The global steel industry accounted for over 7% of global greenhouse gas (GHG) emissions and over 11% of global carbon emissions. The Hydrogen Direct Reduced Iron (H2-DRI) process utilising green hydrogen made with renewable/no-carbon electricity promises significant emission reductions and a transition to greener steel production in the sector. The adoption of green H2-DRI-EAF steelmaking involves financial considerations varying by country, influenced by hydrogen costs and carbon pricing mechanisms.
The study “Green Steel Economics: Comparing Economics of Green H2-DRI and Traditional Steelmaking Around the World” prepared by Global Efficiency Intelligence, TransitionAsia, Solutions for Our Climate assesses the costs of green H2-DRI-EAF steelmaking compared to traditional Blast Furnace-Basic Oxygen Furnace and Natural Gas Direct Reduced Iron-Electric Arc Furnace routes across seven major steel-producing countries, including the U.S., EU, China, Japan, South Korea, Brazil, and Australia. It utilises a detailed financial model to calculate the levelized cost of steel (LCOS) using expenses such as capital investments, raw materials, labour, and energy costs, adjusting for varying levels of hydrogen use.
The key questions answered by this report are:
1) How much is the green steel premium per ton of steel in each country?
2) How much is the green steel premium per unit of final product (car, building, ship) in each country?
3) How different H2 prices and carbon pricing can influence the green steel premium in each country?
Access the complete report here
