Green steel: design and cost analysis of hydrogen-based direct iron reduction

Authors

Abstract

Hydrogen-based direct reduced iron (H2-DRI) is an alternative pathway for low-carbon steel production. Yet,the lack of established process and business models defining green steel makes it difficult to understandwhat the respective H2 price has to be in order to be competitive with commercial state-of-the-art naturalgas DRI. Given the importance of establishing break-even H2 prices and CO2 emission reduction potentialsof H2-DRI, this study conducted techno-economic analyses of several design and operation scenarios forDRI systems. Results show that renewable H2 use in integrated DRI steel mills for both heating and thereduction of iron ore can reduce direct CO2 emissions by as much as 85%, but would require an H2procurement cost of $1.63 per kg H2 or less. When using H2 only for iron ore reduction, economic viabilityis reached at an H2 procurement cost of $1.70 per kg, while achieving a CO2 emission reduction of 76% atthe plant site. System design optimization strategies around excess H2 ratios in the DRI top gas and the H2recycle pressurization can further improve performance and economics. Low H2 excess ratios areparticularly attractive as they reduce pre-heating energy requirements and offer integration opportunitieswith static recycle ejectors if H2 is supplied at sufficiently high pressure. The potential of utilizing the electricarc furnace off-gas is shown to be much more synergistic with H2-DRI than natural gas-DRI and canincrease the break-even H2 procurement cost by up to 7b per kg H2. Such findings are critical for settingtechnical performance criteria for H2 supply and storage in the iron and steel sector.