Huge investments needed for low-carbon transition of Indian steel industry - Expert

• Makeshift technologies can cut emissions only by 20%
  
  
• Costs may rise by $200/t to lower emissions to 1.8 tCO2/tcs
  
  
• Investments of INR 4.5 lakh cr needed till 2030 to meet green H2 requirement
  
  
• Tata Steel scaling up CCUS pilot to 15 tpd from 5 tpd
  
  

Carbon dioxide (CO2) concentration in the atmosphere today is at the highest level in the last 8,000 years and annual global CO2 emissions is nearly 40 gigatonnes (GT).

The share of the steel industry is total emissions is 9%. Renewables, hydrogen fuel and battery technologies are moving at a fast pace in decarbonising the power and mobility sectors. However, in a business-as-usual scenario, the steel industry's share in global man-made emissions may reach 40% in the next 20-25 years, said Debashish Bhattacharjee, VP, Technology & R&D, Tata Steel.

Replacing coke

"For decarbonisation of the steel sector the focus should primarily be on the BF-BOF process, as it is the predominant route of steel production today. Emissions in the integrated process is due to usage of coke in the BF, which plays the role of a reductant, produces heat, and provides the physical structure of the BF," said Bhattacharjee.

Replacing coke as a reductant in the BF is possible through hydrogen and heating can be provided through plasma torches powered by green electricity, but coke does not have a replacement when it comes to providing the physical structure of the BF. Hydrogen use can only reduce about 15-20% of coke use in the BF.

Makeshift technologies

"Replacing coke with hydrogen, coke oven gas (COG) and biochar in the BF are all makeshift decarbonisation strategies for which we do not need to change the set up much. We just need to change the gas or reductant composition through usage of scrap in the BF, increasing the use of scrap in the BOF, introducing biochar in the BF instead of PCI, as it has a negative C02 footprint. These technologies are ready for implementation in live BFs but their CO2 reduction potential is just about 20%," he informed.

In fact, deeper decarbonisation technologies either necessitate retrofits or are transformational in nature. Naturally, the readiness level of these technologies is lower compared to makeshift technologies. For example, molten oxide electrolysis, electrowinning or even hydrogen-based DRI are transformational technologies with low readiness level.

Outlook to 2030

So, with makeshift technologies steelmakers have to rely on CCUS to control emissions. In eastern India, a major steelmaking hub, there are no proven geologic sites for sequestration of captured CO2. So, steelmakers need to rely on CO2 utilisation, the easiest way of fixing the CO2 in is methanol. Roughly, a 10 mnt/year steel plant emits 22 mnt of CO2. So, CCUS will need to be adopted to abate that 22 mnt in the absence of makeshift technologies.

"Say, in 2030, India produces 175 mnt of crude steel and the emissions intensity is reduced to 2.3 tCO2/tcs then 400 mnt of CO2 will need to be sequestered," contended Bhattacharjee. "If makeshift technologies are implemented and the emissions intensity falls to 1.8 tCO2/tcs, still we would need to capture 315 mnt of CO2. The additional cost of reducing emissions intensity to 1.8 tCO2/tcs is $200/tcs provided green hydrogen is available at $4/kg," he said.

For achieving 1.8 tCO2/tcs by 2030 India would need 60 CCU units, additional cost will be around INR 45,000 crore, additional cost for hydrogen (pegging industry requirement at 9 mnt in view of 175 mnt of steel production) will be INR 4.5 lakh crore, and power requirement will be around 60 GW.

Tata Steel has generated enough data at the mill level with its 5 tpd CCUS pilot and is planning to scale it up to 15 tpd, he informed.

Transition tasks

The key levers are using more scrap and natural gas, supplies of which are constrained. Hydrogen DRI needs green hydrogen and iron ore of high grade which, going forward, will not be Australian much less Indian ore, but South American and West African ore. Use of hydrogen, NG, and scrap through a remelter, which can use low-grade ore, is possible. However, it is not ideal due to the sheer scale of the iron and steel industry. Biomass is limited in supply and competes with agricultural land, which is a big challenge.

Currently, the key tasks are:

• High-efficiency electrolysis for hydrogen production from around 50% efficiency levels at present
  
  
• Non-electrolytic processes of hydrogen production
  
  
• Cheap and safe hydrogen storage options
  
  

Net-zero challenge

To achieve net-zero, wind energy capacity has to go up by 15%, solar by 25%, and global grid capacity almost three times that of the current level, Bhattacharjee said. Total number of EVs must rise at least 60 times. The material requirement for this is huge. Copper and nickel demand will go up by 50-70%, cobalt by 150%, lithium and graphite demand will rise 6-7 times. More than 5 billion tonnes (bnt) of steel will be required and over 9 bnt of aluminium.

"Mining these materials will be impossible and so urban mining will hold the key," he said. The government needs to prioritise green procurement policies, offer incentives for low-carbon steel, introduce carbon taxes, and facilitate urban mining.