"Green" steel
The challenge of decarbonising steelmaking
Steel is all around us in modern society. Whatever device you are using to read this blog post, it almost certainly contains steel. As do all kinds of machines, vehicles, domestic appliances and tools. Not to mention buildings and infrastructure: the construction industry is the destination for roughly half of all the world’s steel production.
Unfortunately, steelmaking has serious environmental impacts, including extremely high greenhouse gas (GHG) emissions. What can we do to mitigate that, as well as the other main environmental impacts of steelmaking? Is it possible to produce “green” steel, or should we just be looking to replace it? Those are some of the questions I will try to answer in this week’s post.
What’s the problem with steel?
Each year, the world produces around 1,900 million tonnes of steel, over half of which is made in China. That’s enough to build 36 thousand Sydney Harbour Bridges, or four every hour. By contrast, when the bridge was completed in 1932, annual steel production was little over 100 million tonnes.
That growth rate comes at a cost: for each tonne of steel produced, around 1.85 tonnes of CO2 are released into the atmosphere, adding up to around 8% of total global CO2 emissions.1
GHG emissions are not the only issue. Most steel is produced by mining iron ore and then heating it in a blast furnace followed by a basic oxygen furnace. All of the stages of this process have wider environmental impacts.
Iron ore is generally extracted at open pit mines, damaging local landscapes, habitats and ecosystems. After the commercially viable iron ore has been separated from the uneconomic fraction, you are left with a waste product known as tailings, which contains heavy metals. The tailings are diluted with water to form a slurry, which is stored behind dams.
Although the slurry is highly toxic, dam failures are not uncommon.2 The worst recent disaster occurred in 2018, when the Brumadinho tailings dam in Brazil failed. That released a wave of slurry, which tragically killed 270 people. In addition to the immediate impacts, heavy metals can enter groundwater and river systems. This harms both terrestrial and aquatic ecosystems, as well as posing a risk to human health. And even without a dam failure, heavy metals can gradually leach into the surrounding environment.
The fuel and reducing agent for the blast furnace stage is coke, which is made from coal in another energy-intensive process. Coke production also releases harmful chemicals into the air, including potentially carcinogenic polycyclic aromatic hydrocarbons (PAHs).
Finally, after the steel has been produced, you are left with slag – a mixture of limestone and impurities from the iron ore. This is often used as aggregate in the construction industry, but as it contains heavy metals, there is a risk of it contaminating the environment.
Decarbonising the steel industry
The energy required for current steelmaking processes makes them fundamentally incompatible with the Paris Agreement and the net zero goals that many countries have set themselves. Both the industry and politicians are well aware of this, so a number of changes are under way.
In Europe, steelmakers enjoy free Emissions Trading System (ETS) allowances, essentially exempting them from carbon pricing. However, this arrangement will be phased out over the period 2026-35, and from 2026 onwards steel imports will also be subject to a Carbon Border Adjustment Mechanism (CBAM).
This provides a strong financial incentive for steelmakers to reduce their carbon emissions and creates a risk of stranded assets3 if they fail to prepare and adapt. Steelmakers are conscious of this danger, and a lot of research is being done on ways to decarbonise steel production.4
One way to produce “greener” steel is to recycle scrap steel. This so-called secondary steel production requires less energy than making steel from iron ore, and as it is produced in an electric arc furnace (EAF), it has the added benefits that go with electrification. Moreover, it eliminates the serious environmental impacts of mining iron ore and producing coke. Almost a quarter of the world’s steel already comes from recycling scrap steel.
EAFs can also be used to make steel from direct reduced iron (DRI). DRI is made by reducing iron ore without melting it. This can be done at a lower temperature than is used in a blast furnace – around 1000 ⁰C instead of above 1500 ⁰C – which makes it less energy-intensive. Traditionally, this process has used natural gas or coal as the fuel and reductant. If natural gas is used, it reduces CO2 emissions by around 35% compared with a traditional blast furnace.5 That is a big improvement, but still a long way from the ultimate goal of carbon neutrality. At best, therefore, it is a “bridging” technology.
To further reduce GHG emissions, producers are experimenting with replacing some of the natural gas with green hydrogen (hydrogen made using electricity from renewable sources). There is also an R&D project underway in Sweden to make completely fossil-free steel, but even if it is successful, it will be a long time before it results in large-scale commercial production. It can also be argued that using renewable energy to make the necessary hydrogen leaves less renewable energy available for other purposes, so the net result is that more fossil fuels are burned somewhere in the electric power system. The environmental credentials of this technology are therefore heavily dependent on our ability to green the power grid [link].
Various other ways to decarbonise steelmaking have been proposed, such as using biomass as a fuel and reducing agent. Successful trials have been carried out, but limits on the availability of suitable biomass near steelmaking plants, and competition with other potential uses, will make it hard to scale up this technology to a level that significantly reduces GHG emissions.6
Carbon capture and usage is another proposal, which would involve capturing the waste gases from the steelmaking process and using them in the chemical industry. However, the technology is untested, and if Carbon Capture and Storage (CCS) for power stations is anything to go by, costs are likely to be high.
Can’t we just stop using steel?
The short answer is no. A growing world population and economic growth will inevitably lead to more homes, shops, factories and railways being built, as well as more people wanting cars, washing machines and computers.
Nevertheless, there are various ways we can reduce the amount of steel we use. Most obviously, in rich countries people can buy fewer things. But while that is a laudable goal, experience tells us that it is hard to achieve, in spite of people’s good intentions. Perhaps it is more realistic to recycle and reuse more products containing steel, as well as extending their useful lives.
In the construction industry, steel can in theory be replaced by other products in many applications, but it is difficult to replicate steel’s strength and versatility. What’s more, the alternatives come with their own sets of problems. Concrete, for instance, is arguably more polluting than steel. From an environmental point of view, timber does have many advantages, but it cannot simply replace steel overnight. It takes time to build up the necessary supply chains and skill sets, and there are many other constraints as well, including the availability of raw materials. I will write more about concrete, timber and other potential alternatives such as fibre-reinforced plastic (FRP) in future blog posts.
Outlook
Since steel will continue to be used in great quantities for the foreseeable future, our aim must be to reduce the GHG emissions and other environmental impacts associated with its production as quickly as possible. That includes providing more government support for the development of new, greener technologies, as well as using market mechanisms like carbon pricing to provide an incentive for steelmakers to reduce their emissions.
In the short to medium term, all of the technologies and measures described in this post may help to reduce emissions from steelmaking. In the longer term, green hydrogen seems to be the best bet for producing virtually carbon-neutral steel, but there is a very long way to go before we get there, and it relies on having ample green electricity available to make the hydrogen. That will be a recurring theme in this blog: unless we ramp up renewable electricity generation much faster than we have in the past, all of our efforts to make other parts of the economy more sustainable will be doomed to failure.
Estimates vary. https://www.mckinsey.com/industries/metals-and-mining/our-insights/decarbonization-challenge-for-steel
https://www.sciencedirect.com/science/article/pii/S0013795222001429?dgcid=rss_sd_all
https://www.transitionzero.org/blog/stranded-assets-carbon-pricing-risk-steel
https://www.mckinsey.com/~/media/McKinsey/Industries/Metals%20and%20Mining/Our%20Insights/Decarbonization%20challenge%20for%20steel/Decarbonization-challenge-for-steel.pdf
https://link.springer.com/article/10.1007/s00501-020-00975-2
https://www.ieabioenergy.com/wp-content/uploads/2020/10/IEA_Bioenergy_eWorkshop_2021_2-1_JuhaHakala.pdf