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. 2025 Mar 18;59(10):4915-4925.
doi: 10.1021/acs.est.4c05756. Epub 2025 Mar 6.

The Role of Hydrogen in Decarbonizing U.S. Iron and Steel Production

Katherine H Jordan  1 , Paulina Jaramillo  1 , Valerie J Karplus  1   2 , Peter J Adams  1   3 , Nicholas Z Muller  1   4   5
Affiliations

The Role of Hydrogen in Decarbonizing U.S. Iron and Steel Production

Katherine H Jordan et al. Environ Sci Technol. .

Abstract

This study investigates the role of hydrogen as a decarbonization strategy for the iron and steel industry in the United States (U.S.) in the presence of an economy-wide net zero CO2 emissions target. Our analysis shows that hydrogen-based direct reduced iron (H2DRI) provides a cost-effective decarbonization strategy only under a relatively narrow set of conditions. Using today's best estimates of the capital and variable costs of alternative decarbonized iron and steelmaking technologies in a U.S. economy-wide simulation framework, we find that carbon capture technologies can achieve comparable decarbonization levels by 2050 and greater cumulative emissions reductions from iron and steel production at a lower cost. Simulations suggest hydrogen contributes to economy-wide decarbonization, but H2DRI is not the preferred use case for hydrogen in most scenarios. The average abatement cost for U.S. iron and steel production could be as low as $70/tonne CO2 with existing technologies plus carbon capture, while the cost with H2DRI rises to over $500/tonne CO2. We also find that IRA tax credits are insufficient to spur hydrogen use in steelmaking in our model and that a green steel production tax credit would need to be as high as $300/tonne steel to lead to sustained H2DRI use.

Keywords: blast furnace; carbon capture; direct reduced iron; energy systems modeling; hydrogen; industrial decarbonization; steel.

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Conflict of interest statement

The authors declare no competing financial interest.

Figures

Figure 1
Figure 1
Steel production by source. From left to right, row 1: Current policy, least-cost net-zero, net-zero no carbon capture. Row 2: Net-zero no carbon capture no MOE, net-zero no blast furnace carbon capture no MOE, net-zero limited scrap. Row 3: Net-zero no limits on scrap production, net-zero no BECCS + limited DAC.
Figure 2
Figure 2
Cumulative discounted costs of steel production by scenario. Costs by scenario and production method can be found in Figure S1. “Variable” refers to other variable costs, such as materials beyond scrap steel.
Figure 3
Figure 3
(a) Cumulative CO2 emissions by source from iron and steel production. “Non-NG Scope 1” emissions are non-natural gas process emissions, including emissions from coke and emissions from oxygen combusting carbon to CO, which later oxides to CO2. (b) 2050 economy-wide CO2 emissions by sector. “Supply” refers to upstream fuel supply emissions.
Figure 4
Figure 4
Economy-wide hydrogen consumption by end-use. “Transport” includes only hydrogen used directly in fuel cells, while “Synthetic Fuels” are hydrogen reacted with carbon dioxide to produce drop-in replacements for fossil sources and may be used in any sector of the economy. “Other Industrial” includes all industrial hydrogen consumption beyond what is used by the iron and steel industry.
Figure 5
Figure 5
Steel production by pathway under rising green steel PTCs for green hydrogen-based DRI. All scenarios include a linear emissions constraint from 2020 emissions levels to net-zero in 2050.
See this image and copyright information in PMC

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