ThyssenKrupp Steel and H2 Green Steel are lighthouse projects paving the road towards a green steel future and we are proud to be the "frontrunner" in the decarbonization of the steel industry with these projects. However, we also know that a broad, worldwide implementation of CO2 emission reducing plants and technologies will be needed moving forward, as the steel industry alone accounts for around 8% of today’s global CO2 emissions. The question is which technologies can we already leverage and how can we deliver this massive transformation in an economically feasible, globally-scalable way?
A common feature of both the TKSE and H2 Green Steel projects is that they rely on direct reduction. Several hurdles impede the exclusive adoption of this technology as the ultimate solution. The most important factor is that shaft-based direct reduction requires the use of high-quality iron ore pellets. Today, less than 40 million tons of this material is shipped to the global market. Second, the economic feasibility of widespread green hydrogen adoption remains challenging, given the scale required to meet global steel demand. Third, electricity consumption emerges as a significant factor, given the imperative to more than double renewable energy generation by 2050 to attain net-zero targets. A staggering two-thirds of the existing worldwide renewable generation capacity (approximately 2,000 GW) would need to be reserved for the steel industry. Last, but not least, the speed of this transition is also important as current limitations on plant builder capacities and funding opportunities present significant challenges. In spite of these complexities, forecasts still expect direct reduction capacity to grow from today's 117 million tons to almost 500 million by 2050, representing approximately 25% of total steel production projections.
The electric steel route is the fastest way to produce near-zero emissions steel, requiring only the use of green electricity. However, the availability of scrap sets a limit to the expansion of this process route. By 2050, the World Steel Association expects a total of 1.4 billion tons of scrap to be available each year. However, around one-third of this scrap will be used in primary steelmaking, leaving a total projection of between 850 and 900 million tons via direct scrap recycling. That would represent an increase from today's 23% to more than 35% of total steel production.
The current forecasts also show that the blast furnace route will continue to play a major role for the next three decades. In 2050, almost 40% (approximately 850 million tons) of the world’s crude steel is projected to be produced using the conventional route. That is why the conversion of blast furnaces into low CO2-emission operation is one of the key challenges to decarbonizing the steel industry.
Our answer to this is the Paul Wurth EASyMelt. This electrically assisted syngas smelter can be integrated into existing integrated steel plants, demonstrating a significant pathway for the decarbonization of existing blast furnaces worldwide. The EASyMelt represents a resource-flexible, crisis-resistant, and cost efficient alternative to direct reduction technologies and offers much lower investment and operational costs compared to direct reduction plants.
In June 2023, we signed an agreement with Tata Steel to advance and demonstrate this groundbreaking technology on an industrial level. By implementing EASyMelt, Tata Steel aims to cut CO2 emissions by over 50% compared to baseline operations, showcasing the customer’s drive towards sustainable steel production.