SynopsisGlobalData data reveals that over 70% of upcoming steel production facilities worldwide are set to employ traditional blast furnaces, a carbon-intensive method. This data underscores the steel industry's challenge in achieving decarbonization goals. While electric arc furnaces, powered by renewable electricity, offer a more sustainable alternative, only 25% of planned steel plants opt for this technology. Additionally, a mere 3% plan to utilize hydrogen technology, despite its potential to reduce emissions in primary steel production. These findings highlight the hurdles in transitioning the steel industry towards a greener future.ArticleThe world of steel production is a realm of staggering statistics. Nearly two billion tonnes of steel are manufactured globally each year, accounting for a substantial 7% of total global emissions. Despite significant advancements in energy efficiency over the last half-century, steel remains among the 18 out of 50 sectors deemed "off track" from achieving a net-zero emissions trajectory by 2050, as per the 2023 Tracking Clean Energy Progress report from the International Energy Agency.The report acknowledges that the global energy crisis has not halted project announcements but stresses that the current pipeline of low- and near-zero-emission projects falls short of meeting the Net Zero Emissions Scenario.Recently released data from GlobalData, the parent company of Energy Monitor, vividly illustrates the extent of this shortfall. Among the 230 planned steel plants worldwide for which technology details are available, over 70% favor traditional blast furnaces. This approach involves the carbon-intensive process of heating coke (derived from coal) and iron ore to 1,650°C (3,000°F), then reacting them with carbon to produce steel.In contrast, GlobalData's data shows that only 25% of these planned steel production facilities opt for electric arc furnaces. These furnaces use an electric current to melt scrap iron and steel, enabling recycling. They can be powered by renewable electricity, making them compatible with a net-zero future, without requiring carbon capture and storage, as blast furnaces do.However, the challenge of meeting future steel demand extends beyond circular economy initiatives, given steel's vital role in clean energy technologies such as wind turbines and electric vehicles. The World Steel Association predicts a 20% increase in annual steel demand by 2050.Decarbonizing primary steel production hinges on green hydrogen, produced with renewable electricity, as a transformative solution. Hydrogen, when used in direct reduced iron (DRI) processes, replaces iron and CO2 with iron and water at relatively low temperatures (1,000°C or 1,832°F). This liquid metal can then be processed in an electric arc furnace. While the steel industry generates considerable hype around hydrogen adoption, data from GlobalData shows that a mere 3% of planned steel production facilities intend to implement hydrogen technology.Decarbonizing steel is a monumental undertaking, requiring $1.4 trillion in funding and a complete overhaul of the value chain, according to a recent report aligned with the Paris Agreement. Yet, with an effective policy framework encompassing the entire value chain, the global steel industry could potentially achieve decarbonization by the early 2040s, as suggested by a report from the German think tank Agora Energiewende.The Agora report emphasizes the need for proper planning and financing of renewable energy, hydrogen, and carbon capture and storage infrastructure to catalyze the green steel industry. It underscores that key levers for decarbonizing the steel sector include enhanced material efficiency, increased scrap-based steelmaking, and accelerating hydrogen-based steelmaking.Frank Peter, director of Agora Industry, emphasizes that the technologies and strategies required for achieving net-zero emissions are already available, urging governments and companies to collaborate in their swift deployment.However, GlobalData's data indicates that the full embrace of such technologies and strategies by governments and companies has yet to materialize.ConclusionThe steel industry stands at a crossroads, faced with the formidable challenge of decarbonization. While advancements have been made in energy efficiency, the majority of planned steel projects still favor carbon-intensive blast furnaces. Electric arc furnaces and hydrogen technology offer greener alternatives, but their adoption remains limited. To achieve a sustainable future, governments and companies must accelerate the transition to cleaner steel production methods and embrace the technologies and strategies that can lead to net-zero emissions in the industry.
SynopsisGlobalData data reveals that over 70% of upcoming steel production facilities worldwide are set to employ traditional blast furnaces, a carbon-intensive method. This data underscores the steel industry's challenge in achieving decarbonization goals. While electric arc furnaces, powered by renewable electricity, offer a more sustainable alternative, only 25% of planned steel plants opt for this technology. Additionally, a mere 3% plan to utilize hydrogen technology, despite its potential to reduce emissions in primary steel production. These findings highlight the hurdles in transitioning the steel industry towards a greener future.ArticleThe world of steel production is a realm of staggering statistics. Nearly two billion tonnes of steel are manufactured globally each year, accounting for a substantial 7% of total global emissions. Despite significant advancements in energy efficiency over the last half-century, steel remains among the 18 out of 50 sectors deemed "off track" from achieving a net-zero emissions trajectory by 2050, as per the 2023 Tracking Clean Energy Progress report from the International Energy Agency.The report acknowledges that the global energy crisis has not halted project announcements but stresses that the current pipeline of low- and near-zero-emission projects falls short of meeting the Net Zero Emissions Scenario.Recently released data from GlobalData, the parent company of Energy Monitor, vividly illustrates the extent of this shortfall. Among the 230 planned steel plants worldwide for which technology details are available, over 70% favor traditional blast furnaces. This approach involves the carbon-intensive process of heating coke (derived from coal) and iron ore to 1,650°C (3,000°F), then reacting them with carbon to produce steel.In contrast, GlobalData's data shows that only 25% of these planned steel production facilities opt for electric arc furnaces. These furnaces use an electric current to melt scrap iron and steel, enabling recycling. They can be powered by renewable electricity, making them compatible with a net-zero future, without requiring carbon capture and storage, as blast furnaces do.However, the challenge of meeting future steel demand extends beyond circular economy initiatives, given steel's vital role in clean energy technologies such as wind turbines and electric vehicles. The World Steel Association predicts a 20% increase in annual steel demand by 2050.Decarbonizing primary steel production hinges on green hydrogen, produced with renewable electricity, as a transformative solution. Hydrogen, when used in direct reduced iron (DRI) processes, replaces iron and CO2 with iron and water at relatively low temperatures (1,000°C or 1,832°F). This liquid metal can then be processed in an electric arc furnace. While the steel industry generates considerable hype around hydrogen adoption, data from GlobalData shows that a mere 3% of planned steel production facilities intend to implement hydrogen technology.Decarbonizing steel is a monumental undertaking, requiring $1.4 trillion in funding and a complete overhaul of the value chain, according to a recent report aligned with the Paris Agreement. Yet, with an effective policy framework encompassing the entire value chain, the global steel industry could potentially achieve decarbonization by the early 2040s, as suggested by a report from the German think tank Agora Energiewende.The Agora report emphasizes the need for proper planning and financing of renewable energy, hydrogen, and carbon capture and storage infrastructure to catalyze the green steel industry. It underscores that key levers for decarbonizing the steel sector include enhanced material efficiency, increased scrap-based steelmaking, and accelerating hydrogen-based steelmaking.Frank Peter, director of Agora Industry, emphasizes that the technologies and strategies required for achieving net-zero emissions are already available, urging governments and companies to collaborate in their swift deployment.However, GlobalData's data indicates that the full embrace of such technologies and strategies by governments and companies has yet to materialize.ConclusionThe steel industry stands at a crossroads, faced with the formidable challenge of decarbonization. While advancements have been made in energy efficiency, the majority of planned steel projects still favor carbon-intensive blast furnaces. Electric arc furnaces and hydrogen technology offer greener alternatives, but their adoption remains limited. To achieve a sustainable future, governments and companies must accelerate the transition to cleaner steel production methods and embrace the technologies and strategies that can lead to net-zero emissions in the industry.
