US has allocated $6 billion to support projects to reduce industrial emissions

$1 billion is earmarked for the production of environmentally friendly steel in two states

The US Department of Energy has announced $6 billion in federal funding to subsidize 33 industrial projects in 20 states to reduce carbon emissions. This is stated in the report of the department.

These are initiatives in sectors that are difficult to decarbonize, including steel industry.

The department emphasized that the allocation of these funds will support high-paying jobs and increase the competitiveness of the United States. This initiative is the largest investment in industrial decarbonization in the history of the United States, and will attract a total of $20 billion, including a share of company costs. The announced projects are expected to reduce carbon emissions by 14 million tons annually.

The program includes a $500 million grant to SSAB AB for a zero-emission hydrogen-fueled steel project. It involves the construction of the world’s first commercial-scale plant using HYBRIT technology (fossil-free direct reduction of iron (DRI) technology with 100 percent hydrogen) in Perry County, Mississippi. SSAB has signed a letter of intent with Hy Stor Energy to supply green hydrogen and renewable electricity to the facility. The project also includes plans to expand SSAB’s steel production facility in Montpelier, Iowa, to utilize the DRI.

According to Hilary Lewis, Director of Steel Production at Industrious Labs, in a press release obtained by GMK Center, the first green steel plant in the US with the support of the Department of Energy is an important step towards the revival of American manufacturing.

«Thanks to this investment, the Biden administration has won the first victory in the global transition to green steel,» she said.

In addition, steelmaker Cleveland-Cliffs will receive a grant of up to $500 million to install equipment that will allow it to produce steel using hydrogen and two electric arc furnaces at its Middletown Works plant in Ohio. The company received an additional $75 million to electrify the production of specialized steel for the energy sector at Butler Works.

These projects are an important step toward meeting the growing demand for low-emission steel, which is expected to reach 6.7 million tons by 2030 in the United States alone, Industrious Labs said. In addition, it is noted that there are only 10 other announced green steel plants in the world, and they are all located in Europe. Six of them are waiting to receive government grants totaling $5.5 billion. The announcement by the Department of Energy puts the US on this map.

As GMK Center reported earlier, the US steel industry has received a boost from legislative support. The industry was supported by the CHIPS Act and laws on infrastructure and inflation reduction.