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The efforts of the steel industry, which accounts for 40% of the carbon dioxide (CO2) emissions of the entire manufacturing industry, are essential for decarbonization. Technological innovation must be sped up to enhance competitiveness.
Japan’s major steel companies are mainly engaged in blast furnace production. In this process, iron ore reacts with coke made from coal to remove oxygen and produce extremely pure iron. This process generates a large amount of CO2.
The major steel companies have set a goal of reducing CO2 emissions by 30% by 2030 from the 2013 level, and reaching net-zero in 2050. But it will be difficult to achieve this goal if the production system remains centered on blast furnaces.
Therefore, there is a move to convert their facilities to electric furnaces. Electric furnaces produce steel by melting ferrous scraps with heat generated by electricity, reducing CO2 emissions to about a quarter of those from blast furnaces.
The global trend is toward selecting materials that emit less CO2 in the manufacturing process, and the use of electric furnaces is an understandable response to this trend.
Nippon Steel Corp. has begun commercial operation of an electric furnace in Hyogo Prefecture, while JFE Steel Corp. plans to suspend operation of a blast furnace in Okayama Prefecture and build a new large-scale electric furnace.
However, if the operation of electric furnaces consumes large amounts of electricity from thermal power plants, the effect of decarbonization will be small. There are also concerns about possible rising costs due to soaring electricity prices.
In addition, it is difficult to remove impurities such as copper from ferrous scrap, which is the raw material for electric furnaces, and at present the process is said to be unsuitable for the production of steel products for automobiles and home appliances, which require high quality.
It is only appropriate that the conversion to electric furnaces is viewed as a transitional measure.
What is seen as an ace in the hole is a new steel manufacturing technology that uses hydrogen. This process removes oxygen from iron ore by having iron ore react with hydrogen, and it is expected to drastically reduce CO2 emissions.
It is important that the public and private sectors work together on this project. Nippon Steel, JFE Steel and Kobe Steel, Ltd. have begun cooperating in efforts to utilize hydrogen. The three companies plan to invest about ¥430 billion, 40% of which will be supported by the government. The companies aim to commercialize the technology in the mid-2040s.
However, technical challenges have yet to be overcome. Compared to using coke, it is difficult to raise the temperature inside the furnace sufficiently to extract the iron. Even if the technology could be established, mass production would require a huge capital investment.
Decarbonization of the steel industry is a global issue, and China and Europe are also providing large-scale support for research and development of hydrogen-based steelmaking, with the competition intensifying.
Japan’s steel industry has long prided itself on its technological capability to produce high-quality steel products. It is hoped Japan will lead the world in decarbonization of the steel industry and support the foundation of the domestic manufacturing industry.
