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Pressure on the steel industry to reduce carbon emissions is accelerating the use of green hydrogen (GH2) as an alternative to Coal. According to the Oak Ridge National Laboratory, GH2 can help the U.S. steel industry reduce greenhouse gas (GHG) emissions to almost zero by 2050, while steel production can increase 12% over that period.
For this scenario to become a reality, the industry must achieve near-zero emissions via energy efficiency improvements and transition to low/no-carbon fuels and electrification. Transformative technologies like hydrogen-based steel production, iron ore electrolysis, and carbon capture, usage, and storage (CCUS) technologies must combine to achieve effective decarbonization.
The transition to GH2 is critical for addressing hard-to-abate emissions applications like ironmaking. The industry must learn to manufacture and scale hydrogen production cost-effectively through sufficient renewable energy integration. Digitalization of operations is the key to enabling changes to the status quo.
Digitalization steps that ease green hydrogen integration
Minimizing carbon footprint and reducing total capital and operational expenditure ̶ while increasing GH2 integration involves four digitization steps:
1. Integrated design and simulation – green hydrogen production is an electro-intensive process requiring energy system designs with robust power and process simulation modeling. Until recently, process modeling approaches to develop concept designs often required multiple software tools.
However, new digital twin design solutions integrate digital simulation with 3D detail engineering and construction engineering tools to:
- Enable seamless transitions, thereby reducing engineering time
- Reduce error and re-work risks
- Establish a base for a final engineered digital twin model that unifies both process and power designs
- Integrate power and process simulation for a complete end-to-end analysis of the facility’s design
- Enhance performance while maintaining design integrity between process and power equipment
2. Optimized electrical distribution – Gigawatt-scale GH2 plants must support new-generation steel plants. Top priorities to broaden GH2 adoption include decreasing production costs and increasing available supply. Today, hydrogen costs $3-6/kg to produce, but its production costs must decrease to $1-2/kg to provide a competitive alternative to natural gas. New scalable and modular power distribution solutions serve to lower costs and bridge the cost gap. These optimized power architectures use standardized compact equipment to enable hydrogen plant scalability. Consider solutions like electrical distribution design optimization tools, rectifier solution consulting, and E-Houses to help transition to lower-cost yet robust electrical distribution schemes.
3. Safe and efficient operations and maintenance (O&M) – Hydrogen, a flammable gas, can cause fires and explosions if improperly handled. These safety issues make its production an ideal candidate for combined power and process systems with integrated safety and cybersecurity. This type of system will tightly integrate Distributed Control (DCS), Energy Management and Control (EMCS), and Safety Integrity Systems.
Digital twin solutions can further embed safety throughout the design stages. These combined systems help:
- Lower CapEx
- Reduce required hardware
- Shorten engineering and functional testing time
- Minimize the need for commissioning
- Integrate control platforms, predictive simulation and optimization unified operations, asset performance management, and cybersecurity software
4. Competitive renewable energy – A robust hydrogen integration strategy will influence long-term steelmaking bottom lines. To lower energy costs (~20-40% of production costs), some steel producers are moving to geographies with lower-cost renewables (like Nordics with cheaper and plentiful renewable power). Others enter into long-term power purchasing agreements (PPAs) that lock in a fixed energy price over an extended period. More are developing energy strategies with the help of qualified consultancies working to optimize a mix of energy sources and use artificial intelligence (AI) forecasting tools. New energy management systems can also help orchestrate distributed energy resources (DERs) and manage power purchasing for hydrogen production when prices are low.
Partnership fosters green steel success
The steel industry’s commitment to lower emissions is consistent with Schneider Electric’s core values around sustainability. We have digitized over 200 of our own global plants and distribution centers. Organizations such as Corporate Knights and the World Economic Forum have acknowledged our decarbonization efforts.
Along with our software partners, AVEVA and ETAP, we can help steel industry stakeholders accelerate decarbonization efforts by offering sophisticated tools to track CO2 emissions across the entire plant’s lifecycle. To learn more, download the ‘Green Steel Transformation’ brochure and watch our on-demand webinar.