In a brand new building in the Swedish city of Luleå, steelmaker SSAB is using a new production method that could revolutionize the highly polluting steel industry by eliminating almost all of its CO2 emissions.
Be careful, though: making the method work on a large scale presents major challenges, and this technique may not be as decisive as everyone hopes. Critics say it could simply shift emissions elsewhere. Quite a mess, huh? Finding ways to decarbonize steel, an indispensable component of modern industry, is one of the keys to dramatically reducing emissions and meeting climate goals.
Steel, an elephant in a crystal shop
Among the heavy industries, steelmaking is the number one for CO2 emissions according to the IEA.
La World Steel Association estimates that the industry accounts for approximately 7% to 9% of human-caused emissions worldwide, with an estimated 2,6 billion tons of CO2 emitted in 2020 alone.
Below with the “green” steel. But how green is it?
In Luleå, the sterile appearance of the new building stands in stark contrast to the nearby soot-covered blast furnace it is supposed to replace. With its distinctive orange glow of molten metal, the blast furnace is the primary method of producing steel today.
Changing technology from a normal blast furnace where we use coal and emit CO2, we end up with normal water instead. We can reduce emissions from steel production by 90%.
Monica Quinteiro, manager of the SSAB plant
With no oxygen, no problem?
Iron ore that comes out of a mine is usually rich in oxides, chemical compounds made up of iron and oxygen, the best-known form of which is rust. To make steel, all that oxygen has to be removed, and in Luleå they do it a little differently. “Instead of using heated air, we circulate hot hydrogen gas,” explains Quintero. Hydrogen, like the carbon in coke, bonds with oxygen in iron ore, creating water instead.
Although the so-called direct iron reduction is not entirely new, the new plant (which is part of a project called HYBRIDS) stands out for the use of hydrogen, produced by electrolysis, and for electricity in the production process coming only from renewable sources.
If the pilot project works and is scaled up, Quintero says, “we can in principle solve the root cause of CO2 emissions.”
Yet challenges remain for green steel
In August, SSAB shipped the first batch of steel sheets, 25 tons, made with the new process, labeled as “fossil-free” by the truck manufacturer Volvo. It's a drop in the ocean compared to 1,86 billion tons of steel shipped by steelmakers in 2020, according to the World Steel Association.
But SSAB aims to produce 1,5 million tons of “fossil-free steel” per year starting in 2026, compared to its current production of 7,5 million tonnes per year. Can it be done more quickly? Maybe.
The biggest obstacle to large-scale production is access to electricity, especially electricity produced from renewable sources. To operate on a large scale, SSAB would need approx 15 terawatt hours (TWh) of electricity per year. For the "clean" extraction of iron, however, 55 TWh are needed. It's a lot. It's too much. To give you an idea, the total represents about a third of the total electricity consumption of the whole of Sweden.
Doubts upon doubts
“It takes enormous amounts of electricity, at a time when electricity production is already at risk,” he says Christian Sandstrom, associate professor at Jonkoping International Business School. Sandstrom and two colleagues wrote an article in October criticizing the project and questioning the “fossil-free” label.
The real effect of this hydrogen-based steel is increased electricity consumption, and from what we can see there are no signs that electricity is becoming totally “fossil-free”.
Christian Sandstrom, associate professor at Jonkoping International Business School.
Yet things keep moving. In February, the newly formed Swedish company H2 Green Steel announced plans to build a facility that would be operational in 2024. The Chinese company Hbis, the world's third-largest steel producer, announced in May that it had started production at a demonstration plant for its direct reduction of iron using hydrogen.
Perhaps the method needs to be re-discussed, perhaps we still have to wait to have more electricity from renewables, but many are betting that green steel will truly be the future.