Green steel definition narrows, pellet alternatives sought

The market’s perception of what constitutes “green” steel is moving away from carbon offsetting and mass balancing to actual low-carbon-intensity production, although a uniform global green steel standard is unlikely. There is meanwhile likely to be a wave of investment into fines-based iron reduction processes. So concluded a panel at Wednesday’s Fastmarkets International Iron Ore & Green Steel Summit 2024.

GMK Center chief executive Stanislav Zinchenko suggested European green steel supply of over 25 million tonnes/year in 2030 may exceed demand of 20m t/y, since this demand is seemingly coming only from the automotive and clean energy sectors. Therefore, there will be no supply shortage and no big green steel premium.

There is a host of carbon-offset steel brands in the market, but “green steel, for me, is not about certificates, it’s about production with less carbon intensity,” Zinchenko told delegates at the event in Vienna attended by Kallanish. Truly green steel will have a carbon intensity of below 250kg of CO2/tonne of steel and be produced using at least 80% green hydrogen, while low-emission steel can be hydrogen based and 260-400kg/t or natural gas based and 410-600kg/t intensity, he added.

However, “we will not have globally one green steel standard or one global monitoring system. It will never happen,” Zinchenko affirmed.

In terms of technology, the blast furnace “will redefine itself” using carbon capture and low-emission iron ore pellet, said Metso direct reduced iron director Parizat Pandey. Most of the investment is happening in thermochemical reduction processes, like the shaft-based direct reduction plant, while electric smelting is another area that will feature. The pathway chosen will depend on mill location.

With so many metallics production investments being committed to, there will be a high-grade iron ore pellet shortfall. “History shows beneficiation is not easy to do,” Pandey continued, so fines-based DRI processes are likely to see significant investment.

Asked about the potential for biochar as an alternative reductant to hydrogen amid restrictive hydrogen costs, Pandey asked: “Where is the capacity for this [biochar production]?” He added: “If we are serious about decarbonisation … there is no other way of reducing iron ore without using hydrogen to knock off the oxygen.”

CCUS deployment meanwhile will be challenged by the vast costs involved and land required, he said.

Europe should consider building out nuclear power capacity to mitigate hydrogen costs and renewable energy interruptions, Zinchenko asserted. Other regions are investing in this area. “If Europe refuses this, it also refuses energy security,” he noted. However, Pandey countered by saying nuclear permitting procedures are protracted and decommissioning at the end of the plant’s life cycle poses environmental challenges.

Adam Smith Poland

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