Steel, Hydrogen, and the Future of Heavy Industry

Jul 13, 2023 | Blog |

by Ileagh MacIvers, Clean Cars Organizer

Introduction: Steelmaking’s Environmental and Health Impacts

In order to address climate change, it is imperative that we stop burning fossil fuels like coal, oil and methane. This decarbonization is coming to the global economy’s most critical sectors, from transportation to power generation to agriculture. One of the most important sectors that has fallen behind on decarbonization goals is heavy industry, including steelmaking. Steel is the world’s most used metal, and is a critical component of vehicles, airplanes, buildings, and household appliances around the world. Unfortunately, steel also has serious climate consequences, and is currently responsible for approximately 8 percent of global carbon dioxide emissions, more than the entire country of India. In addition, total carbon dioxide emissions from steel continue to rise, largely due to increasing demand. Using conventional steel production methods is incredibly emissions-intensive, and “each ton of steel produced in conventional furnaces [releases] between 1.5 tons and 3 tons of CO2…into the atmosphere.” Steelmaking is so carbon-intensive due to the primary methods of extracting iron, a critical component of steel, from its ore. Giant blast furnaces are heated to 1,000 degrees Celsius and “are loaded with [iron ore], lime and coke, a fuel derived from metallurgical coal that removes the oxygen molecules from iron oxide.” This process in turn produces significant amounts of carbon dioxide.

While steel recycling is well-established in the US, it isn’t enough to meet global demand, especially since technologies powering the zero-emission transition, such as electric vehicles and wind turbines, also require considerable amounts of the metal. According to The Financial Times, industry-wide steelmaking emissions would need to be cut in half by 2050 in order to meet global climate and energy goals. Also important to note are the significant public health impacts of conventional steelmaking. Burns Harbor, an integrated steel mill in Northwest Indiana, leads the entire state as the single biggest industrial emitter of health-harming NOx, SO2, and PM2.5. In 2018, the facility was also named the “largest source of industrial lead pollution” in the country after emitting nearly 18,000 pounds of lead and 173,000 pounds of cancer-causing benzene in 2016. As people of faith and conscience who are called to care for our neighbors, the human toll of traditional steelmaking is unacceptable.

Alternatives to Coal-Powered Steelmaking

The main “green” technology currently being introduced to the steelmaking industry is the use of green hydrogen as a fuel source in an alternative process called direct reduced iron (DRI). Today, DRI plants account for approximately 10% of global steel production and run on methane gas. However, new plants could be built to run on green hydrogen and existing plants could be converted to green hydrogen. It is important to note that not all hydrogen is created equal. Despite the fact that hydrogen is an essential molecule for life and is “the most abundant chemical element in the universe,” it is typically not found in its pure form, meaning that it needs to be broken down to get pure hydrogen for use as a fuel source.

Some of the main types of hydrogen include blue hydrogen, green hydrogen, and pink hydrogen. Blue hydrogen “is hydrogen produced from natural gas with a process of steam methane reforming, where natural gas is mixed with very hot steam and a catalyst.” Then, the carbon byproducts are captured and stored underground. Pink hydrogen is created when “nuclear energy is used to power the electrolytic conversion of water into oxygen and hydrogen.” However, the only kind of hydrogen that IPL currently supports is green hydrogen, which is produced from 100 percent renewable energy. The use of hydrogen as a fuel is “clean” only if there are zero carbon emissions from its production, storage, distribution, and use, and only “green hydrogen” fulfills this requirement. Unfortunately, green hydrogen is currently 4 to 6 times more expensive than fossil fuel hydrogen and makes up less than 1 percent of U.S. hydrogen production. However, the US Department of Energy has invested $8 billion dollars in establishing hydrogen hubs, including the Regional Clean Hydrogen Hubs program (or H2Hubs) which allocates up to $7 billion to establish six to 10 regional clean hydrogen hubs across America. The Biden administration hopes that these hubs “will create networks of hydrogen producers, consumers, and local connective infrastructure to accelerate the use of hydrogen.” Still, it will take widespread industry investment, in addition to policy incentives and public support, for green hydrogen to establish a strong foothold in the steelmaking industry.

Next Steps: Automaker Accountability

So how can we move steelmaking companies toward a green steel future? Automaker accountability. Cleveland-Cliffs, one of just two blast furnace operators left in the US, earns more than a third of its sales from the automotive industry, and automakers account for around 12% of global steel consumption. The average automobile is made up of between 50 and 65% steel by weight, and this steel is responsible for approximately 30 to 40% of a vehicle’s materials emissions. It is not enough for automakers to transition to zero emission vehicles– they must do so in a way that decarbonizes the entire supply chain. The automotive steel market is huge, and was valued at USD 112.93 billion in 2021. The sixteen biggest automakers use “at least forty million tons of steel” each year, and Greenpeace estimates that this steel usage amounted to 77 million tonnes of carbon dioxide in 2021 and 74 million tonnes of CO2 in 2022. The top three biggest automaker consumers of steel were Toyota, Volkswagen, and Hyundai-Kia, and none of these companies disclose emissions data for any of their materials, making it difficult for advocates to analyze supply chain transparency and for consumers to understand the real carbon footprint of any vehicle. Critically, automakers are primed to create demand for green steel– their supply chains are less complex than other steel-consuming industries, and there is “a relatively insignificant incremental cost of a vehicle if [it is] made with low-carbon steel.” This means that automakers could easily encourage steel companies to commit to investing in clean, future-proof technologies that help accelerate the zero-emission transition.

By calling on automakers like Toyota and GM to decarbonize their supply chains, we can help the global steelmaking industry turn toward cleaner manufacturing. It’s time for steelmakers to invest in new technologies that protect our communities and Sacred Earth. Learn more about our campaign calling on Toyota and GM to commit to a clean, safe climate future for all here.

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