While demand for steel continues to soar, progress on efficiency and clean production methods has slowed notably.
According to Create Digital, steel production is now the most carbon-intensive industry in the world, making up around 11 percent of global carbon emissions. With demand higher than ever, finding a way to decarbonise steel production is an essential part of transitioning to sustainability. And Australia needs to be at the forefront of this move.
The problem with steel
More than one-third of the world’s iron ore is mined in Australia, an essential part of steel production. Converting Australia’s iron ore into steel results in the emission of 1.5 billion tonnes of CO2 every year, which is triple the country’s domestic emissions. Australia is also the largest exporter of metallurgical coal, another vital part of the steelmaking process.
Create Digital reveals that each tonne of steel requires around 1.6 tonnes of iron ore to produce, and emits around 1.9 tonnes of CO2.
Dr Stuart Walsh, a senior lecturer in resources engineering at Monash University, reveals that significant changes need to be made if this process is to become more sustainable.
“While some of the extra demand will be met through recycling, the current rates of raw iron ore production need to be maintained or increase into the future to meet increased demand for steel,” he explains.
This increased iron ore production could have major impacts on the environment if it’s not closely monitored.
However, it’s not all bad news. According to the Australian Steel Institute, steel is the world’s most recyclable material due to its ability to be used again and again without compromising the quality. The steel industry has already made some major steps towards decarbonisation, and the production of one tonne of steel now requires around 40 percent of the energy it did in 1960.
Steel is a vital part of the construction industry.
The path to sustainability
In order to continue on the path to sustainability, there are several changes that Australia can make. The International Energy Agency reveals that emissions from steel have to drop by 50 percent by 2050, and then continue to decline, in order to reach climate targets. However, this will be challenging as steel demand is anticipated to rise by around one-third over the same period.
“We’re moving into a world that needs less emissions, but more steel,” says Dr Marcus Haynes from Geoscience Australia. “Our ability to produce green steel cheaply will play a significant role in meeting global ambitions towards decarbonisation.”
A greener horizon
The steelmaking process currently involves heating iron ore and coke in a blast furnace to produce molten iron, before sending this liquid iron to a basic oxygen furnace to add carbon and turn it into steel. As the coke is heated with the iron ore, it converts into carbon monoxide, extracting the oxygen from the iron ore. The majority of emissions are released when this oxygen comes into contact with the iron ore.
As a greener alternative, direct reduction of iron (DRI) can be employed instead of a blast furnace. The DRI pelletises the iron ore and then runs synthetic gas through it, which takes the oxygen away as steam. To decarbonise DRI, producers can add carbon capture and storage technology, or use pure hydrogen instead of coal. There are several other methods of carbon reduction that can also be employed in the steel-making process, meaning working towards a greener future isn’t as hard as it first appears.
The UN Environment Programme reveals that substituting natural gas for coal in production produces around half of the carbon dioxide.
Australia’s green steel industry is in its early stages, but already they have reached several promising milestones. Western Australia alone is home to three major green steel projects, including a $400 million green steel recycling mill in Collie. Additionally, the Australian Government has pledged $18.1 million over six years for Green Metals Foundational Incentives, as part of the 2024-25 Budget.
To read more about sustainability in the steel industry, click here.