steel: the material for a sustainable future/media/files/a... · sources: hiraki et al. 6 not...

Steel: the material for a sustainable future

Europe Media Day

Paris, 11th December 2018

David Clarke,

Vice President, Head of Strategy and Chief Technology Officer

What is common about all of these plausible futures?

1


• Why is the sustainable future made of steel?

• What is the nature of the carbon challenge for steel?

• What are the possible solutions to this challenge?

• How is ArcelorMittal addressing the challenge?

2

3

…driving…

Demographic shifts

Accelerating urbanisation

Global megatrends…

Climate change, environmental

stress, and pollution

Digitalisation &hyper-connectivity

Global geo-political and economic shifts

Technologicalbreakthroughs

• Shifts in social awareness and lifestyle demands

• Policiesreinforcing sustainable development

• Businesses to improve resource use efficiencies, reuse and recycling

… towards sustainable economic model

supported by the digital economy

Low carboneconomy

Environment Circulareconomy

sustainable economy

Global megatrends are driving the world towards a

sustainable economic model

Source: ArcelorMittal Corporate Strategy

4

Circular, easy to recover and 100% recyclable

sustainablesteel

Preferred material, universally used in very diverse sectors

Nature friendly, “rusts” back

Key material for our future sustainable economy


Preferred material, nature friendly and supportive of a circular

economy: steel is at the heart of the sustainable future

Steel

high

230mt

Magnetic; easy to separate from waste streams

$100-150/t

lower risk of downcycling

5

End of lifeFiberglass

-

-

X

-

Only used as energy

Source: ArcelorMittal Corporate Strategy analysis

Recyclability

Recovery value

Cement

-

-

X

-

Only down-cycling

Material-to-material

recycling

Ease to segregate

material to material

Plastics

low

36mt

Closed loop needed to effectively to recycle

$30-500/t

risk of downcycling

Aluminium

med

18mt

Alloying risk of down-cycling

$700-900/t

Closed loop to sustainably recycle

Recycled volumes

With unmatched recyclability and ease to segregate, steel

remains by far the most recycled material globally

removable during melting

Steel has a limited number of hard to remove elements; hence steel can be easily recycled while keeping original quality.

6Sources: Hiraki et al.

not removable during melting

Aluminum has a lot of hard to remove elements during

melting; hence it is very difficult

to be recycledwhile keeping

original quality.

Steel is generally more recyclable than competing materialsRecyclability of complex end of life vehicle’s materials

7Sources: ArcelorMittal

• In June 2018 ArcelorMittal launched in Europe its new philosophy for steel in construction: Steligence®

• Described as ‘the intelligent construction choice’, Steligence®

enables architects, engineers, building owners and urban planners to resolve the competing demands of flexibility, creativity, economics and sustainability

• Key benefits include

– Reduced storey height due to thinner, steel + composite flooring systems, permitting more storeys within a given height

– Less deep foundations due to decreased weight of steel buildings

– Wider column-free spans, permitting total and repeated layout flexibility so that building life is extended

– Extraordinary range of exterior façade treatments; more creative, more durable, and with self-healing characteristics

• Steligence® harnesses the sustainability credentials of steel not just in terms of its unmatched recyclability, but also its potential for re-use of steel components without need for melting down

ArcelorMittal’s new HQ in Luxembourg, currently under development, will be a showcase for the Steligence® philosophy, and a truly circular building

New steel concept for sustainable steel in construction ArcelorMittal headquarters to be the showcase

Steligence®, a new steel construction philosophy

to support sustainable construction






8

* Defined as end of life material recycled to make same material again

Sources: WSA, World Aluminium, Plastics Europe, ArcelorMittal Corporate Strategy analysis

0%

50%

100%

0

2

4

1990

2000

2010

2018

Fiberglass

Primary

0

1,000

2,000

3,000

4,000

5,000

1990

2000

2010

2018

Cement

Primary

0

1,000

2,000

1990

2000

2010

2018

Steel

Primary

Secondary*

0

20

40

60

80

1990

2000

2010

2018

Aluminium

Primary

Secondary*

0

200

400

1990

2000

2010

2018

Plastics

Primary

Secondary*

9

Sources

Mill

ion

to

nn

es

Global production

Global consumption for most materials has tripled since 1990;

material production today relies heavily on primary sources

As with virtually all materials, producing steel from primary

sources requires significant energy, today’s main source of

CO2 emissions

10

Primary sources

Secondary sources

FeO

OO

Fe

Metallurgicalcoal and gas

FeO

OO

Fe

FeO

OO

Fe

FeFe

Fe

Fe

FeFe

C

FeFe

Fe

Fe

FeFe

CFeFe

Fe

Fe FeFe

C

powerRecycled steel scrap steel

Iron ore steelIron

CC

CC

OO

C

OO

C

e-

CO2OO

C

OO

C


18-22 GJ for a tonne of steel

5-7 GJ for a tonne of steel

FeFe

FeFe

FeFeC

MetallicMelting,RefiningPre-metallic

OO

oxygen

OO

oxygen

Smelting

steel glass aluminium plastics fiberglass cement

Competing materials face similar challenges, with comparable

or even higher CO2 emissions in primary source production

11

Primary source

Secondary source

* Underestimation as it does not include end of life emissions if material not recovered (up to 3kg CO2 per kg of plastic)


