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For the first time, European steelmakers consider the phase-out of blast furnaces for primary steelmaking. This marks a watershed for the steel industry and it would be a crucial step for European climate action. The article reviews activities for low-carbon steelmaking of European steelmakers.
ENVIRONMENT 59 May/June 2019
1 Lund University, Environmental and Energy Systems Studies, Box 118, 22100 Lund, Sweden
2 Fraunhofer Institute for Systems and Innovation Research ISI, Breslauer Str. 48, 76139 Karlsruhe, Germany
Can we fi nd a market for green steel?
The race is on to  nd an alternative and greener way to make steel away from the  re and brimstone
associated with traditional methods. Higher prices for ‘green steel’,however, will mean that new
markets must be found, argues Marlene Arens1,2, Valentin Vogl1
FOR the  rst time, European steelmakers
consider the phase-out of blast furnaces
for primary steelmaking. This marks a
watershed for the steel industry and it
would be a crucial step for European
climate action. The Paris Agreement sets
the pace for climate action. It reaf rms the
goal to keep global warming to well below
2 °C versus pre-industrial levels and that
efforts should be pursued to stay below 1.5
°C. The latter means that carbon neutrality
must be achieved globally by mid-century,
whereas the 2 °C target means net-zero
between 2070 and 2085.
The EU’s current 2050 goal is an 80
- 95% emission reduction against 1990
levels, but in an attempt to bring policy
in line with the Paris Agreement, the
Commission has suggested a new net-zero
emissions target by 2050. Some countries
passed their own targets with increased
ambition, such as Sweden’s carbon
neutrality by 2045 and Germany’s carbon
neutrality by 2050.
The steel industry is one of the largest
industrial greenhouse gas emitters
and accounts for about 5-7% of total
anthropogenic carbon dioxide emissions.
Converting an existing steel plant into one
without carbon dioxide emissions is far
from trivial. Europe is home to only a few
dozen blast furnaces, but each is built to
last for two decades or more and each is
worth hundred millions of Euros. Still, the
answer to the question which future these
industrial giants might have in Europe has
changed in recent years, but it is obvious
that reaching future climate targets requires
action today.
Back in the mid-2000s the answer
seemed to lie in carbon capture and
storage (CCS). The 40 million Euro Ulcos
project aimed at reducing carbon dioxide
emissions in the steel industry by at least
50% through capturing  ue gases from
steel plants and transporting the carbon
dioxide to safe underground storage sites.
Three out of the four selected technologies
within that project relied on carbon
capture and storage but so far, CCS in the
EU steel industry has not made it beyond
the research and development phase. The
economic crisis in 2009 and the years
after pushed economic survival on top of
the agenda, but CCS also faced a major
barrier as public acceptance declined and
citizens grew increasingly concerned about
living on top of carbon dioxide storage
sites. Consequently, carbon capture and
storage stepped down the agenda and the
development of the Ulcos technologies
Yet, in recent years and months there is
Green steel Marlene.indd 1 22/05/2019 16:06:13
May/June 2019
growing news on replacing coal-based blast
furnaces with iron- and steelmaking based
on hydrogen.
SSAB in a consortium with LKAB and
In April 2016, three Swedish companies
formed the HYBRIT consortium that
aims at carrying through the transition
to fossil-free steelmaking in Sweden and
Finland. The partners are the steelmaker
SSAB, Europe’s single iron ore mining
company LKAB, and the power company
Vattenfall. In their vision, ironmaking will be
based on a direct reduction process using
renewable hydrogen produced through
electrolysis, and using electric arc furnaces
for steelmaking.
A pre-feasibility study was conducted
between 2016 and 2017, and is now
followed-up by a four year research
programme. This rst research programme
contains research in fossil-free mining
and pelletising, electrolysis and hydrogen
storage, as well as iron- and steelmaking
with renewable hydrogen. In parallel, a
direct reduction pilot plant with a capacity
of about 1 ton per hour is being built
in the northern Swedish city of Luleå,
where trial runs are set to start in 2020.
A demonstration plant as the subsequent
stage is scheduled for 2025. All of these
activities are supported by the Swedish
Energy Agency.
In 2025, SSAB will replace its two blast
furnaces with a total capacity of 1.8 Mt
in Oxelösund with electric arc furnace
steelmaking. By 2040, Sweden’s third and
last blast furnace in Luleå is scheduled to
be replaced, as well as the two Finnish blast
furnaces in Raahe. In parallel, hydrogen
direct reduction plants will be built to
supply iron to the arc furnaces.
