When it comes to building our future infrastructure, steel will undoubtedly be the most crucial resource. Steel manufacturing is still an energy-intensive process, with the great majority of energy coming from fossil fuels, notwithstanding some movement from coal to coking coal. It is responsible for about 7-9 per cent of all direct emissions from fossil fuels worldwide, with coal burning accounting for the majority of these. G V Sanjay Reddy believes that there is a future where renewables will be the dominant form of energy. In support of this, he shares insights on how to catalyse our growth towards green steel and reduce coal from the equation.
Notably, renewable energy capacity is expected to grow by 50 per cent between 2019 and 2024, according to the International Energy Agency. This growth of 1,200 GW is similar to the United States' present overall power capacity. Solar is estimated to account for approximately 60 per cent of the expected growth, with onshore wind accounting for 25 per cent. In that light, steel will play a significant role in all renewables, particularly solar and wind. Each new MW of solar energy necessitates 35 to 45 tonnes of steel, while each new MW of wind energy necessitates 120 to 180 tonnes.
Nevertheless, the steel industry faces a problem in lowering carbon emissions. As energy accounts for 20 to 40 per cent of the cost of steel manufacturing, ‘green steel’ is simply not an option for most major producers. “The fact that electric arc furnaces use natural gas and hydrogen to smelt recycled steel and iron is good news. 30 per cent of the world’s steel is produced in this way. Recycling is definitely a priority in order to reduce need for new steel, but it is already largely recycled, and new steel will be the requirement,” says G V Sanjay Reddy.
Notably, Sweden is receiving the world's first customer delivery of ‘green steel’ produced without the use of coal. Hybrit, a Swedish company, claimed it was providing the steel to Volvo AB as a test run ahead of full commercial manufacturing in 2026.
Furthermore, G V Sanjay Reddy informs, “Coal-fired steel production accounts for about 8 per cent of worldwide greenhouse gas emissions. Hybrit began testing green steel at its pilot facility in Lulea, northern Sweden and its goal is to use renewable electricity and hydrogen to substitute coking coal, which is normally used in ore-based steel production. Hydrogen is an important component of the EU's goal of achieving net zero greenhouse gas emissions by 2050.”
With the tremendous improvements in hydrogen energy, we may see hydrogen used in conjunction with renewable energy to create a new technique of producing carbon-free steel. It is critical to transition to green steel, as the use of hydrogen in the iron ore and steel industry would assist reduce coal imports. Notably, the Indian government has an ambitious approach for hydrogen, according to Steel Minister Ram Chandra Prasad Singh. “As coal can be substituted by hydrogen, the iron and steel sector will benefit, and our country's reliance on coal imports will be reduced. From 22 million tonnes in 1991 to 120 million tonnes in 2021-22, the use of hydrogen by industry has achieved significant progress,” G V Sanjay Reddy informs.
Lastly, we are already constructing our sustainable future, and green steel cannot be left out. All of these concepts have merit, but we must move quickly to develop them into popular technologies. Government and commercial investment in innovation will be required to accelerate the advances required for this industry to manufacture zero carbon steel.