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- The report focuses on ways to decarbonize the steel industry, using hydrogen, carbon capture and storage (CCS), as well as referencing biogas/biomass. We analyze the constraints on producing green steel from green hydrogen including: availability of high-grade iron ore; access to new renewable energy sources; electrolyzer capacity; and the sunk costs of existing blast furnaces.
- The steel industry is one of the largest contributors to global carbon emissions, accounting for 7% of total emissions in 2019.1 Left unchecked, emissions are forecast to rise by 44% by 2050.2 However, there is another option where emissions could fall by 54% by 2050: green steel from zero-emissions hydrogen.
- Zero-emissions hydrogen can act as catalyst for accelerating the decarbonization of other industries including fertilizer, transportation/shipping, ceramics and glassmaking. Using hydrogen as a heat source is not new—what has changed is the dramatic decline in cost of inputs, including renewable energy.
- The report includes case studies on POSCO, Baosteel and SSAB/LKAB/Vattenfall JV. We break down the processes for producing steel in a blast furnace, a hybrid fluidized reduction furnace and zero-emissions fluidized reduction furnace.
- We are optimistic that the switch to green steel using hydrogen as the reductant and heat source will occur in developed markets. However, as the drivers of the forecasted one-billion-ton increase in steel demand by 2050 will be concentrated in emerging markets, these countries will need support and technology transfer if the challenge of decarbonization in the global steel industry is to be successful.
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1. Source: Energy Transmissions Commission.
2. Source: Energy Transmissions Commission. There is no assurance that any estimate, forecast or projection will be realized.