The cradle of American steel is primed to catalyze a fledgling movement toward domestic fossil fuel-free steelmaking, according to a new report released this week by the nonprofit think tank Ohio River Valley Institute.
The report focuses on U.S. Steel’s Mon Valley Works as a potential model for transitioning from carbon-intensive legacy steelmaking to so-called green steel fueled by “green” hydrogen produced using renewable energy, and a renewably-powered electric arc furnace.
Fossil fuel-free steel production, the report says, has the potential to radically transform a declining regional steel industry clinging to 20th-century technology, mend poor air quality, boost quality of life and substantially reduce our region’s carbon footprint.
The report highlights the region’s trained workforce and over a century’s worth of existing steelmaking infrastructure, along with abundant water resources, access to iron ore and an untapped potential for wind energy in the surrounding Appalachian Mountains, which combined form a foundation ripe for a new generation of American steelmaking.
Globally, the iron and steelmaking industry emits 7% of greenhouse gas emissions and nearly a quarter of industrial carbon emissions. According to the International Energy Agency, steel emissions must be reduced by 50% by 2050, and continue to fall, to meet the world’s climate goals. And as the climate crisis accelerates, steelmakers are facing mounting market, investor and regulatory pressure to decarbonize.
A transition would not come without its challenges, though. The new report acknowledges Pennsylvania’s relatively underdeveloped renewable energy infrastructure as a potential constraint for a move to green steel. But the authors also argue that a commitment to fossil fuel-free steelmaking would likely spur the development of a regional green energy economy. All would require significant investment, to say nothing of political will.
U.S. Steel, the region’s most prominent steel producer, has signaled a commitment to decarbonization, though it has not committed to new local investments.
“Being green means that you make green,” said Jessica Graziano, the corporation’s chief financial officer, at an industry dinner in Pittsburgh last week. She rubbed her fingers together in the air. “We will be part of the solution.”
A tech transition
Traditional primary steelmaking uses carbon-rich coke (essentially purified coal) to melt iron ore in large blast furnaces, which is then made into steel. The process is used at U.S. Steel’s Edgar Thomson Works in Braddock. It emits about 2.2 tons of carbon dioxide per ton of steel made, with the blast furnace ironmaking process accounting for about 70% of greenhouse gas emissions from the integrated steelmaking process, per the report.
A fossil fuel-free direct reduced iron process, powered by hydrogen made from renewable energy like solar and wind and coupled with an electric arc furnace using renewable electricity, “is the most viable option near-term for achieving zero-emission primary steel production,” the report says.
Last year, a joint venture between a Swedish steel producer, SSAB and Finnish iron ore producer LKAB, delivered the first commercial batch of fossil fuel-free steel to Volvo group, the report notes, and similar green steel ventures are underway in Germany, Spain and Sweden, with projects also planned in Korea and China. “The U.S. is clearly behind,” the report concludes.
Pittsburgh’s regional geography and steelmaking legacy, the report says, buttress a switch to green steel. The region already has access to abundant water resources needed to make green hydrogen through electrolysis, and longstanding shipping routes have delivered iron ore to the Ohio River Valley from mines in Minnesota for generations.
A transition would undoubtedly require substantially more renewable energy, the infrastructure for which is lacking in the region. There is “huge untapped renewable capacity for wind in the Appalachian Mountains,” said Irina Spector, an author of the report.
Government incentives recently passed through the Inflation Reduction Act, Bipartisan Infrastructure Law and the CHIPS and Science Act, as well as mounting pressure for decarbonization from investors and regulators, the report says, present a “historic opportunity for green steel,” and form a situation in which greenification makes sense from both a climate and economic perspective.
Bringing back the steel economy?
A shift to green steel has the potential to revive a stagnant and declining industrial economy that has long struggled amid automation, outsourcing and offshoring, the report says.
A transition could grow regional jobs supported by the steel industry by 27% to 43% by 2031, a net increase of nearly 1,150 jobs. By contrast, continuing with “business as usual” legacy steelmaking, the report projects, would see regional jobs supported by the industry fall by 30% by 2031, or a net loss of over 800 jobs.
At the Association for Iron and Steel Technology dinner last week, Graziano said the Mon Valley Works is “an important part of our capacity … an important part of the way that we service our customers today and the portfolio of products that we have today.”
“We are committed to continuing to support our factories, our steelmaking, the way that we think about all of the aspects of our presence not just in Mon Valley, but also in Gary (Indiana) and in Granite City (Illinois) and various other aspects of our business for what they need today, and think about what are some of the urgent needs that we may have for tomorrow.”
U.S. Steel pulled out of a planned $1 billion investment in the Mon Valley Works in 2021 and recently shut down three coking batteries at the Clairton Coke Works. Graziano touted substantial investments that the corporation has recently made at a state-of-the-art facility in Arkansas. The company’s most recent annual report notes that U.S. Steel is keen to explore opportunities in direct reduced iron steelmaking, but makes no mention of where that might happen.
“Change right now is the biggest opportunity for our industry and for U.S. Steel,” Graziano said.
Quinn Glabicki is the environment and climate reporter at PublicSource and a Report for America corps member. He can be reached at quinn@publicsource.org and on Twitter and Instagram @quinnglabicki.