Four European steelmakers now suggest
hydrogen as the way forward to cut
carbon dioxide emissions. In summer
2016, voestalpine announced a strategic
co-operation with a power utility on
renewable energy and the provision of
hydrogen. “voestalpine plans to consistently
decarbonise steel production step by step
and make the shift in the long term from
coal to a possible utilisation of CO2-
neutral hydrogen”, Wolfgang Eder, CEO
of voestalpine stated. However, already
three years earlier, in 2013, voestalpine
announced an investment in a 2-million-
tonne natural gas-based direct reduction
plant in Corpus Christi, Texas, as being
a fundamental step in achieving the
company’s internal energy and climate
goals. The plant started operation in
October 2016 and half of its production
is shipped to the company’s Austrian
plants. The consecutive step of shifting
from natural gas-based direct reduction to
hydrogen-based steelmaking is not a big
step, industry experts claim.
Next to the natural-gas based direct
reduction facility in the US, voestalpine
announced the development of the back
then world’s largest PEM electrolyser, a
low-temperature electrolysis, in 2017. It
is located at Linz and is partly funded by
the European Union under the H2Future
project. It has a capacity of 6 MW and will
produce 1200 m³ of hydrogen per hour. Full
operation is scheduled for spring 2019.
The third pillar of voestalpine’s
decarbonisation pathway is the hydrogen
plasma smelting reduction research
activities in Donawitz that aims at directly
producing steel from iron ore nes. An
upscaling from 100g to a 50kg batch
operation is planned, leaving still some way
to go until a commercial scale is achieved.
Plasma smelting reduction would replace
current blast furnaces and basic oxygen
furnaces as well as coke and sinter making.
Salzgitter, a German steelmaking company,
proposes a tighter schedule for its transition
to hydrogen. Already by 2025, the
company aims to reduce its carbon dioxide
emissions by 25%. By 2030, carbon dioxide
emissions shall be cut by 50% and by 2050,
the target is 90-95%. While voestalpine
sets its sights on plasma smelting reduction,
Salzgitter goes for hydrogen-based direct
reduction plants. Direct reduction plants fed
with natural gas are commercially available
and a proven technology. Feeding them
with hydrogen is expected to be possible.
Direct reduction plants replace blast
furnaces as well as coke and sinter making.
For steelmaking, current basic oxygen
furnaces have to be replaced with electric
arc furnaces.
In October 2018, Salzgitter announced
the development of a reversible high-
temperature SOEC electrolysis that should
be ready for green hydrogen production
by 2020. In regular operation, the plant
shall produce 200 standard cubic metres of
hydrogen per hour. Salzgitter includes green
electricity production in its project: next to
the electrolysis, seven wind turbines shall
be erected, three directly located on the
steel site. The hydrogen will be used in the
annealing facility, but in the long term, it
shall be used to replace coal in ironmaking.
In January 2019, ThyssenKrupp announced
a strategy based on hydrogen. While their
agship project until then, carbon2chem,
aimed at carbon capture and usage, they
now focus on hydrogen-based direct
reduction plants. These are planned to
replace all their blast furnaces by 2050.
The transition phase shall start in 2021
evaluating the extraction and consumption
of hydrogen in current blast furnace
based steelmaking. The company plans
Green steel Marlene.indd 2 22/05/2019 16:06:15
investments of 10 billion Euros until 2050. As Germany’s largest
steelmaker, ThyssenKrupp has a signicant impact on the low-carbon
transition in this industry.
The latest announcement on hydrogen in steelmaking came from
ArcelorMittal in March 2019. The company will build a direct
reduction facility next to its MIDREX plant in Hamburg, Europe’s
single natural gas-based direct reduction facility. They envision
demonstration scale with a capacity of 100kt/yr. In a rst step, the
hydrogen will be provided from the top-gas of the current MIDREX
plant (grey hydrogen). Later on hydrogen produced from renewable
energies may be used (green hydrogen). In contrast to its competitors,
the site of ArcelorMittal Hamburg already has an electric arc furnace
and experience in natural gas-based steelmaking. Using grey hydrogen
allows for economical operation, the company claims.
With the announcements of ThyssenKrupp and ArcelorMittal, two
large-scale steelmaking companies have now joined the group of
smaller, but forerunning steelmaking companies that render the
possibility to substitute the use of coal with hydrogen. This is a
double milestone. For the rst time European steelmakers consider
the phase-out of coal-based blast furnaces for primary steelmaking.
