According to a new report by BloombergNEF (BNEF) steel could shed its reputation as a climate threat by using hydrogen instead of fossil fuels for as much as half of its global output by 2050.
The steel industry could adopt hydrogen for between 10 per cent and 50 per cent of output by mid-century given the right carbon pricing, BNEF analysts wrote in a report.
The sector accounts for as much as nine per cent of global carbon emissions, according to the World Steel Association.
“Hydrogen technologies offer a viable pathway to slash the emissions from making steel,” Kobad Bhavnagri, head of special projects at BNEF, said by email.
“No big research and development breakthroughs are necessary.
“If policy was in place, the world could start producing green steel within a decade.”
Hydrogen is one option for steelmakers facing louder calls from climate lobbyists and regulators to tackle their carbon problem.
It’s an alternative already being tested by industry giants including top supplier ArcelorMittal, as well as Germany’s Thyssenkrupp.
Steel is currently made from mined iron ore using a process largely unchanged for more than 150 years.
Iron ore is first smelted with carbon-rich coke in huge blast furnaces that emit carbon gases and churn out liquid metal.
BNEF said gases could be used instead of coke as reduction agents in an alternative process called direct reduced iron, or DRI.
This does away with the blast furnace and is already employed in some locations using natural gas.
“Hydrogen can do everything coal does in the steel-making process, and the technology to make fossil-free steel is already currently operating with natural gas in many parts of the world,” Mr Bhavnagri said.
DRI accounts for nearly six per cent of steel output worldwide, according to a report from Citigroup.
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