European steel industry needs 5 million tons of hydrogen per year for decarbonization

Europe’s steel industry needs 5 million tons of hydrogen per year to decarbonize its operations, said Axel Eggert, CEO of the European Steel Association (EUROFER), at a specialized conference in Poland, Kallanish reports.

He noted that major steel projects in the region will be ready to use hydrogen by 2026-2027, but there is no supply. Conventionally produced hydrogen is available at €10-11/kg, but for the industry to be competitive, it should cost €2-3/kg.

Conference participants concluded that Europe will likely need 20-25 years to secure sufficient hydrogen supplies to decarbonize its steel industry.

Axel Eggert added that carbon capture and storage (CCUS) is crucial for the development of Europe’s steel industry. By 2034, when the EU’s free carbon emission allowances expire, there will not be enough renewable energy to meet the existing demand. This means that CCUS will be needed to continue coal-based steel production for some time.

According to Tomasz Slezak, CEO of Poland’s Weglokoks, coking coal will be needed until alternative technology is fully realized, which will take a long time in the EU. He noted that Poland has coal mines, skilled labor and know-how, which gives it room to maneuver. However, coking coal is perceived negatively despite being on the EU’s list of critical raw materials.

As GMK Center reported earlier, Germany’s government coalition has agreed on a financing mechanism for the country’s future hydrogen network, extending its construction period to 2037 and providing investor protection in the event of bankruptcy. The main hydrogen network will stretch for more than 9.7 thousand kilometers and will cost about €20 billion, 60% of which will be made up of existing gas pipelines.