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The role of green hydrogen in sustainable steel production for India  Part-1

Table of Contents

summary

  • The Role of Green Hydrogen in Steel Production
    • Technological Integration
    • Current Initiatives and Policies
  • Economic Viability and Government Support
  • Future Outlook
  • Benefits of Green Hydrogen in the Indian Context
    • Environmental Benefits
      • Decarbonization of Steel Production
      • Improved Resource Efficiency
    • Economic Benefits
      • Investment Opportunities
      • Job Creation
    • Industrial Transformation
      • Boosting Renewable Energy Use
      • Facilitating Technological Advancements
      • Support for the Energy Transition
  • Technological Innovations
    • Green Hydrogen Production Technologies
      • Electrolysis
      • Biomass Gasification
    • Direct Reduced Iron (DRI) Production
      • Hydrogen-based Reduction
      • Electric Arc Furnaces (EAF)
  • Challenges and Economic Viability
  • Future Prospects
  • Government Policies and Initiatives
    • Decarbonization Initiatives
    • Green Hydrogen Mission
    • Financial Incentives and Support
    • International Collaborations
    • Challenges and Future Directions
  • Challenges and Barriers
    • Economic and Technological Hurdles
    • Infrastructure Limitations
    • Policy and Regulatory Frameworks
    • Feedstock and Resource Constraints

Summary

Green hydrogen is increasingly recognized as a transformative force in sustainable steel production, particularly in India, which ranks as one of the largest steel pro- ducers globally. The integration of green hydrogen into steelmaking processes is pivotal for reducing the sector’s significant carbon emissions, as the steel industry accounts for approximately 8% of global carbon dioxide emissions[1][2]. By replacing traditional fossil fuels with green hydrogen, India aims to significantly lower its carbon footprint while addressing the urgent need for decarbonization in line with its climate commitments.

The Indian government has launched several initiatives, including the National Green Hydrogen Mission, which seeks to facilitate the development of a robust green hydro- gen economy by 2030. This mission aims to attract substantial investments, enhance job creation, and position India as a leader in green hydrogen technologies[3][4].

Noteworthy technologies such as hydrogen Direct Reduced Iron (H-DRI) and carbon capture utilization and storage (CCUS) are gaining traction as promising solutions that can revolutionize the steelmaking process by cutting emissions by nearly 50 million metric tons of CO2 by 2030[5][6].

Despite the potential benefits, the transition to green hydrogen-based steel produc- tion in India faces significant challenges, including high initial costs, infrastructure limitations, and the need for supportive policy frameworks[7][8]. The high costs associated with hydrogen production and the lack of adequate infrastructure present substantial economic hurdles that must be addressed to facilitate the widespread adoption of these technologies. Furthermore, limited regulatory frameworks hinder investment in green hydrogen initiatives, making robust government support essen- tial for overcoming these barriers.

Looking ahead, the successful implementation of green hydrogen technologies in the steel sector could set a precedent for sustainability in other industrial fields, position- ing India at the forefront of global clean energy initiatives. As the nation pursues a greener economy and seeks self-reliance in energy, the role of green hydrogen in steel production is anticipated to be crucial in driving significant environmental and economic benefits[9][10].

The Role of Green Hydrogen in Steel Production

Green hydrogen is emerging as a pivotal element in the quest for sustainable steel production, particularly in India, which is one of the largest steel producers in the world. The integration of green hydrogen into steelmaking processes presents a sig- nificant opportunity for decarbonization, helping to mitigate the industry’s substantial carbon footprint, which is estimated to be responsible for about 90% of global carbon dioxide emissions in the metals and mining sector[1][2].

Technological Integration

The main technologies attracting investments for the production of green steel include hydrogen Direct Reduced Iron (H-DRI) and carbon capture utilization and storage (CCUS) systems[3]. Green hydrogen can be utilized at various stages of the steel production process, replacing traditional fossil fuels and contributing to a more sustainable manufacturing cycle[4]. Notably, hydrogen-DRI processes are ca- pable of producing steel with significantly lower emissions compared to conventional methods[5].

Despite the promise of green hydrogen, several challenges remain, including the availability of feedstock, the high initial costs of technology and infrastructure, and the need for supportive policy frameworks[6][7]. Technological advancements and inno- vative solutions are essential to overcome these barriers and make hydrogen-based steel production economically viable.

