Steel ministry to explore green hydrogen usage

The steel ministry has roped in an in-house consultancy to explore the use of green hydrogen in the direct reduction of iron (DRI) and blast furnaces.

Iron and steel is the most emissions-intensive industry and reducing its carbon footprint is vital to the government’s ambitious net zero target.

A few months ago, the ministry of new and renewable energy issued guidelines for green hydrogen pilots in the steel sector. The pilots to be implemented through the steel ministry received budgetary outlay of Rs. 455 crore till FY 2029-30.

Under the scheme, financial support is to be provided to promote three approaches to use hydrogen in iron and steel production.

These include the gradual substitution of natural gas with hydrogen in vertical shaft-based DRI, the injection of hydrogen into blast furnaces to decrease coal and coke consumption, and a pilot to produce DRI using 100 percent hydrogen in a consortium model.

The direct reduced iron (DRI) process is a method of producing iron without melting the ore. Instead, it reduces iron ore in its solid state using reducing gases, hence is less carbon intensive.

In 2023, the renewable energy ministry launched the National Green Hydrogen Mission to make India a global hub for production, use and export of Green Hydrogen and its derivatives.

So far, 14 task forces have been set up by the ministry on different facets of more eco-friendly steel production, touching upon aspects such as raw materials, technology, and policy frameworks.

The steel sector accounts for about 12 percent of India’s carbon dioxide emissions, with an emission intensity of 2.55 tonnes of CO2 a tonne of crude steel (tCO2/tcs) compared with the global average emission intensity of 1.85 tCO2/tcs, according to the Institute for Energy Economics and Financial Analysis (IEEFA).

India aims for an annual production of 5 million metric tons of green hydrogen by 2030, which would cut about 50 million metric tons of carbon emissions and save more than $12 billion in fossil fuel imports.

The challenge, however, is that green hydrogen is more expensive to produce compared to the hydrogen made from fossil fuels, with a price difference of approximately $2 a er kilogram.

Renewable energy is not available continuously, and battery storage remains uneconomical.

Green hydrogen is the hydrogen generated from electrolysis of water, with the entire process based on renewable energy. It is being touted as the enabler of transition to sustainable energy.