Sweden has shown it has potential to become a pioneer in green steel production. This is stated in the study of Wood Mackenzie
Sweden’s steel industry produced 4.4 million tonnes (Mt) of crude steel (3.4 Mt of finished steel) in 2020, representing 3.2% of crude steel production (2.5% of total finished steel production) across EU-27 and the UK.
Despite its modest share in the region’s steel production, Sweden has been making headlines by being a frontrunner in the global race to produce fossil fuel-free steel at a commercial scale. At least two initiatives by HYBRIT and H2 Green Steel, separately, have been launched with a target to manufacture 10 Mt of crude steel annually by 2030.
Sweden’s decarbonisation drive in the steel industry signals substantial cost reduction potential for green steel over the coming decades, due primarily to declining cost of renewables and green hydrogen and increasing carbon prices.
The country boasts Europe’s largest iron ore reserves and excellent renewable energy resources – two primary prerequisites for the production of green hydrogen and decarbonised crude steel.
Although the HYBRIT and H2 Green Steel projects are backed by industrial heavyweights, some critical parts of the proposed value chain rely on technological solutions that have yet to be tested at an industrial scale, posing considerable challenges that must be overcome to deliver on the promises. Notably, both ventures have yet to find solutions for secure and economical storage of hydrogen.