Furthermore, these companies represent the majority of European
primary steelmaking companies. The carbon dioxide reductions now
discussed are more in line with the Paris Agreement than any other
propositions. The Ulcos project, for instance, aimed at carbon dioxide
reductions of 50% compared to steelmaking processes at that time.
Ironmaking based on renewable hydrogen has the potential to cut
carbon dioxide emissions by up to 95%.
However, not a single tonne of low-carbon primary steel is on the
market so far, and companies have not undertaken investments in
commercial plants up to now. Yet, ArcelorMittal claims that running
its direct reduction plant with grey hydrogen allows for economical
operation already today.
The next years or maybe even months may be crucial. Major blast
furnace capacities are due for relining. Once they have undergone this
renewal, they ought to run for another two decades. Yet, to reach
future climate targets, action should start today. With its Innovation
Fund, the European Commission aims to support the low-carbon
transition of the steel industry, but investment support is not enough.
The operating costs of green hydrogen-based steelmaking still exceeds
the current coal-based process despite the European Emission Trading
System (EU ETS) or - in other words - due to the vast exemptions
given under the EU ETS. If the EU and European steelmakers strive for
a low-carbon transition, they need to nd a market for green steel,
since it comes with a higher price tag.
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Steel Times Int 05_06_19.indd 1 04.03.19 09:11
Green steel Marlene.indd 3 22/05/2019 16:06:20
... Several other steel producers (e.g. Voerstalpine, Salzgitter, ArcelorMittal, Thyssenkrupp) have since followed suite and initiated their own research and development projects to explore options to replace coal and coke with hydrogen as reductant and energy source (Arens and Vogl, 2019;Toktarova et al. 2020). A partial shift from iron ore pellets production to increased production and exports of hydrogen DRI in Sweden as proposed by Toktarova et al. (2020) would result in an additional electricity demand of approximately 20 TWh (assuming that 6 Mt hydrogen DRI pellets are produced for exports each year) while only replacing a small share of the 150 Mt of iron ore imported to the EU each year. ...
... A partial shift from iron ore pellets production to increased production and exports of hydrogen DRI in Sweden as proposed by Toktarova et al. (2020) would result in an additional electricity demand of approximately 20 TWh (assuming that 6 Mt hydrogen DRI pellets are produced for exports each year) while only replacing a small share of the 150 Mt of iron ore imported to the EU each year. In any case, as the operating costs of green hydrogen-based iron and steelmaking still significantly exceeds the current coal-based process (Arens and Vogl, 2019;Toktarova et al. 2020), a switch to low-CO 2 primary steel production anywhere in would require a carbon price significantly higher than found in any of the emission trading systems in force today or that new markets niches with a higher willingness to pay are created. ...
Conference Paper
The aim of this study is to assess the potential for and challenges associated with increased industrial electrification. In a carbon constrained world, as all sectors of the economy seek to lower emissions, competition for energy carriers with a low climate impact (biomass/biofuels, 'green' electricity and hydrogen) will grow. Thus, how integration in this case of electrified industrial processes is managed and how interlinkages and interactions between both the supply side and demand side of the electricity system is handled will be key to the overall outcome with respect to overall systems costs, total capacity needs and security of supply. Estimates of EU industry electricity demand in 2050 vary considerably. Depending on assumptions with regards to for example overall industry activity levels, choices of energy carriers and process technologies, estimates of industrial electricity demand in 2050 available in the literature vary from 1,000 to 4,430 TWh (from approximately 1000 TWh in 2020). Based on experiences from two recent research project and a review of recent literature we outline and discuss five areas which will be critical to the potential for and outcome of a move towards increased electrification of industrial processes in the European Union. We discuss how high geographical concentration of industrial loads in particular regions, in combination with significant changes on both the supply side and demand side of the electricity system (i.e. transports and residential heating) post 2030 will pose significant challenges. But also describe, how new options for process designs, production planning, optimisation and automation may provide benefits beyond CO 2 emission reduction and how careful proactive planning provide opportunities for synergies.
... There is increasing debate on using hydrogen instead of coal and thus potentially making this process greenhouse-gasneutral [32]. A pilot plant for steel production with hydrogen is being built in Sweden [33]. In Germany, steel manufacturers are trying to replace some of the coal in the blast furnace with hydrogen. ...
