G V Sanjay Reddy Highlights the Crucial Role of Green Steel in Renewable Energy

When it comes to developing our future infrastructure, steel stands out as an indispensable resource. Despite some advancements from coal to coking coal, steel manufacturing remains an energy-intensive process, predominantly relying on fossil fuels. This sector is responsible for approximately 7-9% of all direct emissions from fossil fuels globally, with coal combustion being the primary contributor. G V Sanjay Reddy envisions a future dominated by renewable energy and provides insights on how to drive our progress towards green steel, thereby minimizing coal dependence.

The International Energy Agency forecasts a 50% increase in renewable energy capacity between 2019 and 2024, equivalent to an additional 1,200 GW—comparable to the current total power capacity of the United States. Solar energy is expected to contribute about 60% of this growth, with onshore wind accounting for 25%. Given these developments, steel will be integral to all renewable energy projects, particularly solar and wind. For instance, each new MW of solar energy requires 35 to 45 tonnes of steel, while each new MW of wind energy needs 120 to 180 tonnes.

Despite these positive trends, the steel industry must overcome significant challenges in reducing carbon emissions. Energy constitutes 20 to 40% of the cost of steel production, making ‘green steel’ economically unfeasible for most major producers. However, the use of electric arc furnaces, which utilize natural gas and hydrogen to melt recycled steel and iron, is a promising development. Currently, 30% of the world’s steel is produced this way. While recycling remains a priority to lessen the demand for new steel, there is still a need for new steel production.

In a notable development, Sweden has delivered the world's first batch of ‘green steel’ produced without coal. Hybrit, a Swedish company, has supplied this steel to Volvo AB for a test run before full-scale commercial production begins in 2026.

GV Sanjay Reddy highlights that coal-fired steel production contributes about 8% of global greenhouse gas emissions. Hybrit’s pilot facility in Lulea, northern Sweden, is pioneering the use of renewable electricity and hydrogen to replace coking coal in ore-based steel production. Hydrogen plays a critical role in the EU's objective to achieve net zero greenhouse gas emissions by 2050.

With significant advancements in hydrogen energy, the combination of hydrogen with renewable energy could pave the way for a new method of producing carbon-free steel. Transitioning to green steel is vital, as using hydrogen in the iron ore and steel industry could reduce the reliance on coal imports. The Indian government, as noted by Steel Minister Ram Chandra Prasad Singh, has an ambitious hydrogen strategy. The industrial use of hydrogen has seen substantial growth, from 22 million tonnes in 1991 to 120 million tonnes in 2021-22.

In conclusion, as we build a sustainable future, green steel must be a key component. The ideas presented are valuable, but rapid development into mainstream technologies is necessary. Accelerating the progress needed for zero-carbon steel production will require significant investment in innovation from both government and private sectors.

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GV Sanjay Reddy