Green iron is a prize worth billions, winning is the trick

(Source – The Hindu, International Edition – Page No. – 13)

Steel Industry and Carbon Emissions

• The steel industry contributes 7% to 9% of global carbon emissions, making it the largest industrial emitter.
• The main source of emissions is converting iron ore into pig iron, which relies heavily on coal.
• Achieving net-zero emissions by 2050 requires transforming this process.

Technological Solutions and Emission Reduction

• New technologies can reduce carbon emissions to 300 kg per ton of steel, down from the current 2.2 tons per ton of steel.
• These technologies involve using green hydrogen instead of coal.
• Though steel will not be completely emissions-free, emissions can be significantly reduced.

Investment and Infrastructure Requirements

• Transitioning to green steel requires massive capital investments and cheap green energy.
• Governments must coordinate policies and incentives across resource-producing and steel-making countries.
• Hundreds of billions of dollars are needed to build the required energy and processing infrastructure.

Economic Potential of Green Iron

• Australia’s current iron ore exports are worth $85 billion, while metallurgical coal adds $34 billion.
• Converting to green iron could increase export value to $252 billion per year.
• A 40% conversion by 2050 could still generate $110 billion annually.

Commitments from Stakeholders

• Steel mills in China, Japan, and South Korea must commit to buying green iron.
• They must switch to electric arc furnaces, which do not require coal for smelting.
• Mining companies must invest in renewable energy and hydrogen production.

Role of Governments and Market Challenges

• Green steel is more expensive to produce than traditional steel.
• Governments must introduce carbon taxes or subsidies to encourage the transition.
• Consumer demand alone may not be enough to drive change.

Need for Transition

• The transition to green steel requires strong initial efforts to gain momentum.
• Collaboration among miners, steel producers, and governments is essential.
• If successful, this shift could create a more sustainable and profitable steel industry in the long run.

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