BNEF: Steel industry to transit to hydrogen fuel

Sep 2, 2019 – Up to 50% of the global steel industry can use hydrogen instead of coal and other fossil fuels by 2050, if a certain price level is reached, BNEF said in a statement.

According to the World Steel Association, the steel industry currently accounts for up to 9% of global carbon emissions.

Hydrogen technologies offer an effective way to reduce harmful emissions from making steel. No major breakthroughs in research and development are necessary. With some political decisions, the world could begin to produce environmentally friendly steel over the next decade, a BNEF analyst said.

Hydrogen fuel is already tested by industry giants, including the leading steel suppliers ArcelorMittal and Thyssenkrupp.

Steel is produced using a process that has remained virtually unchanged for over 150 years. At the first stage of production, iron ore is smelted using carbon-enriched coke in blast furnaces, and a huge amount of greenhouse gases is emitted alongside. Hydrogen can be used instead of coke in the technology of direct reduced iron (DRI), which does not require a blast furnace. According to a Citigroup report, DRI already accounts for about 6% of global steel production.

Hydrogen technologies in the steel industry will become competitive when the cost of such fuel drops below $2.20 per kilogram with coking coal prices at $310 per ton, which is possible in 2030.