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H2 Green Steel factory
Artist's Concept of H2 Green Steel factory. Image credit: H2 Green Steel

Green Economy

H2 Green Steel Books 1.5 Million Tons Of Pre-Orders

Sweden is leading the way toward a low carbon economy and green steel is a big part of that initiative.

If you read CleanTechnica on a regular basis, you may think electric cars are the key to a sustainable future. They’re not. They are important, of course, but they are just part of the mix. Other industries such as steel, cement, and mining also contribute large amounts of the carbon emissions that are driving global heating. Sweden seems to be home to a number of companies that take the reduction of carbon emissions seriously. One of them is H2 Green Steel, headquartered in Stockholm, which is building new factories that use green hydrogen instead of traditional blast furnaces to manufacture steel with 90% lower carbon emissions.

On its website, the company describes its mission this way: “H2 Green Steel is on a mission to undertake the global steel industry’s greatest ever technological shift. Decarbonization is a necessity, and we need to act now. We are committed to accelerating change by eliminating almost all CO₂ emissions from the steel production process. Disruptive technology, digital leadership, and our commitment to making a difference will help move the needle towards a more sustainable future.”

It’s one thing to have a vision and a desire to help preserve the Earth as a place where humans can survive. It’s quite another thing to do so profitably. H2 Green Steel announced this week that it has already signed contracts for 1.5 million tons a year of its low carbon steel, even though its first factory is still three years away from completion. When production begins in 2025, it will have an annual capacity of 2.5 million tons.

“When we launched H2 Green Steel about a year ago, we kicked the transformation of the steel industry into a new gear and other players in the industry have moved up their timelines. We are leading the way, showing that it is possible to transform the carbon-intense steel industry quickly, and others are speeding up and stepping up. This is exactly what we want. On top of that, the feedback from customers has been phenomenal and their long-term commitments are key for us to scale up further,” says Henrik Henriksson, CEO of H2 Green Steel, in a press release.

The technology for making green steel is there, the company says, and customers are willing to pay a premium for it. When a reasonable polluters-pay-principle is in place and put in product cost calculations, the business case for green steel will be even stronger.

“Presently, the term green steel can mean different things. To us it means steel produced from a combination of a significant amount of green virgin iron and scrap in a production process which uses electricity from renewable energy sources and where the total CO2 emissions are more than 90 percent lower than that of traditional steelmaking in a blast furnace process. Recycling scrap is part of the equation, but it will not be enough to meet the global demand for steel. We need to make sure that all the new steel is truly sustainably produced,” says Henriksson.

Green Hydrogen

Whenever you hear the word “hydrogen,” you should be on alert. Lots of fossil fuel companies are trumpeting hydrogen, but they make it from coal, oil, or methane. The end result is hydrogen, but there are significant carbon emissions involved in the process. H2 Green Steel will use hydrogen made by electrolyzers powered exclusively by renewable energy.

Today there is gray hydrogen (made from coal or oil), blue hydrogen (made from methane), and green hydrogen (made by splitting water molecules into hydrogen and oxygen using electricity.) Obviously, the source of that electricity is crucial. Using electricity from a coal generating station pretty much makes a mockery of the whole idea of “green” hydrogen.

For a detailed deep dive into hydrogen and how it is obtained in a sustainable manner, be sure to check out the extensive information provided by H2 Green Steel on its website. When an abundant supply of green hydrogen is available, the company plans to use it to decarbonize other industries with a high carbon dioxide impact, such as cement.

Enthusiastic Customers

Most of the customers pioneering the green transition with H2 Green Steel have signed up for Science Based Targets covering not only Scope 1 and 2 but also Scope 3 emissions. This accelerates their determination to change. These companies want to drastically reduce the carbon footprint within of their products because they realize this is what their customers are demanding today and in the future.

“Customers are putting significant value in the CO2 reductions achieved in the high quality hot rolled, cold rolled, and galvanized steel we will deliver to them. It’s amazing to see how fast the sentiment in the market has changed since our introduction a year ago. The demand for green steel by far exceeds what I had expected, and the interest is coming from a broad range of industries. We are already converting this volume into binding long form agreements with our customers,” says Mark Bula, Chief Commercial Officer, H2 Green Steel.

The sectors recognized as frontrunners driving this change include steel service centers, pipe and tube, passenger vehicles and heavy commercial vehicles, as well as white goods and construction products. The companies that have signed contacts with H2 Green Steel include Adient, BE Group, Bilstein Group, BMW Group, Electrolux, Kingspan, Klöckner & Co, Lindab, Marcegaglia, Mercedes-Benz, Miele, Mubea, Purmo Group, Roba Metals, Scania, Schaeffler, Zekelman Industries, and ZF Group.

The Takeaway

Notice that the low carbon steel will be more expensive than steel made the traditional way. That’s because the cockamamie economic system we call capitalism allows manufacturers to pollute to their heart’s content without any financial penalty. How can that be? Because they buy the politicians who make the rules, so the rules always favor them. As George Carlin said, “It’s a big club — and you’re not in it!

Obviously, the economic system needs to be revised to make polluters pay. Hopefully, that message gets heard and acted on before the Earth becomes uninhabitable for humans. A system that privatizes profits but socializes costs is unsustainable, both literally and figuratively.

 

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Written By

Steve writes about the interface between technology and sustainability from his homes in Florida and Connecticut or anywhere else the Singularity may lead him. You can follow him on Twitter but not on any social media platforms run by evil overlords like Facebook.

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