Preparing for the Technology Transition in Steel Production (focus on Carbon Capture & Storage) OECD Steel Committee 5-6 December 2011, Paris John Newman Energy and Environment Consultant Outline Long-term production & emissions (to 2050) Necessity of CCS and breakthrough technologies Technology RD&D programmes Carbon Capture and Storage IEA/UNIDO Roadmap Policy Incentives and Financing Policy issues (for discussion) 1
Global steel production outlook Source: IEA, Energy Technology Transitions for Industry, Strategies for the Next Industrial Revolution (2009) Global steel emissions reduction challenge Source: IEA Energy Technology Transitions for Industry, Strategies for the Next Industrial Revolution (2009) 2
Emissions reduction & technology Source: Adapted from IEA Tracking Industrial Energy Efficiency and CO 2 Emissions (2007) Technology RD&D ULCOS Ultra-Low Carbon Dioxide Steelmaking (EU) COURSE50 (Japan) POSCO CO 2 Breakthrough Framework (Korea) AISI CO 2 Breakthrough Programme (USA) Australia, Brazil, Canada, China, Chinese Taipei WSA CO 2 Breakthrough Programme 3
Carbon Capture, Transport & Storage Capture Collecting CO 2 -rich stream (re-configuring process gas streams) Separating stream into CO 2, valuable gases (CO & H 2 ) and wastes Transport Pipeline (on-shore & off-shore) (gas) Ships and trucks (liquid) Storage Injection into depleted oil and gas fields and deep saline aquifers Enhanced oil recovery (EOR) and other valued uses Carbon Capture & Storage (ULCOS) ULCOS-BF top gas recycling blast furnace Pilot scale tests (1.5 tiron/hr), LKAB, Luleå, Sweden in 2007 Demonstration mid-sized blast furnace (700 ktiron/y) without storage, ArcelorMittal, Eisenhüttenstadt, Germany during 2013-2044 Demonstration large blast furnace (1 380 ktiron/y) with storage ArcelorMittal, Florange, France during 2015-2016 HIsarna Smelting reduction Pilot scale tests (8 tiron/hr), Tata, IJmuiden, NL in 2011 & 2012-13 ULCORED Advanced DRI Pilot scale tests (1 tiron/hr), LKAB, Luleå, Sweden in 2013 4
Carbon Capture & Storage (others). COURSE50 (Japan) Blast furnace with chemical or physical separation & waste heat use POSCO CO 2 Breakthrough Framework (Korea) Blast furnace with chemical separation FINEX with capture Emirates Steel Industries, Abu Dhabi Masdar (Abu Dhabi Future Energy Company) supported DRI with capture (800 ktco 2 /year) & EOR storage Final investment decision in 2011; with full-scale operation scheduled by 2015 Typical integrated mill vs. ULCOS BF mill Source: Birat, J.P., Steel sectoral report: Contribution to the UNIDO roadmap on CCS (2010) 5
Typical integrated mill vs. ULCOS BF mill Raw materials, energy, emissions and features Raw material and energy Features Units (per tonne rolled coil) Typical integrated steel mill ULCOS-BF Difference Coal kg 581 426 27% Natural gas m3 N 0 47.4 Electricity kwh 72 586 714% Power plant Yes No CO 2 capture unit No Yes CO 2 Emissions CO 2 captured kgco 2 0 812 CO 2 avoided kgco 2 0 1 172 CO 2 released kgco 2 1 815 643 65% Source: Birat, J.P., Steel sectoral report: Contribution to the UNIDO roadmap on CCS (2010) IEA/UNIDO Roadmap for Steel CCS Source: IEA/UNIDO, Technology Roadmap: Carbon Capture and Storage in Industrial Applications (2011) 6
CCS Incentives and Financing Gap (parallels to power sector) Source: McKinsey, Carbon Capture & Storage: Assessing the Economics (2008) and ZEP, EU Demonstration Programme for CO2 Capture and Storage (CCS) ZEP's Proposal Policy issues (for discussion) Iron & Steel Industry Additional measures needed to further the development of CCS and to ensure its deployment when commercially ready? How should these measures be financed? Governments Measures needed to provide the incentives for, and encourage the financing of, the development and early deployment of CCS by the iron and steel industry? Development agencies and international organisations (including OECD Steel Committee) Roles in fostering effective and equitable policies towards CCS in the iron and steel industry? 7
Summary Today s best technologies are not clean enough to reconcile long-term steel production and emissions reduction challenges. CCS & breakthrough technologies needed quickly. RD&D now; deployment in 10-20 years? Today s policies and carbon prices provide inadequate incentives and financing to support the needed transition. Roles of industry, government & institutions in preparing for unprecedented scale & speed of transition to low carbon future? Thank you for your attention. John Newman Energy and Environment Consultant newman@alum.mit.edu 8