Deployment of a green hydrogen-based energy solution for the hard-to-abate steel sector

Green hydrogen offers a sustainable decarbonization solution for the hard-to-abate steel manufacturing sector. Nonetheless, limited practical strategies were found for deploying green hydrogen at scale in operational steel plants. The objective of this study is to develop a system-level, techno-economic framework for the deployment of green hydrogen in the Direct Reduced Iron (DRI) process of the Italian steel industry. This study compares two green hydrogen production technologies, Proton Exchange Membrane (PEM) and Alkaline Water Electrolysis (AWE), at a 5 MW scale, which is powered by an 8 MW solar photovoltaic (PV) system. Moreover, a 100 km pipeline constructed with API X80 steel was reviewed as a realistic hydrogen transport strategy due to its scalability, cost efficiency, and proven resistance to hydrogen embrittlement. Following this, an assessment of a well-suited hydrogen storage method for industrial use was conducted. Our findings revealed that while AWE offers a lower capital cost (€9.72 million), PEM is superior in terms of scalability, efficiency, and economic viability. Furthermore, PEM has a shorter payback period (9.9 years vs. 15.83) and higher annual revenue (€2.45 million). We identified compressed gas storage as the most feasible short-run solution due to its deployment readiness and technical maturity. Overall, the findings of this study favour PEM, along with pipeline transport and compressed storage system, as a viable techno-economic framework for the green steel transition. This study provides valuable insights for policymakers on several key initiatives: retrofitting existing DRI-EAF plants with green hydrogen-enabled infrastructure, relocating storage systems near steel clusters, advancing PEM innovation to enhance catalyst durability and reduce costs, and supporting carbon credit systems and green steel certification to improve market competitiveness.