The metallurgical sector is undergoing an unprecedented transformation. According to McKinsey & Company, steel, aluminium and other metal production accounts for around 8% of global CO₂ emissions and has come under scrutiny to reduce its environmental impact. At the same time, renewable hydrogen is emerging as a promising alternative for decarbonising the sector, redefining its value chain and making it more sustainable.
Renewable hydrogen is produced through water electrolysis using electricity from renewable sources such as solar or wind energy. This creates a zero-emission resource, unlike grey hydrogen, which is made from natural gas and produces CO₂ emissions.
This is particularly important in industries such as metallurgy and steel production. Steel is the most widely used material in the world after concrete. It is primarily manufactured in blast furnaces that use coal as a reducing agent for iron ore. This process emits large amounts of CO₂. However, Direct Reduced Iron (DRI) technology using green hydrogen can replace coal with this renewable gas, producing only water vapour as a by-product.
Steel, aluminium and other metal production is under scrutiny to reduce its environmental impact
Germany is a global role model due to its clear strategy for transforming its steel industry. The most high-profile projects include Salzgitter AG, which is developing the SALCOS programme (Salzgitter Low CO₂ Steelmaking) with a view to replacing coal with green hydrogen in its steel production process.
The company is currently developing a 100 MW electrolysis plant in the United States, which will significantly reduce CO₂ emissions. Meanwhile, energy company VNG is working on another plant in Saxony-Anhalt, where green hydrogen will be produced for local industries, including metallurgy. These projects come under the German government’s industrial decarbonisation aid package, which prioritises steel as a key sector in the energy transition.
Germany is leading the way in integrating renewable hydrogen into metallurgy with its ambitious climate agenda. The HYBRIT project, led by SSAB, LKAB and Vattenfall, has set out to produce CO₂-free steel by replacing coke with renewable hydrogen during the reduction process. This is a world-leading project that aims to produce the first batch of fossil-free steel by 2026.
In Sweden, steel-making giant SSAB is also developing the same technology, looking to drastically reduce emissions from its steel production. In 2020, SSAB successfully produced pilot-scale hydrogen-based steel in partnership with companies such as Vattenfall, signalling a major milestone in the heavy industry’s transition towards decarbonisation.
Germany leads the way with key projects to replace coal with green hydrogen in steel production
Norway is also making a key contribution, particularly with its focus on producing hydrogen from hydroelectric power. Companies such as HydrogenPro are developing renewable hydrogen production plants powered by hydroelectric energy, which is then used for industrial applications, including metallurgy.
Elsewhere in the world, Australia’s Asian Renewable Energy Hub project clearly demonstrates how green hydrogen can be used not only domestically but also as a strategic export product. With the potential to generate up to 26 GW of renewable energy, this project is primarily designed to supply Asian countries such as Japan and South Korea, which are seeking to decarbonise heavy industrial sectors such as metallurgy. South Korea’s POSCO, one of the largest steel producers, is already using hydrogen in its pilot plants as a coal alternative for steel production.
Renewable hydrogen is not just changing the way we make steel. In aluminium production, it can be used as fuel in recycling and remelting processes, significantly reducing emissions. In Norway, Hydro has produced the first batch of recycled aluminium fuelled by renewable hydrogen, demonstrating a viable transition even in sectors traditionally dependent on fossil fuels.
Meanwhile, although its application is less direct, industries such as copper and zinc are also looking to harness its potential in reducing metal oxides.
Industrial activity makes up around 22% of total emissions in Spain, according to MITERD data
Spain is emerging as a leader in renewable hydrogen development, especially in the metallurgical sector, which is one of the largest CO₂ emitters in the country, second only to transport. According to the Ministry for the Ecological Transition and Demographic Challenge, the industrial sector accounts for roughly 22% of Spain’s total greenhouse gas emissions.
Hydnum Steel, a new steel plant to be built in Puertollano (Ciudad Real), is one of the most important projects in Spain linked to the decarbonisation of the steel industry through renewable hydrogen. This project falls in line with the National Integrated Energy and Climate Plan (PNIEC in its Spanish acronym), which promotes industrial decarbonisation and includes plans to build electrolysis plants to produce hydrogen.
Institutionally, Spain is rolling out key initiatives to set itself up as a green hydrogen hub in Europe. The Spanish hydrogen infrastructure network and the future H2med corridor, connecting the Iberian Peninsula with France and Germany, exemplify how the country is creating infrastructure to facilitate the transmission, export and use of hydrogen in industrial sectors, including steel.
As such, progress towards emission-free metallurgy is underway, although its success will depend on how effectively governments, businesses and innovation centres can collaborate. Investment in infrastructure, cost reduction and support policy development will be key to turning renewable hydrogen from a promise into a reality.
As the world moves towards a decarbonised economy, metallurgy has the chance to reinvent itself and transition to an increasingly sustainable model.
