ArcelorMittal Belgium faces Steelanol challenges amid regulatory constraints
The €215 million ($248m) industrial-scale carbon capture and utilisation (CCU) Steelanol facility operated by ArcelorMittal in Ghent, Belgium, may face a shutdown. The steelmaker warns that the plant is not profitable due to current EU regulations.
ArcelorMittal, however, assures that it will continue its dialogue with policymakers at the Flemish, national, and European levels in pursuit of viable solutions to the challenges facing its operations. The steelmaker’s CO2 reduction roadmap in Belgium is anchored on energy efficiency, greater circularity through scrap use and electrification, and the deployment of smart carbon technologies. Key initiatives include carbon-to-ethanol conversion, and carbon storage.
ArcelorMittal Belgium’s largest investment to date is the Steelanol plant, approved in 2017. The project reflects the company’s view that a combination of technologies is essential to achieve CO2 reduction targets. The plant produces ethanol for both the chemical and fuel markets, but despite securing a sustainability certificate for chemical-sector supply in mid-2024, certification for fuel use remains pending, the company warns.
In Gent, blast furnace B operates with a mix of fossil coal and biocoal from the Torero plant. Part of the BF gas is processed by Steelanol. The two key objectives are to produce bioethanol in line with biocoal use and reduce recycled fuel tied to fossil coal use. However, EU rules adopted after the plant’s approval result in far lower recognised bioethanol volumes than initially planned.
“To have ethanol recognised as recycled fuel, we must demonstrate that its CO2 footprint is at least 70% lower than an external fossil reference. This calculation must include the electricity no longer produced (Steelanol uses part of the gas to make ethanol, which is no longer available for Engie’s power plant). Because Steelanol is connected to the Belgian electricity grid (which still has a relatively high CO₂ footprint), we do not meet this target. If Steelanol were connected to the French grid (which has a low CO₂ footprint due to many nuclear plants), we would meet the target. ArcelorMittal Belgium expected that the CO₂ savings from Steelanol could be deducted from the total emissions of our cluster. According to new regulations, this is only allowed if the CO₂ is stored for a very long period (centuries). Use in fuels does not count, as the CO₂ is eventually released during combustion. Yet, Steelanol does reduce total CO₂ emissions because our ethanol replaces fossil fuels. Even for ethanol sold to the chemical sector, we are not allowed to deduct the CO₂ emissions. The difficulties in getting ethanol recognised as biofuel (when using biochar), as recycled fuel (when using fossil coal), and the fact that we cannot count the CO₂ savings from Steelanol, make it very difficult to make the project profitable—despite its great potential,” the steelmaker explains in a note obtained by Kallanish.
Last year Steelanol increased its ethanol production to a level that allows large-scale shipping via barge. ArcelorMittal’s partner LanzaTech acquired the first barge shipment last year, with the ethanol in transit for purification and subsequent sale to LanzaTech’s CarbonSmart customers.
In partnership with LanzaTech, Primetals and ERM, ArcelorMittal designed the Steelanol unit, the first of its kind in Europe, to capture carbon-rich waste gases from steelmaking. They are biologically converted into advanced ethanol through LanzaTech’s bio-based process. The ethanol produced has the potential to be marketed directly to fuel sectors or undergo additional purification or conversion for application in various consumer goods, including clothing and packaging solutions (see Kallanish passim).
Natalia Capra France
