The Importance of Green Steel for the Future of the Global Metal Industry

green steel

Green steel, also known as sustainable steel or eco-friendly steel, has emerged as a beacon of hope in the global steel industry. Green steel paves the way for a new era of sustainability and environmental consciousness for one of the world’s most harmful industries. By making a conscious effort to clean up steel, we are one step closer to tackling climate change and reaching Net Zero.

Green steel – a revolutionary alternative

Steel stands as one of the most prevalent materials globally, with annual production exceeding two million tonnes. Its versatility finds applications in constructing cars, buildings, and everyday items like cutlery and tools, sustaining a workforce of over six million individuals directly engaged in its production.

Traditional steel manufacturing relies on blast furnaces fueled by coal, oil, and natural gas, contributing roughly 8% of global CO2 emissions. Green steel offers a revolutionary alternative by using innovative technologies that drastically reduce or eliminate carbon emissions throughout the production process. 

Addressing this challenge, green steel offers a unique advantage—it can be infinitely recycled through a fully electric process with minimal emissions, presenting a compelling solution in the battle against climate change. Already, recycling satisfies 26% of global steel demand, with ongoing efforts to increase this figure. Remarkably, Spain leads with over 85% recycling rates, while countries like the Netherlands top the chart at 97.3%, underscoring varying degrees of progress across regions.

Decarbonising steel

The pressing need for climate action is mobilising the whole of society, including, of course, the entire steel value chain. Major players in the industry are announcing commitments to decarbonisation: producers like ArcelorMittal and Tata Steel, consumers such as truck manufacturer Scania, and even financial groups. Iberdrola also has an active role in this effort as the leading company in decarbonising the economy, taking part in forums and exploring ways of collaborating with a number of actors in the value chain.

The first measures for reducing emissions from steel entail making more efficient use of this material and increasing recycling rates, but this alone is not enough. Future forecasts show it will be necessary to cover at least half of the demand for steel from iron ore, so it is essential we develop new technologies that are less harmful to the environment.

Two of the most promising processes revolve around renewable electricity. In Europe, there are already several projects — Hybrit and H2 Greensteel, for example — that aim to replace fossil fuels with green hydrogen, while in the United States, Boston Metal, a company that emerged from the Massachusetts Institute of Technology (MIT), is developing direct electrolysis from iron ore, a process similar to that currently used for aluminium. In both cases, the electricity used would be from renewable sources, ensuring sustainability and no emissions during the process.

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