Current Initiatives and Policies

The Indian steel industry has taken proactive measures to integrate state-of-the-art clean technologies aimed at improving energy efficiency and reducing greenhouse gas emissions. Notable Best Available Technologies (BAT) employed in the sector include Coke Dry Quenching (CDQ) and Top Pressure Recovery Turbines (TRT)

in blast furnaces, which enhance energy recovery and efficiency[4]. Additionally,

pilot projects under the National Green Hydrogen Mission (NGHM) aim to validate the feasibility of hydrogen-based processes for steel production, focusing on the technical and economic viability of these initiatives[8][9].

Economic Viability and Government Support

The high initial costs associated with implementing green hydrogen technologies necessitate government incentives, including production-linked schemes, tax breaks, and public-private partnerships[7]. These strategic investments are critical for scal- ing up low-carbon steel production methods and fostering a transition towards a greener steel industry. Moreover, carbon pricing mechanisms are expected to make high-emission production methods less competitive, further incentivizing the adop- tion of sustainable practices[10].

Future Outlook

As the Indian government pursues its goal of self-reliance in energy and leadership in green hydrogen technology, the integration of hydrogen into the steel sector is viewed as a crucial step. This not only aims to reduce reliance on fossil fuel imports but also seeks to inspire global clean energy initiatives and reduce carbon emissions[9][11]. The successful implementation of hydrogen-based steelmaking technologies could set a precedent for sustainable practices in other industrial sectors, ultimately con- tributing to a greener economy and environmental sustainability.

Benefits of Green Hydrogen in the Indian Context

Green hydrogen has the potential to significantly transform the steel industry in India, which is one of the largest producers of steel globally. Its implementation can lead to various environmental, economic, and industrial benefits.

Environmental Benefits

Decarbonization of Steel Production

The steel industry is responsible for a significant share of industrial CO2 emissions, contributing substantially to global warming and climate change.[12] By integrating green hydrogen into the production processes, India can significantly reduce these emissions. For instance, utilizing green hydrogen in direct reduced iron (DRI) pro- duction can lead to a reduction of nearly 50 million metric tons of CO2 emissions by 2030.[13][12] This is particularly crucial for India as it strives to meet its commitment to reduce the emission intensity of its GDP by 33-35% by 2030 compared to 2005 levels.[14]

Improved Resource Efficiency

The adoption of green hydrogen technology can also enhance resource efficiency in the steel sector. Traditional steel production processes are heavily reliant on coal,

leading to resource depletion and substantial waste generation.[15][16] Transitioning to green hydrogen can mitigate these issues by reducing dependency on coal and decreasing water usage associated with conventional methods.[15]

Economic Benefits

Investment Opportunities

The National Green Hydrogen Mission, launched in January 2023, aims to create a robust green hydrogen economy in India, with expectations of attracting over ¹8 lakh crore in investments by 2030.[13] This initiative not only promises to bolster the economy but also opens up avenues for new business models and market opportunities in the green hydrogen supply chain, from production to storage and distribution.

Job Creation

With the anticipated growth of the green hydrogen sector, over 600,000 jobs are expected to be created by 2030 as new industries emerge and existing ones adapt to greener technologies.[13] This job creation is vital for India’s economic development, particularly in regions reliant on traditional steel manufacturing.

Industrial Transformation

Boosting Renewable Energy Use

Green hydrogen production necessitates a significant increase in renewable energy capacity. The mission estimates an addition of approximately 125 GW in renewable energy capacity to support green hydrogen production.[13] This shift not only aids in decarbonizing the steel industry but also strengthens India’s overall energy security by reducing reliance on imported fossil fuels.[13]

Facilitating Technological Advancements

The transition to green hydrogen can spur advancements in cutting-edge technolo- gies within the steel sector. Investments in the development of electrolyzers and other hydrogen-related technologies are expected to enhance domestic manufacturing capabilities, thereby fostering innovation and sustainability within the industry.[17]

Support for the Energy Transition

While green hydrogen offers long-term benefits, it also presents a viable transitional strategy. Until green hydrogen becomes economically viable on a larger scale, natural gas is positioned as a critical transition fuel. The steel industry plans to ramp up

its consumption of natural gas from 1 billion cubic meters annually to 10 billion cubic meters by 2030, facilitating a smoother transition towards a hydrogen-based economy.[7]

Technological Innovations

The integration of green hydrogen into sustainable steel production is facilitated by various technological innovations that aim to enhance energy efficiency and reduce carbon emissions.

Green Hydrogen Production Technologies

Electrolysis and Biomass Gasification

Green hydrogen, a crucial component for sustainable steelmaking, is primarily pro- duced through the electrolysis of water using renewable energy sources, such as solar, wind, and hydroelectric power[18][14]. This process splits water into hydrogen and oxygen, yielding a clean energy carrier that can significantly reduce the carbon footprint of steel production[19]. In addition to electrolysis, biomass gasification combined with carbon capture technologies is emerging as another viable method for hydrogen production in India[20][4].

