Hydrogen steelmaking for a low-carbon economy

The report analyzes the HYBRIT process, which replaces coal with hydrogen for the direct reduction of iron ore combined with an electric arc furnace to create fossil-free steel. While technically feasible and potentially cost-competitive depending on electricity and carbon prices, the transition faces systemic barriers including high investment risks, the need for large-scale electrolysis infrastructure, and the risk of carbon leakage in a globally competitive market.

• Steel production is a major contributor to global climate change, accounting for approximately 7% of total global carbon dioxide emissions.
• The HYBRIT process aims for fossil-free steel production by using hydrogen instead of coal for the direct reduction of iron oxide/ore (H-DR) and utilizing an electric arc furnace (EAF).
• A pre-feasibility study conducted in early 2018 indicated that HYBRIT faces no serious technical obstacles, as most required technologies are already used industrially, though commercialization may take about two decades.
• The production cost of HYBRIT steel is estimated to be 20% to 30% higher than conventional blast furnace production, making it competitive if carbon prices reach between EUR 40 and 60 per tonne of CO2.
• The H-DR route provides operational flexibility through the storage of hydrogen and hot briquetted iron (HBI), and the ability to vary the proportion of scrap steel used in the EAF.
• Compared to the H-DR route, Carbon Capture and Storage (CCS) for blast furnaces is limited by the difficulty of capturing all CO2 sources at a site and a lack of co-benefits, with potential GHG reductions limited to about 50%.
• Biomass can support decarbonisation by providing heat for secondary metallurgy and hot rolling via biomethane, or by partially substituting coke with charcoal in blast furnaces.
• The transition to fossil-free steel is hindered by political and systemic risks rather than technical ones, including carbon leakage, uncertain future market demands, and the need for new regulatory frameworks.
• The EU's current strategy to prevent carbon leakage involves providing free allocation of emission permits to energy-intensive industries, typically up to 90% of actual emissions.

APA

Åhman, M., Olsson, O., Vogla, V., Nyqvist, B., Maltais, A., Nilsson, L. J., Hallding, K., Skånberg, K., & Nilsson, M. (2018). Hydrogen steelmaking for a low-carbon economy. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2018/09/hydrogen-steelmaking-for-a-low-carbon-economy.pdf

Chicago

Åhman, Max, Olle Olsson, Valentin Vogla, Björn Nyqvist, Aaron Maltais, Lars J Nilsson, Karl Hallding, Kristian Skånberg, and Måns Nilsson. Hydrogen steelmaking for a low-carbon economy. Stockholm Environment Institute, 2018. https://www.sei.org/wp-content/uploads/2018/09/hydrogen-steelmaking-for-a-low-carbon-economy.pdf.

Wikipedia

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BibTeX

@techreport{hman2018hydrogen, author = {Åhman, Max and Olsson, Olle and Vogla, Valentin and Nyqvist, Björn and Maltais, Aaron and Nilsson, Lars J and Hallding, Karl and Skånberg, Kristian and Nilsson, Måns}, title = {{Hydrogen steelmaking for a low-carbon economy}}, institution = {Stockholm Environment Institute}, year = {2018}, month = sep, url = {https://www.sei.org/wp-content/uploads/2018/09/hydrogen-steelmaking-for-a-low-carbon-economy.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }