According to the report titled “Decarbonizing Steel: A Net-Zero Pathway”, by 2050, green hydrogen could be the cheapest method of producing steel and capture 31% of the market.
“Another 45% could come from recycled materials and the rest from a combination of old coal-fired power plants equipped with carbon capture systems and innovative processes using electricity to refine iron ore into iron and steel”, did he declare.
The report added that it would be a radical change in the type of furnaces and fuels used to produce steel.
Today, about 70 percent of steel is made in coal-fired blast furnaces, 25 percent is produced from scrap metal in electric furnaces, and 5 percent is made in a newer process, usually fired at natural gas, known as DRI, or direct reduction. iron.
Converting a significant portion of the fleet to hydrogen would require more DRI factories and more electric furnaces. Blast furnace production would fall to 18% of capacity in this scenario.
The report says hydrogen and recycling will play a central role in reducing emissions from steel production. Steel is responsible for around 7 percent of human-made greenhouse gas emissions each year and is one of the most polluting industries in the world.
“The steel industry cannot afford to wait until the 2040s to begin its transition,” said Julia Attwood, responsible for sustainable materials at BNEF and lead author of the report.
Attwood added that the next 10 years could see a massive expansion in steel capacity to meet demand in growing economies, like India.
“The new factories of today are the renovations of tomorrow. The commissioning of natural gas power plants could allow producers to have one of the cheapest capacity by adapting them to burn hydrogen in the 2030s and 2040s, ”she said.
She added, however, that continued construction of new coal-fired power plants would leave producers with poor options towards a net zero future by 2050.