Vision of the green industry

HYBRIT – Towards fossil-free steel

The steel industry is one of the highest CO2-emitting industries, accounting for 7% of CO2 emissions globally. A growing global population and an expanding urbanization are expected to trigger a rise in global steel demand by 2050. The carbon footprint in the steel industry is thus a challenge for both Europe and the world.

This is why, in 2016, SSAB (the largest steel producer in the Nordics), LKAB (Europe's largest iron ore producer) and Vattenfall (one of Europe's largest electricity producers) joined forces to create HYBRIT - a joint-venture project that endeavours to revolutionize steel-making. HYBRIT aims to replace coking coal, traditionally needed for ore-based steel making, with hydrogen. The result will be unique: The world's first fossil-free steel-making technology, with virtually no carbon footprint.

Sweden has unique conditions for this kind of project, with good access to fossil-free electricity, Europe's highest-quality iron ore and a specialized, innovative steel industry. This spring HYBRIT also starts investigating the possibilities of broadening the project to include Finland.

A pre-feasibility study, conducted 2016-2017, gives green light to the next phase of HYBRIT. This means that the spring 2018 will be spent planning and designing the construction of a globally-unique pilot plant for fossil-free steel production in Luleå; and in the Norrbotten iron ore fields, 250 km north west of Luleå

The cost for planning and designing the pilot plants is estimated to be SEK 20 million and it was recently confirmed that the Swedish Energy Agency will finance half of this, while the other half will be covered by SSAB, LKAB and Vattenfall. The Swedish Energy Agency has earlier contributed SEK 60 million to the pre-feasibility study and a four-year-long research project.

The ground is planned to be broken already before summer 2018. The pilot phase is planned to last until 2024, after which it will move into a demonstration phase in 2025-2035. The conclusion is that fossil-free steel, given today's price of electricity, coal and carbon dioxide emissions, would be 20-30% more expensive. With declining prices in electricity from fossil-free sources and increasing costs for CO2 emissions through the European Union Emissions Trading System (ETS), the pre-feasibility study considers that fossil-free steel will in future be able to compete in the market with traditional steel.

Already before a solution for fossil-free steel making is in place, SSAB aims to cut its joint carbon dioxide emissions in Sweden by 25% by as early as 2025, through conversion of blast furnace in Oxelösund, Sweden. Between 2030-2040, the aim is convert also the blast furnaces in Luleå, Sweden and Raahe, Finland to eliminate most of the remaining CO2 emissions and to attain the target of being fossil-free by 2045.

To be able to carry out this project, however, significant national contributions are still required from the state, research institutions and universities. There has to be good access to fossil-free electricity, improved infrastructure and rapid expansion of high voltage networks, research initiatives, faster permit processes and the government's active support for pilot and demonstration facilities and long term support at EU level.