Hydrogen in steelmaking: the hype, the reality, and the limitations

Hydrogen has become one of the most talked-about solutions for decarbonizing steel production.

And for good reason: in ore-based steelmaking, it can significantly reduce Scope 1 emissions by replacing carbon with hydrogen in the iron ore–reduction process.

In conventional blast furnace steelmaking, the largest source of CO₂ emissions comes from the chemical reaction used to reduce iron ore. Oxygen in the ore bonds with carbon and forms CO₂.

If you replace carbon with hydrogen, the oxygen bonds with hydrogen instead and forms H₂O.

This is why hydrogen can reduce Scope 1 emissions for ore-based steelmakers. However, their Scope 3 emissions remain higher than those of scrap-based EAF producers due to iron ore mining, processing, etc.

But here is the part that rarely makes it into headlines: we already avoid the emissions that hydrogen is designed to solve. At SIJ, we produce steel by recycling scrap in electric arc furnaces (EAF), not by reducing iron ore.

The limitations of hydrogen

Hydrogen is promising, but its challenges are real, significant, and often understated.

Efficiency 

Conventional blast furnace steelmaking is more energy-efficient than hydrogen-based reduction. Coal and natural gas are much more efficient reducing agents than hydrogen, which requires higher energy input and heat to achieve the same chemical reaction. 

Hydrogen is also less effective, as it requires high quality iron ore containing 67% iron, which is scarce. Using pure hydrogen for DRI production can lead to variances in chemical compositions, potentially requiring modifications to downstream processing. 

You need renewables and a lot of them

Most hydrogen today is produced through steam methane reforming (SMR), which emits carbon monoxide (CO). To reduce overall emissions (not just shift them upstream), hydrogen must be produced using renewable electricity.
However, hydrogen production via electrolysis of water is energy-intensive and less efficient than SMR.
Producing 1 kg of green hydrogen requires about 56 kWh of renewable electricity. And making steel via green DRI requires around 60 kg of hydrogen per ton of steel.

This means more than 3,000 kWh of renewable electricity per ton of steel, just for hydrogen production.
Reliable large-scale operation would require enormous amounts of renewable energy. But renewable electricity is limited, inconsistent, and expensive.

Water usage

Producing hydrogen through electrolysis requires splitting water into hydrogen and oxygen. This process requires high-purity water to prevent equipment degradation.

Producing 1 kg of hydrogen requires approximately 10 liters of water. Such high water demand can strain freshwater resources and create additional environmental challenges.

Storage and transport of hydrogen

Hydrogen is extremely difficult to store and transport safely. It can cause embrittlement and cracking in steel pipes and vessels. Because hydrogen molecules are so small, they can diffuse into materials and escape through seals and connectors.

These factors make hydrogen infrastructure costly and technically complex.

Storage and transport of DRI

Hydrogen-reduced DRI is also challenging to store and handle.

DRI is highly reactive and prone to oxidation, which degrades its quality. As it rusts, it generates heat and when stored in large quantities, that heat can accumulate enough to ignite.

Safe handling and transport require inerting systems, constant monitoring, and strict safety procedures. This adds cost and complexity to the supply chain.

How Hydrogen Could Still Play a Role at SIJ

Although hydrogen is not a decisive factor in decarbonizing our scrap-based EAF route, it can still support emission reduction in specific parts of our process. In recent years, we have installed hydrogen-ready burners in our reheating furnaces, enabling the gradual substitution of natural gas with hydrogen. We are exploring local hydrogen generation as a way to manage deviations from forecasted electricity consumption. In cooperation with a partner, we are evaluating a microwave-plasma process that splits natural gas into hydrogen and graphene. The hydrogen could be blended into our internal natural gas network and used in our reheating furnaces, while the graphene can be sold or used to enhance our own products.

Pilot tests are already underway. Our steel plant has tested graphite electrodes enhanced with graphene to increase electrical conductivity and potentially reduce electrode consumption. Results are pending, but early indications show promising pathways for improving both efficiency and sustainability.

Hydrogen will not redefine our core steelmaking process, but applied in the right places, at the right scale, it can still contribute to reducing emissions and improving operational performance across our production chain. 

Global Efficiency Intelligence. (2024). Green H₂-DRI Steelmaking: 15 Challenges and Solutions

World Steel Association. (2022). Fact sheet, Hydrogen (H2)-based ironmaking.