Despite the environmental benefits, economic feasibility and iron ore quality are the main obstacles to the widespread global adoption of DRI technology. Roberto Pancaldi, CEO of Tenova, a company specializing in innovative solutions for the steel and mining industries, told GreenSteelWorld in an interview.
As for the economic aspect, Tenova’s CEO explained that currently, 1.4 billion tons of steel are produced annually under the blast furnace-box converter (BF-BOF) scheme.
“To replace these capacities, you will need 600-700 new DRI plants plus EAFs, which is a massive task,” he said.
In addition, Roberto Pancaldi reminded, many existing blast furnaces, especially in China, are relatively new. Much of the steelmaking capacity was commissioned in the last 20 years. With a standard blast furnace lifespan of 40 years, it is too early to justify the economic feasibility of replacing them.
Another major limitation, according to Tenova’s CEO, is the quality of iron ore. DRI-EAF technology requires high-quality raw materials with an iron content of 66-67%. DRI plants can operate regardless of ore quality. However, when lower-quality raw materials are used, a significant amount of slag is generated when the DRI is loaded into the electric furnace, which leads to a loss of EAF efficiency.
“High-quality pellets are already in short supply, and with the current trends in DRI investment, we predict a shortage of these materials in the next five to ten years,” emphasized Roberto Pancaldi.
As for EAF technology, which is positioned as one of the components of the emission reduction solution, two significant problems remain: the availability of scrap and its quality. According to Tenova’s CEO, firstly, there is simply not enough scrap to produce the 2 billion tons of steel that the market needs annually. Secondly, while steel can be recycled endlessly, some alloying elements, such as copper, also melt during the recycling process.
“This makes it difficult to remove copper from molten steel. As a result, each time the steel is recycled, the percentage of copper increases, which can negatively affect the properties of more complex steels,” Roberto Pancaldi explained.
As GMK Center reported earlier, Tenova will supply a 30-meter direct reduction iron (DRI) tower and electric arc furnace (EAF) for RINA’s Hydra project in Italy.
The €88 million initiative is funded by the European instrument NextGenerationEU and supported by the Italian Ministry of Enterprise and Production. It aims to stimulate steel production using 100% hydrogen fuel. The project’s goal is to enable all European steel producers to test this method and formulate future investment plans for the green transition.
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