Steel is the most widely used material on the planet. After crude oil, it is the second-largest commodity value chain in the world. Steel making is also one of the most carbon-intensive industrial processes. As per a report by World Steel Association, 1.85 metric tons of CO2 were discharged into the environment for every metric ton of steel produced in 2020. 1.86 billion metric tons of steel were manufactured in the same year and there were 2.6 billion metric tons of total direct emissions, which is 7 to 9 % of all human-induced carbon emissions. There is no other industrial material with a bigger climate impact.
Due to its extensive industrial application, steel will become a fundamental material for global decarbonization efforts. The success of the circular economy is heavily dependent on steel, which is already one of the most recycled resources in the world.
Major steel producers and start-ups have begun to invest in alternate methods of producing steel, most commonly by converting iron oxides to iron by electrochemistry or green hydrogen.
Steel decarbonization challenges
Due to regulations around industrial carbon emissions, steel producers all around the world, but particularly in Europe, are having to deal with a decarbonization challenge. The factors behind this challenge are:
Changing consumer preferences and rising demand for eco-friendly steel products: A development that has already been noticed in a number of sectors, including the auto sector, where companies like Volkswagen or Toyota have set themselves the lofty goal of eliminating all carbon emissions from every single link in their supply chains, including their suppliers and adopting a full life cycle perspective.
Regulations of carbon emissions: This is reflected in the European Green Deal’s carbon dioxide reduction goals and the rising costs associated with carbon dioxide emissions.
Increasing public and investment interest in sustainability: The Institutional Investors Group on Climate Change, a global network with over 250 investors and over USD 30 trillion in assets under management has compelled the steel sector to take substantial action to contribute against actions for decarbonization. At the same time, the international investment corporation BlackRock reaffirmed its dedication to the growth of environmentally friendly businesses and sustainable investing.
Steelmaking: The process and primary decarbonization concerns
In order to separate oxygen from the iron oxides that make up iron ore and create the durable substance known as steel, the steel industry relies mainly (73 percent) on the blast furnace and basic oxygen furnace (BOF) technologies.
Multiple applications of extremely high heat are required to make steel. One of these involves burning coal to a temperature of around 1000 degrees Celsius without oxygen in order to remove impurities and produce “coke,” which is a far more potent substance. Along with iron ore and limestone, the cooled coke, which contains 90–93% carbon, is fed into a blast furnace process. When air heated to 1000–1200 degrees Celsius is blown into the furnace, a series of chemical reactions begin that eventually result in the production of pig iron and CO2.
The industry’s biggest problem with decarbonization is replacing the energy source. Currently, coal not only serves as the primary source of heat for the various phases of the process, but it also provides the base of the chemical reaction that separates iron from its oxidized form in iron ore. Basically, carbon is essential to fuel the process that results in CO2 as a byproduct when making steel from iron ore.
Steel Industry Not on Track
The International Energy Agency (IEA) published a report on the Iron and Steel Technology Roadmap in October 2020 that described the industry’s opportunities and difficulties. According to the report, “Steel corporations and regional steel associations, which together produce almost one-third of the world’s steel, have set aims to reach net zero emissions by 2050 or earlier,” and “most of these targets were set in the past three years.”
According to a separate tracking report, the steel industry is also clearly “not on track” to reach emission reduction targets set by the Paris Climate Accord, which is intended to limit global warming of more than 1.5 to 2 degrees Celsius relative to pre-industrial levels.
By using the most advanced technologies, better iron ores, and an optimized fuel mix in the blast furnace (BF) and blast oxygen furnace (BOF) operations, where emissions can be reduced by 10% to 30%, steel makers can make progress in reducing emissions. These initiatives are especially crucial in countries like China and India where there are a lot of these older facilities and newer technologies have the potential to significantly reduce emissions across the entire industry.
Process optimization with Eugenie’s digital twins
While several decarbonization methods are being evaluated and researched such as Electric Arc Furnace, CCU, CCS, HYBRIT, etc. However, minimizing carbon emissions from the current steel-producing process should be the first step for steel manufacturers. Advanced Industry 4.0 tools like digital twins and sophisticated process control solutions can enable steel manufacturing plants in reducing fuel and energy usage.
Eugenie’s digital twins help steel companies to fast-track decarbonization by reducing operational emissions and wastage. Our award-winning AI-based patented products have helped many industrial companies in emissions and OpEx reductions through end-to-end traceability and throughput optimization.
The Process and Emissions control module of Eugenie provides “what-if scenarios” for operational staff to continually monitor the core KPIs through visual simulations. Real-time collaboration and rapid knowledge capture enable data-driven decision-making to ensure increased throughput.
Recently, Eugenie’s solutions helped a leading Mexican mining company to reduce production downtimes and carbon emissions by 10% through AI-driven root cause analysis. Deploying Eugenie’s solutions are super-easy with actionable insights within a few days of deployment. Eugenie provides turnkey SaaS deployment, with cost-effective scaling for end-to-end operational optimization and emission monitoring.
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