Decarbonization of the Steel Industry: A Techno-economic Analysis

A substantial CO2-emmissions abatement from the steel sector seems to be a challenging task without support of so-called “breakthrough technologies”, such as the hydrogen-based direct reduction process. The scope of this work is to evaluate both the potential for the implementation of green hydrogen, generated via electrolysis in the direct reduction process as well as the constraints. The results for this process route are compared with both the well-established blast furnace route as well as the natural gas-based direct reduction, which is considered as a bridge technology towards decarbonization, as it already operates with H2 and CO as main reducing agents. The outcomes obtained from the operation of a 6-MW PEM electrolysis system installed as part of the H2FUTURE project provide a basis for this analysis. The CO2 reduction potential for the various routes together with an economic study are the main results of this analysis. Additionally, the corresponding hydrogen- and electricity demands for large-scale adoption across Europe are presented in order to rate possible scenarios for the future of steelmaking towards a carbon-lean industry.