ArcelorMittal, the world’s biggest steelmaker, has committed to being carbon neutral by 2050. The aim is for its European business to reduce emissions by 30% by 2030.
Aditya Mittal, president and CFO, commented: “As the world’s leading steel company, we believe we have a responsibility to lead the efforts to decarbonise the steel-making process, which today has a significant carbon footprint.”
Mr Mittal said that his company’s challenge – indeed, the global steel industry’s challenge – is to be able to make steel using clean energy technologies on a commercial scale, while remaining competitive in the global steel industry.
“If the world is to achieve net zero by 2050 it will require all parts of the economy in all regions of the world to contribute,” he said, adding that ArcelorMittal was working on various pilot technologies which ‘have excellent potential’.
“In Hamburg, where we own and operate Europe’s only DRI-EAF facility, we will test not only the ability of hydrogen to reduce the iron-ore and form DRI, but also then test that carbon-free DRI in the EAF in the actual steel-making process,” Mittal said.
“Hydrogen has a lot of potential but given the significant transition cost, we also believe in working on solutions for the traditional integrated route. This essentially follows the bio-energy, carbon capture and utilisation and storage route, which as stressed by both the IPCC and the IEA will be critical to achieving net zero by 2050. What is also interesting about this route is that it has the potential not only to provide carbon neutral steel, but also other products that will help the chemical industry make plastics in a carbon neutral way.
“Critical to turning the target into reality will be policy to enable steel to remain competitive while decarbonizing – particularly given every region of the world is moving at a different pace. We intend to actively engage with governments to chart a way forward that enables the steel industry to make meaningful progress through carefully designed policy that protects against carbon leakage.”
ArcelorMittal is looking at two low-emissions steelmaking routes, both of which, it believes, have the potential to lead to carbon-neutral steelmaking. One is the Hydrogen-DRI route, using hydrogen as a reducing agent. A demonstration plant in Hamburg, where ArcelorMittal owns Europe’s only operational DRI-EAF plant, is currently planned with a targeted start-up in 2023.
Then there is the Smart Carbon route, which is based on modifying the blast furnace route to create carbon neutral steelmaking through the use of circular carbon – in the form of sustainable biomass or carbon containing waste streams – and carbon capture and use (CCU) and storage (CCS).
ArcelorMittal claims it is well advanced on constructing several commercial-scale projects to test and prove a range of Smart Carbon technologies. A start-up target for key projects is targeted in 2022.
Both routes have the potential to deliver carbon-neutral steel by 2050, but ArcelorMittal believes that Smart Carbon can deliver results sooner, and make a meaningful contribution to CO2 emissions reduction this decade.
Industrial scale production from the Hydrogen-DRI route is unlikely to be significant before 2030 due to current high costs.
Before carbon-neutral steelmaking can become a reality, however, ArcelorMittal believes there needs to be a global level playing field, which avoids the risk of carbon leakage through mechanisms such as green border adjustments. There also needs to be access to abundant and affordable clean energy and policies supporting the development of the necessary clean energy infrastructure. Furthermore, access to sustainable finance for low-emissions steelmaking and policies that accelerate the transition to a circular economy.
Expect a second climate action report from ArcelorMittal before the year-end in which the company will set out further details of its 2050 net zero plans for steelmaking.