Steel is one of the world’s most energy-intensive industries, contributing up to 11% of global CO2 emissions. The ubiquitous material is present in nearly every building, and construction represents more than half of global steel demand. When we think of steel in buildings, we tend to conjure framing; however, most steel is used for elements other than the primary structure. According to the World Steel Association, reinforcing bars account for 44% of steel in buildings, followed by sheet products at 31%, and structural sections at 25%. Because steel is pervasive, has such a significant emissions impact, and continues to grow in demand—global crude steel production saw an increase of 11.6% last year—any serious effort to decarbonize buildings must include measurable progress to reduce steel’s carbon footprint.
Thankfully, such efforts are underway. According to a 2020 McKinsey study, four factors are driving improvements in steel’s environmental performance: the 2015 Paris Agreement, tightened carbon emission regulations, increased investor demand, and growing market support for climate-friendly steel products. Based on an analysis of 20 global steel producers, the report estimates that approximately 14% of the global steel industry’s potential value is tied to the ability to reduce its environmental impact. This value ranges between 2% and 30% for individual steel producers, making it unsurprising that the steel industry is taking decarbonization seriously, for both economic and environmental reasons.
Most steel manufacturers employ blast furnace (BF) technology to convert iron ore, coke, and limestone into crude iron and carbon dioxide. The iron is further processed in a basic oxygen furnace (BOF), producing low-carbon steel with an additional release of CO2. The energy-intensive nature of BF-BOF steelmaking leads to high carbon emissions, on the order of 1.73 tons of CO2 per ton of resulting steel. Although attaining net-zero carbon with the BF-BOF process is challenging, incremental improvements are possible. One approach involves altering the blast furnace mixture by reducing the amount of coal used to make coke and increasing the amount of iron ore. Another method deploys gas from coke ovens to offset some of the primary energy for the blast furnace. According to Resources, the most effective way to reduce CO2 emissions in BF-BOF steelmaking is to employ a carbon capture, utilization, and storage process. For example, Tata Steel in the Netherlands is developing a way to sequester the CO2 emitted from steel production in depleted natural gas fields under the North Sea. The company predicts that this method will reduce 40% of its carbon emissions by 2030.
Another methodology gaining traction is the direct reduction of iron (DRI) approach, which involves processing in an electric arc furnace (EAF), a tool used in two-thirds of U.S. steel production but less than a quarter of global production. The DRI-EAF method is less carbon-intensive than its BF-BOF counterpart. Used to transform scrap material into new products, DRI-EAF steel-making fueled by natural gas results in about half the emissions of BF-BOF manufacturing powered by coal. Manufacturer ArcelorMittal operates a DRI-EAF production facility in Hamburg, Germany—the only such plant in Europe according to Steel Times International—and is planning another facility in Eisenhüttenstadt. The new plant will employ “green” hydrogen, or hydrogen produced via water electrolysis using renewable energy, as a fuel source. According to the company, the technology will enable it to lower its European emissions by 30% by 2030.
The Sweden-based steel manufacturer SSAB is already producing commercially available steel this way. Utilizing green hydrogen instead of coal and coke, the company has created “the world’s first fossil-free steel.” The achievement, called HYBRIT, is the result of a five-year partnership between SSAB and energy company Vattenfall, and represents an endeavor to improve the environmental performance of steel-making. SSAB produced its first batch of HYBRIT steel in July and delivered it to the Volvo Group. Although the SSAB’s production facility in Oxelösund has yet to be converted to EAF technology—that advancement is slated for 2025—the use of a renewable, fossil-free energy source represents a compelling means to accelerate green steel production. SSAB aims to scale HYBRIT in 5 years, ultimately reducing Sweden’s CO2 emissions by 10%. According to Anna Borg, president and CEO of Vattenfall, “Electrification is contributing to making fossil-free living possible within one generation.”
According to Faustine Delasalle, director of the Energy Transitions Commission for the World Economic Forum, “a revolution in steel production is now in reach.” Although steel produced via low-emissions processes is 20% to 50% more expensive than steel made via conventional approaches, the Net-Zero Steel Initiative offers a comprehensive road map for economic viability. With critical stakeholders identifying resource efficiency at every stage of material production, the NZSI estimates that green steel will result in a negligible price increase (around 1%) over conventional steel. Leading financiers like ING, Citi, and Goldman Sachs are investing heavily in steel decarbonization, and NZSI supporters will advocate for government support and policy interventions at COP26 in Glasgow. Although significant work remains to make green steel widely available, the prospect of a common building material with net-zero embodied energy—something difficult to imagine until recently—is captivating.
The views and conclusions from this author are not necessarily those of ARCHITECT magazine or of The American Institute of Architects.
