European steel industry decarbonisation is inevitable, but the prohibitive cost of hydrogen steelmaking technology and energy means Poland will remain reliant on blast furnace steelmaking for years to come. This was the conclusion of the steel industry panel at last week’s European Economic Congress (EEC) in Katowice.
Tomasz Slezak, ArcerlorMittal Poland head of corporate governance & government affairs, head of energy & environment office, said the implementation of EU climate policy is happening too fast and not motivating non-EU mills to reduce carbon emissions.
Marek Frydrych, chief executive of Huta Czestochowa (HCz) lessee Sunningwell, however, said the EU carbon border tax must be implemented immediately. “We were offered slab earlier this year at the same price as an eastern mill was selling plate in Europe,” he observed at the event monitored by Kallanish. “If Huta Czestochowa didn’t exist today we would be flooded by Ukrainian and Russian imports.”
Carbon-free steelmaking technology is within reach, but this does not mean it will be implemented quickly, Slezak pointed out. “Maybe in the next two decades the technology will mature to the point it can be used by the EU steel industry, but this requires huge energy sources which don’t exist in the EU,” he commented. The estimated cost for producers is exponential. “Business will not be able to afford this without state support,” he added.
Ceo of Polish merchant coke producer Koksownia Czestochowa Nowa, Marek Serafin, meanwhile, said hydrogen technology will develop in the long term, but in the shorter term “…we have to learn to live with the existing technologies.” For electric arc furnace steelmaking to expand, you need a supply of electricity which is prohibitively expensive in Poland, he said, adding he does not see an immediate alternative to blast furnace steelmaking using coke.
Polish Steel Association (HIPH) head Stefan Dzienniak agreed, adding that although EAF steelmaking is on the rise, it is dependent on scrap which is in limited supply. He also said direct reduced iron technology is unlikely to take off in Europe, despite it being more environmentally friendly than coke-based steelmaking, because it is prohibitively expensive.
Frydrych pointed out that although HCz is an electric arc furnace mill using mainly scrap, 30% of its feedstock mix is still accounted for by iron ore products, making blast furnaces essential. He expressed concerns over potential energy shortages in Poland in the coming years and said HCz is therefore looking into establishing an incineration plant to generate electricity.
HCz’s ceo also said the shortage of young skilled workers is a serious issue in Poland’s steel industry. “If we’d want to commission a second line, I don’t know where we would get 200 extra workers from,” he lamented.