Direct Reduced Iron (DRI) Production

Hydrogen-based Reduction

One of the most promising advancements in steelmaking technology is the hydro- gen-based direct reduction of iron (H-DRI). This process utilizes hydrogen gas to convert iron ore into iron, thereby eliminating the CO2 emissions typically associated with traditional blast furnace methods[21][22]. Pilot projects funded by the Indian gov- ernment are underway to develop this technology further, with notable investments aimed at producing DRI using 100% hydrogen in vertical shaft furnaces[23].

Electric Arc Furnaces (EAF)

Electric Arc Furnaces (EAF) represent another innovative approach to sustainable steel production. EAF technology allows for the use of scrap steel, reducing the demand for virgin iron and thereby lowering overall emissions[24][25]. The increased adoption of scrap collection initiatives and policies promoting end-of-life vehicle recycling in India support the growth of EAF technology[26][25].

Challenges and Economic Viability

While these technologies offer substantial promise, challenges remain in scaling up production. The high costs associated with hydrogen production, particularly from renewable sources, pose significant economic barriers[27][28][29]. Moreover,

substantial infrastructure investments and a robust policy framework are essential to enable widespread adoption of these green technologies in the steel sector[4]. The National Green Hydrogen Mission aims to address these challenges by attracting

investments and facilitating the development of indigenous manufacturing capabili- ties[30][31].

Future Prospects

As India seeks to position itself as a global hub for green hydrogen production and its derivatives, the focus on innovative technologies will be critical. By 2030, the anticipated production capacity for green hydrogen in India is expected to reach at least 5 million metric tons per annum, coupled with the addition of approximately 125 GW in renewable energy capacity[31]. The successful implementation of pilot projects and the advancement of green hydrogen technologies are expected to play a pivotal role in decarbonizing the steel industry, reducing approximately 50 million metric tons of CO2 emissions by 2030[32][31].

Through continued technological innovation and government support, India is poised to make significant strides toward sustainable steel production, thereby contributing to global efforts in mitigating climate change.

Government Policies and Initiatives

The Indian government has been actively implementing various policies and initia- tives to promote sustainable steel production, particularly through the adoption of green hydrogen technologies. These measures aim to decarbonize the steel sector, ensuring a transition towards more environmentally friendly practices.

Decarbonization Initiatives

One significant step taken by the government is the introduction of the Steel Scrap Recycling Policy in 2019, which is part of a broader effort to reduce carbon emis- sions from the steel industry[33]. This policy encourages the use of recycled steel and aims to enhance resource efficiency, thereby promoting sustainability in steel manufacturing.

Green Hydrogen Mission

A major milestone in this transition is the launch of the National Green Hydrogen Mission on January 4, 2023. The mission has an outlay of ¹19,744 crores up to FY 2029-30 and is designed to facilitate India’s goal of achieving self-reliance through clean energy solutions. It seeks to significantly decarbonize the economy, reduce reliance on fossil fuel imports, and position India as a global leader in green hydrogen technologies[6][34]. The mission will support the creation of demand, production, and utilization of green hydrogen, along with the establishment of Green Hydrogen Hubs[2].

Financial Incentives and Support

To encourage the adoption of green hydrogen in steel production, the government has proposed various financial incentive mechanisms. This includes the Produc- tion-Linked Incentive (PLI) Scheme, particularly targeted at the manufacturing of ‘Specialty Steel’. Under this initiative, companies have committed to substantial investments, leading to significant job creation and an increase in domestic steel production capacity[35][36].

Additionally, the government is working on establishing pilot projects that explore different production pathways for green hydrogen, which will ultimately facilitate its integration into the steel production process[2][35].

International Collaborations

The Indian government is also collaborating with international partners to enhance its green steel initiatives. Through the Ministry of Economy, Trade & Industry in Japan, funds are being allocated under the Green Aid Plan for various energy-efficient projects within the steel sector. These projects include significant advancements in waste heat recovery and management systems at leading steel companies like Tata Steel and Rastriya Ispat Nigam Limited (RINL)[37][38].

Challenges and Future Directions

Despite these proactive initiatives, the transition to green hydrogen-based steel- making faces several challenges, including high initial infrastructure costs and tech- nological barriers. Nevertheless, with robust governmental support and financial backing, India is set to make significant strides in decarbonizing its steel sector and establishing a sustainable production framework[32].

Challenges and Barriers

The adoption of green hydrogen in sustainable steel production in India faces several significant challenges and barriers that hinder its widespread implementation.

