The rust-red towers of ThyssenKrupp’s blast furnaces in Duisburg have been melting coking coal and iron ore to create pig iron for over a century. They're as much a part of this industrial city in the Ruhr valley as the local football team and the currywurst.
But the ovens’ days are numbered. ThyssenKrupp has become one of the first steelmakers to set a timetable for transitioning away from coking coal. “Industry has a duty to make its contribution to protecting the climate,” Andreas Goss, the head of the company’s steel division, told Handelsblatt.
Burning coking coal, an integral part of steelmaking, accounts for up to 38,000 kilotons of greenhouse gases a year in Germany – almost one-third of the country’s industrial emissions.
Given the EU’s goal to reduce CO2 emissions to zero by 2050, finding a greener way to make steel is a matter of survival for Europe’s steel industry. ThyssenKrupp plans to invest a total of €10 billion ($11.4 billion) in converting its process over the coming 30 years.
Steelmakers are well aware of the coming EU rules that will slash industrial CO2 emissions. European Commissioner Miguel Arias Cañete made that clear when he said that entire industries could disappear in the course of Europe’s decarbonization.
Hydrogen could be a good replacement for coking coal, but ensuring a stable supply of it will be a major challenge. Goss called on governments to give companies enough time for the conversion and to be pragmatic. “The problem must be solved scientifically and economically, not ideologically,” he said. “Deindustrializing Europe would mean that products like steel in the future would be made in other regions of the world where ecological production methods aren’t so strictly controlled.”
Many steelmakers share that concern. Firms including Germany’s Salzgitter and Austria’s Voestalpine have been testing new methods of production. Hydrogen is seen as the most suitable fuel because instead of emitting CO2, it generates H2O – water.
Unlike the traditional blast furnace, carbon-free steel production would use hydrogen to fuel a reduction process in which the iron ore is converted to sponge iron and then into steel in an electric oven.
But green steelmaking is still a thing of the future: Germany’s five biggest manufacturers, which use blast furnaces for 95 percent of their steel output, would have to completely convert their plants.
Ensuring an adequate supply of hydrogen is an additional factor. “We need pipelines that supply us with hydrogen, and the hydrogen must be available in sufficient quantities,” said Arnd Köfler, head of production at ThyssenKrupp Steel.
The company’s location is an advantage. “We in a Duisburg are in a unique position in Europe for the conversion to hydrogen-based steel production,” said Köfler. “In a radius of 200 kilometers, we have the most important industrial partners with whom we want to tackle the project.”
Goss, CEO of ThyssenKrupp's steel division since 2014, was selected in December to lead the in-process joint venture with India's Tata Steel.
Racing for breakthroughs
Voestalpine is also partnering with other firms to secure its own supply of hydrogen. The firm is working with Siemens, Austrian power company Verbund, Austrian Power Grid and other partners to build the world’s biggest research plant for producing green hydrogen, located in Linz.
The project H2Future aims to research “real breakthrough technologies that could be usable on a large-scale technical level in around two decades,” said Voestalpine CEO Wolfgang Eder.
Voestalpine would need an extra 30 terawatt hours of electricity per year to produce the hydrogen needed for its own steel production. That’s almost half of Austria’s entire power needs.
“The precondition for green hydrogen is to have sufficient renewable energy to produce enough of it competitively,” said Eder. But given Germany’s current energy mix, in which renewables barely account for a third of energy production, that goal looks distant.
ThyssenKrupp will begin its green conversion in two years, when it steps up research into using hydrogen in conventional blast furnace systems. It will then modernize and rebuild its plants in the decades ahead.
Kevin Knitterscheidt covers steel and machinery for Handelsblatt. David Crossland adapted this story into English for Handelsblatt Today. To contact the author: [email protected]