CBAM and ETS are important to support low-emission steelmaking in Europe, but access to low-cost green energy and commitment from customers will be key. Technology makers are meanwhile ready for the expected boom in orders, but there are doubts over whether all the announced low-emission steelmaking projects will actually take place. So concluded a panel at Tuesday’s Fastmarkets International Iron Ore & Green Steel Summit 2024 in Vienna.
Echoing words from Midrex board member Stephen Montague earlier in the conference, “location, location, location” is key to DRI investments, pointed out H2 Green Steel commercial director global growth and business unit hydrogen Michael Lövgren. Besides having green hydrogen and therefore green energy, offtakers need to be on board with paying premiums for higher-cost produced steel.
“The whole value chain has to entirely change,” GravitHY chief growth officer Alice Vieillefosse stressed at the event attended by Kallanish. Commitment and investments are required from both policymakers and the private sector, with electricity grids in need of revamping.
It is one thing to have raw materials access, but the French government is keen to have local competency in the production of the intermediate product – in this case, direct reduced iron/hot-briquetted iron. That is why it is supporting GravitHY, she added.
Bernhard Hiebl, head of technology beneficiation, agglomeration and direct reduction at Primetals, said his firm has the capacity to cater for the plethora of expected low-emission steelmaking projects. “The question is, how many of these projects will actually happen in the coming years? … In principle, we are ready. We are seeing that many announced projects do not start overnight.”
The solution to having to contend with lower-grade iron ore supply, meanwhile, will be to use an electric smelter. “This will be the first step to substituting blast furnace operation,” Hiebl observed. All eyes will be on the first smelter at thyssenkrupp’s Duisburg plant when it comes into operation in 2-3 years, he added.
“From the market itself, there is not much interest right now [in smelters]; everyone is talking about pellets, but at the same time we know the pellets are not there,” he added. Another option being explored by Primetals is to feed sinter into DRI plants.
HBI production will be competitive in certain locations in Europe, provided it has government support and a sufficient electrical grid, Hiebl noted.
The HBI business case works in Boden, said Lövgren, and H2GS is also looking at Portugal as a viable location for HBI production. “To create sustainable value chains, one key ingredient will be to decouple the iron from the steelmaking in the value chain,” he added.
Adam Smith Poland
