The world steel industry consumes about 8% of global primary energy and contributes, if that’s the word, about 7% of total CO2e. That’s a big industrial emissions problem, and it’s not going to go away because we stop using steel. But there’s a bunch of good news about steel.
For a bit of background, I’ve been digging into major climate change problems and assessing solutions for quite a while now. I dealt with the big hitters that turned out to have easy solutions first, of course.
Electricity? Wind and solar will be doing the vast majority of the heavy lifting. Hydro, geothermal, and a tiny bit of tidal will round out the mix. A bunch of HVDC and a quite reasonable amount of grid storage, mostly closed loop, off river pumped hydro will take care of the rest.
Ground transportation? 100% electrified, or close enough that it doesn’t matter. Lots of tiny personal electric vehicles buzzing around our increasingly urban lives. Transit. Virtual work. Electric cars for people who really need their space and love commuting. Electric trucks of all scales and range. Yes, really. And fully electrified rail, as every continent is already well on the way to achieving, with North America as an unruly and ‘exceptional’ outlier.
But then there are the harder targets. I’ve been digging through those for the past few years.
Agriculture? Well, agrigenetics of nitrogen-fixing microbes and plants to maximize letting nature do the heavy lifting instead of turning fossil fuels into ammonia is a start. It reduces the problem of the ammonia turning into high-GWP nitrous oxide too. Precision agriculture using much smaller amounts of fertilizers and the like exactly where needed, including by heavy-lift drone, avoiding soil compaction, does a bunch more. Getting subsistence farmers off of the land and turning much more to highly automated farming is big. Green ammonia for much lower remaining fertilizer requirements. And low tillage agriculture to keep carbon in the soil. That set of assessments took a while, and there’s a lot more to learn there, but still, the pathway is clear.
Aviation? Increasing ranges for battery-electric, a period of battery hybrid for divert and circling, SAF biofuels for the longer hauls, and eventually battery-electric for everything. Plummeting CO2e biofuels, of course, as agriculture and biofuel processes electrify and decarbonize.
Marine shipping? Battery-electric for all inland shipping, two-thirds of short sea shipping, and biodiesel for the rest. Same engines, same bunkering in ports, slightly better energy density, cleaner burning, and mostly will be burnt a long way from people regardless.
Cement? We have lots of solutions, they just cost more. And we have mass timber and more building reuse to allow us to avoid a lot of cement use.
Residential and commercial buildings? Heat pumps delivering three units of heat energy for every unit of electricity, with the electricity being greener and greener every year. Shifting to mass timber and low carbon cement to reduce embodied carbon.
Industrial heat? Heat pumps again for the 45% of heat under 200° Celsius for massive energy savings. And several mostly electric other solutions including insulation, resistance, induction, electromagnetic, electric plasma and thermal storage for the higher temperatures, typically with significant efficiency wins so lower energy requirements.
But there’s been a big hitter outstanding. What about steel?
That 7% of CO2e is a big wedge, one I’ve only been formulating a thesis about, but not doing a deep dive into. People who read my stuff will know that one of the key things I try to do is project problem areas into the future, decade by decade through 2100. And so I’m starting to do that, finally. It’s been on my to do list for a couple of years, but a recent communication with a metals engineer with a multi-country career in steel, Briana Binnie, triggered me to finally start digging in.
Being in steel, Binnie understands pipeline steel demand very well. She stumbled across my assessment of pipelines vs HVDC and reached out. I shared my thesis about global steel decarbonization, including my awareness that I hadn’t yet done sufficient research to keep error bars inside the scale of the graph if I wanted to project the problem and solution set through 2100.
What is that thesis?
With peak oil demand arriving between 2025 and 2030 and peak natural gas around 2035, lots more scrap steel will become available, including the 3 million miles of US pipeline, and 40% of deepwater ships that carry bulk coal, oil, and gas. The US already gets 70% of its steel from scrap via electric steel minimills, and that will spread globally to a much greater extent.
The 15% of bulk deep water shipping that is raw iron ore will diminish a lot due to that and higher shipping fuel costs leading to more local processing. Lots more reduction with direct electricity or hydrogen locally to where the ore is mined, HBI or steel ingots containerized instead.
With foreign steel shipping prices going up and alloy availability changing, more materials substitution.
With China having mostly completed its massive infrastructure build out, local scrapping, and electric steel minimills, reduced global demand balanced by Belt and Road Initiative demand elsewhere. Reduced demand from the fossil fuel industry as it winds down.
Peak population between 2070 and 2100, hence flattening demand pressures there, countered by increasing global affluence.
That nets out to significantly reduced new steel requirements with the majority of steel demand met by electric steel minimills fed by scrap steel and renewable electricity.
Binnie provided some excellent observations. One is that the global automobile and light vehicle industry is a major, consistent, and growing demand segment, while the fossil fuel industry is spiky around booms. Another is that electric arc furnace (EAF) minimills that eat scrap steel have some challenges with the ~25% of new steel they need to enable lots of high quality alloys, in that direct reduction of iron results in rounded pellets that are a bit more expensive to use due to thermal properties. Interesting stuff to dig into.
And so, I’ve been digging into it. There are some interesting results. One is that it’s trivial to find global steel production and consumption statistics by country and method of production, but that it’s difficult to find steel demand by economic segment. Want to know what Indonesia’s steel manufacturing and domestic consumption was in 1978? Easy. Want to know how much steel the global automobile industry or the oil and gas industry bought last year? Hard.
But as teased in the title, there’s a data point worth calling out, the steel available for scrap in just US pipelines. With peak oil demand coming this decade and peak natural gas next decade, over the next 40 years most of the world’s pipelines will be turning into easily accessible, easily mined scrap steel running along the surface, waiting to be scooped up, cut up, and shoved into electric steel minimills.
How much steel is that? Well, the average pipeline has about 50 pounds or 23 kg of steel per foot per one analysis, which is good enough for napkin math. The US has about 3 million miles of pipelines per the recent US transportation blueprint which I assessed recently (tl’dr: good intentions, weak levers, some clear misses).
That turns into about 350 million tons of steel, most of which is going to be ripped up and turned into new steel for more productive and less harmful end uses in the coming decades. How much is that in comparable terms?
Well, the US is consuming about 86 million tons of steel every year these days, putting it in fourth place behind China, India, and Japan. Oh, another interesting data point. China is making and consuming about 10 times as much steel as India, the runner-up, and more than the rest of the world combined. It’s the much more productive inverse of US military spending.
I’ll be coming back to that point in a future piece is in this series on steel, but for now, let’s stick with pipelines and the US. Those 350 million tons of to-be-scrapped steel are four years of total demand for steel in the country.
That’s indicative of the scale of the fossil fuel infrastructure globally waiting to be melted down and turned into wind turbines and solar panel mountings, into electric cars and bikes, into HVDC transmission towers and battery housings. We’ve mined enormous amounts of iron and coal in order to build infrastructure to extract, process, refine, and distribute fossil fuels, and we’re going to have lots of scrap steel to work with.
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