Full-text available
Sustainable chemicals and materials management deals with both the risks and the opportunities of chemicals and products. It is not only focused on hazards and risks of chemicals for human health and the environment but also includes the management of material flows from extraction of raw materials up to waste. It becomes apparent meanwhile that the ever-growing material streams endanger the Earth system. According to a recent publication of Persson et al., the planetary boundaries for chemicals and plastics have already been exceeded. Therefore, sustainable chemicals and materials management must become a third pillar of international sustainability policy. For climate change and biodiversity, binding international agreements already exist. Accordingly, a global chemicals and materials framework convention integrating the current fragmented and non-binding approaches is needed. The impacts of chemicals and materials are closely related to climate change. About one third of greenhouse gas (GHG) emissions are linked to the production of chemicals, materials and products and the growing global transport of goods. Most of it is assigned to the energy demand of production and transport. GHG emissions must be reduced by an expansion of the circular economy, i.e., the use of secondary instead of primary raw materials. The chemical industry is obliged to change its feedstock since chemicals based on mineral oil and natural gas are not sustainable. Climate change in turn has consequences for the fate and effects of substances in the environment. Rising temperature implies higher vapor pressure and may enhance the release of toxicants into the atmosphere. Organisms that are already stressed may react more sensitively when exposed to toxic chemicals. The increasing frequency of extreme weather events may re-mobilize contaminants in river sediments. Increasing chemical and material load also threatens biodiversity, e.g., by the release of toxic chemicals into air, water and soil up to high amounts of waste. Fertilizers and pesticides are damaging the biocoenoses in agrarian landscapes. In order to overcome these fatal developments, sustainable management of chemicals and materials is urgently needed. This includes safe and sustainable chemicals, sustainable chemical production and sustainable materials flow management. All these three sustainability strategies are crucial and complement each other: efficiency, consistency and sufficiency. This obligates drastic changes not only of the quantities of material streams but also of the qualities of chemicals and materials in use. A significant reduction in production volumes is necessary, aiming not only to return to a safe operating space with respect to the planetary boundary for chemicals, plastics and waste but also in order to achieve goals regarding climate and biodiversity.
... However, with the exception of a few studies (e.g. Arens and Vogl, 2019;Vogl et al., 2020), research on the opportunities and challenges of developing a market for green steel products is virtually non-existent. ...
The creation of a market for steel produced by less carbon-intensive production processes, here called ‘green steel’, has been identified as a means of supporting the introduction of breakthrough emission reduction technologies into steel production. However, numerous details remain under-explored, including exactly what ‘green’ entails in the context of steelmaking, the likely competitiveness of green steel products in domestic and international markets, and potential policy mechanisms to support their successful market penetration. This paper addresses this gap through qualitative research with international sustainability experts and commercial managers from leading steel trade associations, research institutes and steelmakers. We find that there is a need to establish a common understanding of what ‘greenness’ means in the steelmaking context, and to resolve various carbon accounting and assurance issues, which otherwise have the potential to lead to perverse outcomes and opportunities for greenwashing. We identify a set of potential demand-side and supply-side policy mechanisms to support green steel production, and highlight a need for a combination of policies to ensure successful market development and avoid unintended consequences for competition at three different levels: 1) between products manufactured through a primary vs secondary steelmaking route, 2) between ‘green’ and traditional, ‘brown’ steel, and 3) with other substitutable materials. The study further shows that the automotive industry is a likely candidate for green steel demand, where a market could be supported by price premiums paid by willing consumers, such as those of high-end luxury and heavy-duty vehicles.
... Thus, there is a need for a binding global framework agreement on substances aiming to replace the current fragmented approaches and non-binding exchange forums like SAICM. [Arens & Vogl 2019]. In Deutschland erproben die Stahlhersteller, im Hochofen einen Teil der Kohle durch Wasserstoff zu ersetzen, was allerdings nur begrenzt möglich ist. ...
