Sustainable steel manufacturing

January 2019: Achieving climate change goals will require decarbonising the steel industry, since it is one of the largest CO2 emitters. A shift towards greener but still experimental technologies such as the use of hydrogen as a reductant agent could fully decarbonise the steel industry. However, concerns remain over the economic feasibility of new steel making technologies.

Information

The steel industry is one of the oldest global industries, highly monolithic and steel is the second largest traded commodity after oil. It is also the largest CO₂ emitting industry and responsible for seven to nine per cent of all direct emissions from fossil fuels. At its core, blast furnaces rely on coke to smelt iron into liquid metal which is then refined into steel. However, several new but experimental technologies offer the potential to create ‘green’ steel. Examples of these technologies are that steel makers can reduce their raw material input by using more scrap metal or technologies that use hydrogen as a reductant agent. Second, end-of-pipe technologies enable blast furnaces to capture and store carbon that is then re-used during the smelting process. Thirdly, the use of electric arc furnaces allows the melting down of scrap metal and production of lower grade steel.

Implications & Opportunities

Achieving climate change goals will depend on the decarbonisation of the steel industry. A shift towards ‘greener’ technologies could potentially fully decarbonise the steel industry. However, concerns remain over the economic feasibility of new steel making technologies, especially given the volatility of the globally traded market. Further, the decarbonisation of steel will depend on its coupling with the renewable energy sector.  

Limitations

Most technologies for ‘green’ steel remain in their experimental stage. Therefore, the commercialisation and widespread application of such technologies is only predicted for 2030. Further, decarbonising steel requires a global effort to avoid trade imbalances and the import of cheaper, but ‘grey’ steel.