European Steelmakers' Association Eurofer has welcomed the European Commission's launch July 8 of its Hydrogen Strategy for a Climate-Neutral Europe as the region's steelmakers prepare to become significant potential users of hydrogen. The strategy sets out a plan to establish an integrated hydrogen network in Europe by 2050.
However, "the European steel industry will need millions of tonnes of competitively priced hydrogen by 2050 to make its low-carbon transition as success," Eurofer warns. Steelmaking is estimated to be responsible for about 9% of carbon emissions globally.
The EC's new hydrogen strategy aims to mobilize resources and actors to install at least 6 GW of renewable hydrogen electrolyzers in the EU by 2024, and 40 GW by 2030, as part of its broader European Green Deal policy for the EU to be climate neutral by 2050.
The EC estimated it could cost up to Eur9 billion ($10 billion) to achieve the 6-GW renewable electrolyzer goal.
European steel, mining and energy companies including ArcelorMittal, thyssenkrupp, voestalpine, Liberty Steel Group, SSAB, LKAB and Vattenfall are all working on the development of hydrogen-based steelmaking processes in bids to become carbon-neutral, as it is considered that carbon capture and storage alone will not allow the steel sector to become carbon neutral. However, hydrogen prices need to fall significantly from current levels, to around $1-$2/kg to make use by the steel industrial viable, and this will come only with much greater production of hydrogen, representatives of these companies have said.
"Steel produced using new hydrogen and clean-energy based methods will be 80-95% less CO2-intensive by 2050 than they are today, but will also cost significantly more to produce," Eurofer said in a statement commenting on the new hydrogen strategy.
In a separate "Green Deal for Steel" document published recently, Eurofer put these extra costs at anywhere between 35% and 100% percent higher than today's costs, per metric ton of steel produced.
"However, using hydrogen in steel plants will allow regional synergies, as other industrial sectors, SMEs and municipalities could connect to the hydrogen network born out of the large-scale demand created in the steel industry, fostering new opportunities and jobs," the steelmakers' association said, calling for policymakers to ensure there is a market for 'green steel' and other low-carbon industrial products.
Eurofer's "Green Deal for Steel" document notes that European steel's transition to carbon-lean, 'green' steel requires a fundamental change in the way steel is made, "because our current processes are already at the technical and thermodynamic limits.
"The technical demands are enormous: our sector alone will require 400 terawatt hours of renewable electricity, of which 250 terawatt hours [is] for the production of 5.5 million tonnes of hydrogen. This is the same as the current electricity demand of Germany, and this quantity will be needed every year from 2050 at the latest," it said.
With supportive conditions in place, notably the right infrastructure and a supportive regulatory framework, the EU steel industry would be able to develop, upscale and roll-out new technologies that could reduce EU steel production's CO2 emissions by 30% by 2030 and by 80%-95% by 2050, while contributing to greenhouse gas mitigation across all sectors, according to Eurofer.