Full-text available
Stoffpolitik geht über die klassische Chemikalienpolitik weit hinaus. Der Begriff „Stoff“ wird in dieser Publikation umfassender verstanden. Er umfasst neben Chemikalien auch Rohstoffe, aus denen Chemikalien isoliert oder hergestellt werden, sowie Produkte und Erzeugnisse, die aus Chemikalien zusammengesetzt sind. Auch Abfälle – Produkte, derer sich der Mensch entledigen will, - bestehen aus Chemikalien und sind Stoffe. In einem Positionspapier hat der BUND die „Herausforderungen für eine nachhaltige Stoffpolitik“ beschrieben [BUND 2019a]. Dieses Hintergrundpapier soll ergänzend zum Positionspapier exemplarisch erläutern, welche Bedeutung eine nachhaltige Stoffpolitik für andere umweltpolitische Handlungsfelder hat, insbesondere für den Klimaschutz und den Erhalt der Biodiversität. Stoffpolitik muss sich an den Leitbildern Vorsorge und Nachhaltigkeit orientieren. Nach dem Vorsorgeprinzip muss gehandelt werden, wenn triftige Gründe zur Besorgnis vorliegen, wobei es noch keines schlüssigen Beweises eines ursächlichen Zusammenhangs bedarf [OSPAR 1992]. Dies wurde nicht immer rechtzeitig beachtet, wie die Publikationen der Europäischen Umweltagentur „Late Lessons from Early Warnings“ [EEA 2001 und 2013] zeigen. Nachhaltigkeit bedeutet, die Bedürfnisse der heutigen Generation zu befriedigen, ohne die Bedürfnisse künftiger Generationen zu beeinträchtigen [UNCTAD 1992]. Dies schließt auch eine Verteilungsgerechtigkeit zwischen Nord und Süd sowie innerhalb europäischer Gesellschaften ein. Die Vollversammlung der Vereinten Nationen beschloss 2015 siebzehn Ziele für eine nachhaltige Entwicklung bis 2030 (Sustainable Development Goals, SDG) [UNO 2015]. Hierzu zählen etliche umwelt- und gesundheitsbezogene Ziele wie sauberes Trinkwasser oder Schutz von Land- und Meeresökosystemen oder Erhalt der Gesundheit durch geringere Gefährdung durch gefährliche Chemikalien und Verschmutzung von Wasser, Boden und Luft. Diese Ziele nehmen Bezug auf stoffliche Belastungen. Insbesondere das Ziel einer nachhaltigen Produktion und eines nachhaltigen Konsums (SDG 12) erfordert stoffpolitisches Handeln. Klimawandel und Biodiversitätsverluste sind anerkannte globale Herausforderungen für eine internationale Umweltpolitik. In internationalen Übereinkommen (Paris-Übereinkommen 2015, Konvention über die biologische Vielfalt 1992) haben sich die Staaten verpflichtet, ihre Politik an konkreten Zielen (maximale Erhöhung der globalen Durchschnittstemperatur um deutlich weniger als 2,0 °C, möglichst nur um 1,5 °C, 20 Aichi-Biodiversitätsziele bis 2020 [Universität Regensburg 2020]) auszurichten (siehe Kasten). Damit soll eine deutliche Wende der bisherigen Entwicklung erreicht und die diesbezüglichen planetaren Leitplanken wieder unterschritten werden. Klimawandel und Biodiversität stehen dabei in engem Zusammenhang. Beispiele sind: Erhöhte Wassertemperaturen und die Versauerung der Meere führen zum Ausbleichen und Absterben von Korallenriffen. Das Abschmelzen der Polkappen und die Verschiebung der Vegetationszonen Richtung Pole gefährdet den Lebensraum bedrohter Arten. Der verstärkte Anbau von Energiepflanzen zur Substitution fossiler Brennstoffe führt zur Flächenkonkurrenz und insbesondere in den Ländern des Südens zur Vernichtung natürlicher Lebensräume. Stoffliche Belastungen stellen eine vergleichbare, globale Herausforderung dar, sind jedoch bisher nur, durch Übereinkommen geregelt, die einzelne Aspekte regeln und nicht durch eine umfassende und rechtsverbindliche internationale Konvention. Stoffliche Belastungen stehen in einem engen inhaltlichen Zusammenhang zu Klimawandel und Biodiversitätsverlusten (Abb. 1). In diesem Papier sollen einige dieser Zusammenhänge dargestellt und die sich daraus ergebenden Schlussfolgerungen beschrieben werden. Dabei werden Stoffe auf ihrem ganzen Lebensweg von der Gewinnung der Rohstoffe bis zur Beseitigung als Abfall (oder Wiederverwertung als Produkt) betrachtet. Kapitel 2 stellt die Grundzüge einer nachhaltigen Stoffpolitik dar. In Kapitel 3 werden die Einflüsse stofflicher Belastungen auf den Klimawandel erörtert; Kapitel 4 erläutert, welche Folgen der Klimawandel auf Wirkung und Verhalten von Stoffen hat. Wie sich Stoffe auf Verluste der Biodiversität auswirken, wird in Kapitel 5 dargestellt. Kapitel 6 verdeutlicht den Beitrag nachhaltiger Chemie zum Schutz von Klima und Biodiversität, bevor im abschließenden Kapitel 7 Empfehlungen und Schlussfolgerungen gegeben werden.
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