The big opportunity

Why not start smaller? Because the biggest challenge goes hand in hand with the greatest potential. Today, integrated steel mills produce around 1.3 billion metric tons of crude steel annually, accounting for 90 percent of the steel industry's CO2 emissions. Every year, more than 30 million metric tons of crude steel capacity will have to be converted to climate-neutral processes to achieve the current climate targets alone.

The time is now for SMS group to make the most of its unique core competencies, technologies, and partnerships because we are the only supplier worldwide that can provide all climate-neutral processes from a single source. From green hydrogen to direct reduction and electric steelmaking to the conversion of downstream processes - with solutions that our customers can use in the short, medium, and long term.

The future of steel production is the efficient use of raw materials such as steel scrap and iron ores and energy sources such as power from renewable sources and the green hydrogen generated from it. In the final stage of transformation, steelmakers will produce the largest share of climate-neutral steel in a hydrogen-based reduction process followed by an electric smelter.

Full range of decarbonization technologies for brownfield and greenfield projects

The pathway to carbon neutrality has to be set individually for every steel producer. In general, there are considered to be three main routes to produce high-quality low-carbon steel at scale, using significant amounts of virgin material while still being able to process scrap in order to reduce the carbon footprint depending on final product specifications. SMS group is in the unique position to supply fully integrated solutions and leading technologies from iron ore to final products on all three routes. This is particularly important, as there is no one-size-fits-all ‘best’ option.

It is very important to study carefully the conditions for each case in order to choose the best relation between carbon efficiency and competitiveness. As SMS group has experience and references in all the technologies and processes, we are in a unique position to evaluate the best-suited roadmap for any given case.

Our approach is to develop a customized roadmap for every customer on their way towards carbon-neutrality.

H2 Green Steel, Sweden

The world’s first carbon-neutral steel plant will be supplied by SMS group and is about to start-up in 2025.

Main routes

  • 30 percent CO2 reduction

    Modernization of existing blast furnaces

    More than 80 percent of greenhouse gas emissions are caused in the primary stage during hot metal production. Due to the long investment cycles for metallurgical plants, a large part of the required CO2 savings must come from the ongoing operation of existing blast furnaces.

    Therefore, it is encouraging to know that there is also considerable optimization potential for the classic blast furnace route. By retrofitting innovative, resource-saving solutions onto the existing installed equipment substantial reductions in the CO2 footprint can be reached in the short and mid-term, thereby creating a sensible balance between ambitious environmental targets and economic constraints. Our ‘blue’ blast furnace is capable of substantially reducing the carbon footprint of this established and proven technology.

    One example is the injection of hydrogen or hot synthesis gases into the blast furnace. With this measure, the CO2 footprint in pig iron production can be reduced by a considerable 30 percent.

    When revamping existing integrated metallurgical plants, it is necessary to carefully reassess the entire infrastructure as well as the energy balances and flows. This process is hardly possible without the expertise of a large-scale plant engineering company. As a holistic solution provider, SMS group offers a variety of ways to cost-effectively improve the CO2 balance of blast furnaces.

    Blue blast furnace
  • 60 percent CO2 reduction

    Gas-based direct reduction

    Direct reduction Midrex® technology is a well-established alternative to blast furnace technology when it comes to steelmaking from virgin materials. In terms of decarbonization, the Midrex® plant's carbon footprint is around 60 percent lower compared to conventional technology. In addition, it can be gradually converted to hydrogen supply so that with minor changes to the plant and its operating parameters, it can achieve complete decarbonization in the future. As a result of a construction license agreement with Kobe Steel in Japan, SMS group is able to offer Midrex® direct reduction ironmaking plants as part of its portfolio.

    For steel making, we developed the open bath furnace (OBF). The OBF is similar in design to a conventional submerged arc furnace (SAF) operated in a so-called ‘brushed arc’ mode. Here, we count on several hundreds of references for these kind of furnaces. The main feedstock on this route remains BF-grade iron pellet, while scrap can again be added in the steelmaking plant. One noteworthy advantage is the ability to add iron bearing wastes (up to 3 to 5 percent of overall charge), such as BF and BOF dust, mill scale and others within the smelter.

    Midrex plant at Algerian Qatar Steel
  • Net-zero vision becoming reality

    The carbon-neutral steel plant

    In a greenfield project and with green hydrogen available at competitive prices in sufficient quantities, a completely different approach can be adopted. Pre-reduced DR grade iron ore pellets from a Midrex® shaft are hot charged into an electric arc furnace. No intermediate step is required and – depending on the specified final grade – only minor carburization is needed to reduce the nitrogen in the steel. From the very beginning, scrap can be added to the furnace at higher rates, with only the quality requirements of downstream processing stages setting an upper limit here.

    Due to the immediate connection of all facilities, this route has the potential to come closest to carbon neutrality. This is especially so when the lean concept is extended downstream with a highly efficient CSP® or CSP® Nexus plant, which is a combined thin slab casting and direct rolling plant.

    Zero-carbon steel mill

Selected references

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