extreme plateau environment and engineering complexity impose unprecedented challenges on steel performance and supply chain resilience.

1.Tackling Environmental Adaptability

Ultra-low temperature toughness at -50°C as a mandatory requirement: Traditional steel exhibits a sharp increase in brittleness at low temperatures. To address this, toughness enhancement is achieved through compositional optimization (e.g., nickel and molybdenum addition) and controlled rolling and cooling (TMCP) processes.

Mitigation of highly corrosive water conditions: A new type of corrosion-resistant steel has been developed for sluice gates, extending the corrosion-resistant lifespan by 60%. Additionally, inert gas shielded welding (GMAW) is employed to resolve the issue of reduced deposition efficiency at high altitudes.

2. Extreme Supply Chain and Logistics Challenges

Tibet lacks large-scale steel mills, resulting in logistics costs for inbound steel accounting for up to 45% of total costs (compared to only 18% for projects in inland China). Solutions focus on two key strategies:

Semi-finished Product Processing Model: Inland steel mills supply pre-processed billets, which are then coiled and welded at processing centers in Nyingchi/Lhoka. This reduces transportation costs by 30-40% (e.g., freight rates from Chengdu to Nyingchi drop from 980 RMB/ton to 580 RMB/ton).

Dedicated Railway Lines: The Qinghai-Tibet Railway operates dedicated "Hydroelectric Steel Freight Trains" with a daily capacity of 8,000 tons. However, 45% of materials still require secondary road transport, leading to regional price premiums such as a 150 RMB/ton weekly price increase for rebar in Lhasa.

3. Mandatory Green and Low-Carbon Constraints

The project mandates a 35% reduction in the carbon footprint of the main structural steel compared to the industry average, compelling steel enterprises to accelerate the transition to short-process (electric arc furnace) production routes.

4. Comprehensive Upgrade of Technical Standards

The tensile strength of steel for pressure pipelines has been upgraded from 690 MPa to the 785 MPa grade. The demand for Z-direction tear-resistant steel plates accounts for 35% of total steel requirements, yet the national production capacity of such plates only constitutes 6% of the total medium and heavy plate capacity. The China Special Steel Association is leading the formulation of the new national standard GB/T 714-2025 and organizing a "Specialized, Sophisticated, Unique, and New Expert Group" to conduct research on customized development.

Impacts of the Yarlung Zangbo River Project on the Steel Industry

The project’s impact on the steel industry extends far beyond simple scale expansion. The steel demand exhibits three core characteristics: specialization, high strength, and long service life—reflecting the qualitative transformation of China’s special steel industry from "following" to "leading". During the 10-year construction period, steel demand will be released in three phases:

Initial phase (2025–2027): Dominated by demand for rebar and construction machinery steel;

Middle phase (2028–2030): Peak demand for medium and heavy plates;

Long-term phase (2035 onwards): Demand for steel for mechanical and electrical equipment driven by the westward relocation of the green power industry.

This will not only reshape global technical standards for hydropower steel but also propel China’s steel industry to the top of the global value chain amid the trends of green low-carbon development and high-end manufacturing.