*

CO2 emissions by material, primary and secondary sourceskg CO2 per kg material

12

AutomobileBody in white

Steel900kg

1.8t CO2

Aluminium470kg

5.6t CO2

Steel16.3 tonnes

Fiberglass10.4 tonnes

33t CO227t CO2

Yacht46’ trawler

Bottle0.75l

Glass420g

Steel177g

350g CO21,800g CO2

Building structureone storey 5x8m

Concrete32 tonnes

Steel2.6 tonnes

5t CO25t CO2

Piping system3 metres of 6” schedule 80

Steel130kg

260kg CO2

Plastic (PVC)27kg

60kg CO2

Steel versus other

materials

* Only emissions from production of material from primary sources (virgin); does not take into account lifecycle CO2 emissions of different materials


CO2 when produced

from primary sources

As such, for many applications, steel remains the best option

today in terms of overall CO2 emissions and recyclability

2761

124

432

70101

563

384

India Developing(other)

China Developed

The need for primary steel will continue for decades

driven by growth in the developing world

13

Finished steel consumption growthkg steel per capita

Sources: WSA, United Nations, ArcelorMittal Corporate Strategy analysis

2001

2018






14

There is a global commitment to significant emissions

reductions; Europe has set ambitious goals

15

0

10

20

30

40

50

60

1995 2005 2015 2025 2035 2045

CO

2em

issi

on

s* (g

igat

on

nes

)

0

1

2

3

4

5

6

1990 2000 2010 2020 2030 2040 2050

Power

Other

Industry

Agriculture

Transport

Other fuel

-20%

-40%

-80%

CO

2em

issi

on

s* (

giga

ton

nes

)

EU long term commitment

* Greenhouse gases (CO2, N2O, CH4, HFC, PFC, SF6, NF3) emissions in CO2 equivalent

do nothing scenario

contain temperature rise to only 2°C

contain temperature rise to only 1.5°C

+40%

-40%

-80%

Global greenhouse emissions futures European greenhouse emissions commitment

Low carboneconomy

Paris Accords

Sources: European Environment Agency (EEA) via Eurostat

Effective reductions in power sector CO2 emissions have

only come through significant government investment and

production support in renewables

16

Europe CO2 emissions from power and heating

mill

ion

to

nn

es C

O2

emis

sio

ns • Investment in renewables has

averaged over €80B annually between 2008 and 2015

• Government investment and production support to renewables power increased from €21 to over €44 billion annually between 2008 and 2015

Sources: EEA, Ecofys, NERA, ArcelorMittal Corporate Strategy analysis

0

400

800

1,200

1,600

2,000

1990 1995 2000 2005 2010 2015

Actual power and heating emissionsAvoided emissions from renewables (since 2005)

6 10 24 62 146 279

13% 14% 15% 15% 21% 30%Renewables production

(% of total power)

Renewables capacity(GW)

Policy, energy and technology developments will be the key

determinants of successful lower emissions pathways for

steelmaking

17Source: ArcelorMittal Corporate Strategy

Competitive energy availability

Policy evolution

ENERGYBio materials and bio fuels markets

Lower emissions steelmaking technology developments

CO2Successful

pathways to lower emissions

low CO2low CO2

low CO2

18Sources: WSA, United Nations, Ecology Global Network, ArcelorMittal Corporate Strategy analysis

Today (2017) (2050)Steel: 2.5 - 3.0 billion tonnesPopulation: 9.7 billion

Steel: 1,700 million tonnesPopulation: 7.3 billion

CO2 emissions

low CO2

Fossil fuels

Successful pathways will come through a combination of

renewable energy sources, renewable biomass and waste,

and carbon capture storage and use

O2 O2

Renewable power

Fossil fuels with carbon capture, reuse and storage

CO2

Renewable biomass and waste, carbon reuse

CO2

Sustainable future

19Source: ArcelorMittal Corporate Strategy analysis

low CO2

Lower emissions could be reached using fossil fuels and

carbon capture storage and use

Blast Furnace route

Coke

PCI

•Develop carbon storage in Europe (up to 200mtpa CO2)

•Opportunity to increase bio fuel and bio materials to substitute fossil fuel chemicals and plastics

Fossil fuels with carbon capture,

reuse and storage

CO2

Carbon use

Carbon storage

Cost challenge

Technology challenge

Energy infrastructure

challenge

• Adapt existing steel industrial footprint

PCI & coke PCI & coke with CCU

PCI & coke with CCS

Hydrogen(natural gas & CCS)

