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Can Europe decarbonize heavy industry?

S.wedish steel It is said to be the toughest in the world. It may soon become the greenest. In Boden, a town near the Arctic Circle, time2 green steel (time2gs) is building a new €4 billion ($4 billion) factory. This is the first time in nearly half a century in Europe. It will be powered by green hydrogen produced on-site by the region’s abundant wind and hydropower, rather than the usual coal or natural gas. If fully built in a few years, it will employ up to 1,800 people and produce 5 million tons of steel per year.

The project is important far beyond the sparsely populated northern part of Sweden. The consequences could be significant for the continent’s producers of steel and other basic materials such as cement and chemicals. EUof gdpIt will ripple across corporate supply chains, from automakers to builders. EU It will boost Europe’s energy independence, according to the think tank Material Economics. Its importance was made clear by Russia’s energy threats against Western sanctions over the war in Ukraine. , will also benefit the climate. That said, Ann Mettler of his capital fund, Breakthrough His Energy, a Bill Gates-backed venture, believes it could mark a resurgence of heavy industry in Europe after the fossil fuel age.

Heavy industry has long appeared to be an irreparably large consumer of carbon dioxide. It takes a lot of energy to reduce iron ore to make steel, heat limestone to produce cement, and use steam to break down hydrocarbons into their constituent molecules. In addition, the chemical processes involved release even more carbon dioxide. Experts believed that reducing all these emissions would be technically infeasible or prohibitively expensive.

Both the economy and technology are finally starting to turn around. Europe is introducing tougher emissions targets, carbon prices are rising, and consumers are showing willingness to pay more for greener products. Several European countries are formulating strategies for hydrogen, the most promising alternative to fossil fuels in many industrial processes. Germany is launching a hydrogen intermediate network company (Tips.co) is a global trading hub for hydrogen and hydrogen-derived products. The most important low-carbon technologies are finally reaching maturity. It provides a “fast-forward mechanism” as many businesses need to replenish their aging assets, said Per-Anders Enkvist of Material Economics.

Taken together, these developments are enabling European manufacturers – many of whom have committed to becoming carbon neutral by 2050 – to start paying more than just talking. Material Economics has identified 70 projects across Europe that commercialize technologies that reduce carbon emissions in the basic materials industry. Hardly a week goes by without new business announcements. Adair Turner of the Energy Transition Commission, a think tank, says the decarbonization industry has gone from mission impossible to “mission possible.”

The steel industry is the most advanced. time2gsThe factory in Boden skillfully combines proven technology on a large scale. The company is building he one of the world’s largest electrolysis plants to produce hydrogen. The gas is then pumped into the reactor, where it powers a process called “direct reduction.” Under high heat, the gas deprives the iron ore of oxygen and produces nothing but water and sponge iron. This material, so called because of its pitted surface, is smelted into steel using electric arc furnaces without coking coal.

30 minutes south of Boden by car. hybrid— joint venture between sasabsteel manufacturers, Vattenfall, power companies, and Rukab, iron ore producers are piloting similar processes. In July, the board of German steel company Salzgitter gave the go-ahead for a €723 million project. Sarcos The company plans to replace its conventional blast furnace with a direct reduction plant (using some natural gas until it has enough hydrogen) by 2033. Other major European steelmakers, including ArcelorMittal and ThyssenKrupp, have similar plans.

Cement makers are heading in the same direction, albeit slowly. Limestone heating produces about 60% of the sector’s carbon emissions, and due to the lack of alternative technologies such as direct abatement in steelmaking, the industry primarily uses carbon capture and storage. We focus on reducing after-the-fact emissions (ccs). Many companies are experimenting with heating processes that replace the air with pure oxygen that produces CO.2 Suitable for isolation. Some are trying to use electricity instead of fossil fuels to heat the limestone. The most ambitious is the development of new low-carbon types of cement.

Heidelberg Cement, the world’s fourth largest producer of raw materials, has launched six low-carbon projects in Europe. They include ccs The facility in Brevik, Norway, and the world’s first carbon-neutral cement plant in Gotland, Sweden. Irish start-up Ecocem produces cement that uses less clinker, an intermediate material obtained from heated limestone, resulting in lower carbon emissions. Some companies are trying to recover cement from old concrete in demolished buildings.

The chemical industry faces perhaps its greatest challenge. Powering a steam cracker on electricity instead of natural gas is easy in principle, but not so easy in practice given the limited supply of low-carbon electricity. In addition, the chemical business breathes hydrocarbons, and many of its approximately 30,000 products are derived from hydrocarbons.

Still not giving up. Basfthe chemical giant is working with two rivals. Savich Linde has developed an electrically heated steam cracker for a town-scale factory in Ludwigshafen. The company wants to build a site in Antwerp, which emits 3.8 million tons of CO.2 To achieve this goal, Basf We recently purchased part of a wind farm off the coast of the Netherlands to provide carbon-free electricity. The company, like its cement counterparts, takes recycling seriously. Specifically, in a process called pyrolysis, plastic waste is burned in the absence of oxygen to break it down into its hydrocarbon components. Other companies are looking at different kinds of greener raw materials. afyreNA French start-up company.

Dozens of pilot projects, even for large projects with proven technology, do not translate into an environment. The hard part is scaling them up. The required infrastructure is either work in progress (clean power generation) or almost non-existent (hydrogen production and distribution). Costs remain high. The construction of an eco-friendly steel plant costs twice as much as a conventional steel plant, to three times as much as him. Especially in a remote, renewable energy-rich location like Boden, it can be difficult to attract workers. And rivals in other countries are not standing still. Some giant conglomerates, especially in India, are betting big on green hydrogen. Europe needs to hurry if it is to maintain its lead, warns Frank Peter of the Agora Energiewende think tank.

These are all real obstacles. But they don’t have to be insurmountable.To understand why, think again time2gshas convinced companies including . BMW, a carmaker and two white goods makers, Electrolux and Miele, will sign contracts for 1.5 million tonnes of raw steel. The order will act as collateral for the bank to fund two-thirds of the project (the rest will be funded by venture capital firms and his backing, which includes industrial giants such as Scania and Mercedes-Benz). come from equity investments by investors).

On the other hand, to attract hundreds of skilled workers and their families to remote Boden, if architects have their way, they can find housing in a complex that resembles a swanky resort. To secure hydrogen, another important input, time2gs In partnership with Spanish energy company Iberdrola, it aims to build a large plant in Western Europe that will produce gas, some of which will be supplied to other industrial users.

time2gsWe believe that the early establishment of our steel and hydrogen platforms will give us a significant advantage over our competitors. These include setting standards and grabbing some of the potentially lucrative business, such as the software that controls hydrogen and steelmaking equipment. For Europe to become a green industrial superpower, its governments and industrial giants will need to show similar ingenuity and ambition.

https://www.economist.com/business/2022/09/19/can-europe-decarbonise-its-heavy-industry Can Europe decarbonize heavy industry?

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