In the second step, iron is further treated to make steel, to the specifications of the grade of the final product. This can happen via a basic oxygen furnace or a newer, relatively cleaner technology called an electric arc furnace. Today, the cheaper and higher emitting blast furnace/basic oxygen furnace method accounts for nearly three-quarters of global steel production.
New on the scene is hydrogen-powered steelmaking, which keeps this process largely intact, replacing the blast furnace with a direct-reduction reactor and then employing an electric arc furnace for the next step. Because green hydrogen generates water instead of carbon dioxide as a byproduct, steel-producing technologies powered by green hydrogen release roughly 90% fewer carbon emissions than conventional processes.
H2 Green Steel is a Swedish manufacturing startup that expects to begin production on lowcarbon steel powered by green hydrogen as early as 2025. At the CKI workshop, H2 Green Steel’s chief technology officer, Maria Persson Gulda, presented the company’s plans: a green-hydrogen-powered plant set to be built in Boden, in northern Sweden, which the company projects will annually produce 5 million tons of green steel by 2030.
Persson Gulda acknowledged that her company’s steel comes with a price premium of 20% to 30% above the cost of traditional steel. Even so, the company has already signed deals to supply its greener product to IKEA, Mercedes-Benz, and BMW. Persson Gulda explained that as business leaders at these companies and others consider the looming pricing impact of frameworks like CBAM, H2 Green Steel’s current price premium becomes competitive.
She illustrated how her company’s plans have already begun to reshape steel production in certain corners of the industry. When H2 Green Steel announced its plans in February 2021, only about 2 million to 3 million tons of green steel projects were in the works in Europe. Since that time, more than 40 million tons of green steel projects have been slated by 2030.
Representatives of incumbent steelmakers at the workshop also see promise in hydrogenpowered steel. Hyundai Steel’s Kim said he is hopeful about hydrogen as a long-term means toward achieving the company’s goal of carbon neutrality by 2050.
At the same time, Kim voiced concerns about the future global undersupply of green hydrogen — and he wasn’t the only one at the workshop to do so. What’s more, the affordability of using green hydrogen to power steel production, as H2 Green Steel intends to do, is highly dependent on geography, and northern Sweden happens to be one of the only places in the world where it’s economically feasible.
In his presentation, Dan Steingart, a Columbia School of Engineering professor of chemical metallurgy and chemical engineering, pointed out another challenge the hydrogen-powered process presents: It’s less favorable than the traditional process, all the way down to the level of the chemical reaction.
In a blast furnace/basic oxygen furnace, much of the necessary heat is produced by the chemical reactions between iron, oxygen, and carbon inside the vessel. “The chemical reaction does most of the work,” Steingart explained. “You’d have to use significantly more hydrogen as methane in the DRI process to achieve the same effect. And the methane-DRI process is a niche process relative to the dominant coal blast furnace. We can use hydrogen instead of coal, but it’s working at an energy deficit.”
It’s simply for this reason that Steingart waxes poetic about today’s most common form of steelmaking, via the blast furnace, even as he acknowledges the necessity of transforming it for the sake of the climate. “Steel production as it exists is a beautiful thing,” Steingart said. “I find it scary that we can’t use blast furnaces in the sustainable future.”
Over the past four years, Steingart has researched energy storage devices in electrochemical reactors; he also heads the Steingart Lab, which actively studies electrochemical metal production systems. He said he is excited about one specific means of revolutionizing steel production: electrolysis. Steingart served as an advisor and chief scientist for three years at Electra, a Boulder, Colorado-based startup that uses a low-temperature, oxygen-decoupled electrolysis process to make steel. Electra’s CEO and co-founder, Sandeep Nijhawan, also participated in the CKI workshop.
Steingart suggested taking this revolutionary process a step further: It could act just like a battery, he said. In other words, the steelmaking process could conceivably also begin to act as a means of energy storage. “On any given day, in my mythical future, an electrolytic iron operator could decide whether to: a) produce electricity, or b) sell electricity.” he said.
The electrolysis technology that Steingart and Electra’s Nijhawan describe has some additional advantages. It is able to use high-impurity ores and seek out lowest-cost intermittent renewables, lowering operating costs and overall capital intensity of the ore-to-metal value chain, and allowing it to potentially get to cost parity with incumbent fossil-fuel-based approaches.
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Insight 3: The world needs a consensus definition of green steel (and green iron).
Insight 4: A just transition for steel should include resources for educational and training programs.