Carbon capture and use (CCU) & storage (CCS)

Net energy costs

Other costs

Hydrogen based DRI

Carbon storage


low CO2

Lower emissions could be reached using renewable biomass

and waste, and carbon capture storage and use

Renewable Biomass and waste, carbon reuse and

storage

CO2

Cost challenge



challenge

•230mtpa sustainable Biomass and waste: (est. 400mtpa available today)

•Develop bio-coal (70mtpa) and bio coke (35mtpa)•Carbon storage infrastructure (up to 200mtpa CO2)

Blast Furnace route

Carbon useBio-coke

Bio-coal

Carbon storage

SteelanolR&D

ToreroR&D

• Adapt existing steel industrial footprint

PCI & coke Bio-PCI & bio-coke

Bio-PCI & bio-coke with CCS

Bio-PCI & bio-coke with CCU

Carbon capture and use (CCU) & storage (CCS)

Net energy costs

Other costs


low CO2

Lower emissions could be reached using renewable power

sources and new technologies

Water electrolysis

•Green Hydrogen: +485TWh of electricity consumption (+15% today’s consumption)

•AEE or MOE: +300-400TWh (+9-12% today’s consumption)

O2O2

Renewable power

Hydrogen based DRI

MOE

AEE

Cost challenge



challenge

SIDERWINR&D ULCOLYSIS

R&D

• Completely new steel industrial footprint

PCI & coke Green hydrogen(electricity)

Aqueous Alkaline Electrolysis (AAE)

Molten oxide electrolysis (MOE)

Carbon capture & storage (CCS)

Net energy costs

Other costs






22

23

Advance lower emissions

steelmaking technologies

Advance public policy to support

“sustainable” steel transition

Stakeholder engagement

An evolving CO2 target plan

1

4

2

30ArcelorMittal’s response to the carbon challenge


We are developing a CO2 reduction plan leveraging best

practices and technologies as well as cost-effective innovations

24


1

• Continuous improvement, leveraging best practices

• Implementing proven technologies, including maximising off gas reuse

• Incorporating cost effective innovations as they become commercially viable

• Adapted to industrial footprint and different geographies

IGARImproving carbon use as reductant in blast furnace

R&D and pilot project (€20M)2MW plasma Dunkerque, FranceStart up 2021-2022

25

ArcelorMittal Lower emissions steelmaking breakthrough projects

Source: ArcelorMittal Corporate Strategy, CTO, Global R&D, FCE

2 2

SteelanolMake ethanol from process gases

ethanol

Pilot plant (€125M)80 million litres ethanolGent, BelgiumStart up 2020

ToreroProcess waste wood to use as PCI substitute

Pilot plant (€45M)250,000 tpa biomassGent, BelgiumStart up 2020

siderwin

Pilot plant (€8M)2MW plasma mESIERE, FranceStart up 2021-2022

Electrolysis of iron oxide

R&D and pilot project (€20M)100 kg iron platesGlobal R&D Maizières, FranceStart up 2021-2022

Innovating on potential technologies to prepare ArcelorMittal

for plausible lower CO2 emissions futures

26Source: ArcelorMittal Government Affairs and ArcelorMittal Corporate Strategy

Policy needs to ensure a level playing field, otherwise erosion

of steel industry in Europe without reducing emissions globally

CO

2€

Co

sts

€

CO

2€

Co

sts

€

CO

2€

Co

sts

€

CO

2€

Co

sts

€

ETS phase IV impacts to European steel (from 2020)

• Industry free allowance surpluses expire

• Unrealistic benchmarks could lead to increase of marginal production costs by ~50€/t steel in Europe

• European steel industry could be in significant disadvantage versus global competition

• Risk to viability of European steel industry without making any headway to lower emissions globally

Co

sts

€

Co

sts

€

Co

sts

€

33

27

• Level playing field globally for “sustainably” produced steel

• Priority access to renewable energy at preferential rates (sustainable biomass etc.)

• Financing and incentives for R&D and investment to transition to sustainable steelmaking

Challenges for steel industry Policy support needed

• First movers towards low emissions steel penalised with structurally higher costs than competitors

• Abundant, cost effective energy supply from renewable sources is necessary

• Significant investment required to develop new technologies and transform industrial footprint

Source: ArcelorMittal Strategy and ArcelorMittal Government Affairs

•Border tax / input cost parity / tax credits

•Mandated “green” steel standards

•Preferred renewables consumer status for power, biomass & waste

•Financial loans•Research grants

Instruments

33

Steel industry cannot go at it alone, policy will have to

support the transition towards sustainable steel

What is common about all of these plausible

futures?

28

steel: the material for a sustainable future/media/files/a... · sources: hiraki et al. 6 not...

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