Economic and Technological Hurdles

One of the primary obstacles is the high cost associated with hydrogen production and its economic viability. Currently, the cost of green hydrogen remains elevated compared to traditional fossil fuels, primarily due to the expensive electrolysis pro- cess necessary for its production.[28][39] Although projections suggest that the cost of green hydrogen could drop to around US$1/kg by 2030, making it a more viable option for large-scale steel production, the current economic landscape poses substantial challenges for investment in this transition.[40]

Infrastructure Limitations

Infrastructure is another critical barrier to the effective deployment of green hy- drogen. The production, transportation, and utilization of hydrogen require robust

infrastructure, which is currently lacking in many regions of India. Issues such as land availability, water scarcity, and inadequate connections to existing pipelines further exacerbate the situation.[41][42] Without significant investments to develop the necessary infrastructure, scaling up hydrogen production to meet industrial demand remains a daunting challenge.[32]

Policy and Regulatory Frameworks

Limited policy and regulatory frameworks also pose hurdles for the growth of green hydrogen initiatives. While there have been government-driven efforts, such as the National Hydrogen Mission aimed at promoting R&D and demonstrating pilot plants, the regulatory landscape still requires significant strengthening to foster investment and development in this sector.[43][44][45] Strong governmental support is crucial for facilitating financial backing and ensuring the viability of green hydrogen projects.

Feedstock and Resource Constraints

Moreover, the availability of feedstock and the competition for resources present additional challenges. The reliance on renewable energy sources for electrolysis places pressure on existing energy infrastructures and requires a significant expan- sion of renewable capacity to ensure cost-competitive hydrogen production.[29] This necessity for large-scale renewable energy generation creates a complex interplay between the energy sector and the steel industry, requiring coordinated policy and investment strategies.

Future Outlook

Despite these barriers, ongoing technological advancements and supportive policy frameworks offer a glimmer of hope for the future of green hydrogen in India’s steel production. Efforts by domestic steel conglomerates, such as Tata Steel and JSW, to collaborate with global technology firms demonstrate a commitment to overcoming these challenges and transitioning to greener production methods.[6][46] However, it is imperative to address the existing economic, infrastructural, and regulatory challenges to fully realize the potential of green hydrogen in achieving sustainable steel production in India.

Case Studies and Examples

Pilot Projects for Green Hydrogen in Steel Production

In recent years, India has witnessed a growing interest in green hydrogen as a sustainable alternative for steel production. Several pilot projects have been initiated to explore the potential of green hydrogen-based steelmaking. Notable examples include projects undertaken by Matrix Gas and Renewables in Raipur, JSW Steel at its Vijayanagar plant, and Jindal Steel & Power Limited at its Angul facility[47][48].

These initiatives are pivotal as they mark the first steps towards integrating renewable hydrogen into the steel manufacturing process.

Government Initiatives and Funding

The Indian government has recognized the importance of green hydrogen in achiev- ing decarbonization goals within the steel sector. To support this transition, a sig- nificant investment of INR 347 crore has been allocated to various green hydrogen projects[49]. This financial backing is expected to facilitate the commissioning of these innovative projects, promoting the adoption of sustainable practices within the industry.

International Collaboration

India’s commitment to developing green hydrogen technologies is further bolstered by international partnerships. The Government of Japan, through its Ministry of Economy, Trade and Industry, provides Overseas Development Aid (ODA) under its Green Aid Plan (GAP) for establishing energy-efficient, environmentally friendly

projects in sectors like steel. The New Energy and Industrial Technology Development Organisation (NEDO) of Japan manages these projects in collaboration with India’s Ministry of Steel[50][23].

BF Stove Waste Heat Recovery: Completed at Tata Steel. Coke Dry Quenching: Completed at Tata Steel.

Sinter Cooler Waste Heat Recovery: Completed at Rastriya Ispat Nigam Limited.

Energy Monitoring and Management System: Currently under implementation at ISP Burnpur, SAIL.

These projects exemplify how international collaboration can enhance technological advancements and sustainability in India’s steel sector[50][5].

Future Outlook and Challenges

Despite the progress made through these pilot projects, the transition to green hydrogen as the primary fuel for steelmaking in India is projected to take time. Experts anticipate that green hydrogen will not become the dominant route for steel produc- tion before 2050 due to high production costs and a lack of an established ecosystem for hydrogen production[47][51]. In the interim, India may need to rely on imported hydrogen or alternative gases while improving material and energy efficiencies and integrating renewable energy sources for decarbonizing direct reduced iron (DRI) production.

References

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