Exploring the Role of Hydrogen in Decarbonizing Heavy Industry

Abstract

Hydrogen is increasingly being seized upon as a widespread decarbonization solution. There are a number of potential applications for hydrogen and investments are being funneled into demonstration projects. In this thesis work I explore the economic competitiveness of hydrogen in two heavy industry applications; steelmaking and high temperature heating. These processes rely on fossil fuels for multiple attributes and there is not another low carbon alternative fuel that has all of these characteristics. I find that in all regions, low carbon hydrogen production costs are currently more expensive than fossil fuels. High temperature heating with hydrogen increases the cost of clinker by 58-225%, and raw glass by 16-73%. Applications of hydrogen in steelmaking increase steel costs by 24-90%. Cost ranges represent the different costs when using Blue or Green 𝐻2. As a competing low carbon steel production pathway, I also assessed steelmaking with CCS which increased steelmaking costs by (∼14%). Using the MIT Economic Projection and Policy Analysis (EPPA) model, I examined the deployment of 𝐻₂ based steelmaking and steelmaking with CCS under a deep decarbonization policy scenario. Results show that at current costs deployment is limited prior to 2050. However, if costs are reduced then these technologies can deploy rapidly (achieving up to 100% of the share of global steel production by 2050). Adoption of decarbonization technologies is regionally specific and there can be regional advantages to deploying certain production pathways.