Green Steel is expected to act as a key tool to reduce carbon footprints and meet the sustainable development goals of various countries in the future. Green steel is made using green hydrogen derived from renewable sources without fossil fuels. The consumer's & producers' propensity toward sustainable products and increasing government initiatives globally have contributed significantly toward bolstering the growth of the Global Green Steel Market.
In 2022, the Global Green Steel Market is in its embryonic stage. The stakeholders in the market are progressively investing in setting up greenfield projects and establishing partnerships & strategic alliances to transform their businesses. The global market is likely to be driven primarily by the mounting inclination of governments in the US, Canada, Germany, France, the UK, etc., toward lowering carbon emissions and adopting sustainable products & manufacturing practices in verticals, such as construction, electronic, industrial equipment, etc.
According to World Steel Association, in 2020, 1,860 MT (Million Tons) of steel was produced globally, which contributed to an average of 1.851 tons of CO2 into the atmosphere. Growing industrial emissions from steel products have compelled organizations to launch strategies and partnerships with private steel-making entities to boost the production of green steel globally.
As a result, various initiatives by the governments across Europe, North America, & APAC are expected to boost the Green Steel Market in the coming years.
|Middle East & Africa|
|Key Companies Profiled||Green Steel Group, H2 Green Steel, Deutsche Edelstahlwerke, Tata Steel, HYBRIT, Arcelor Mittal, Emirates Steel, Others (Jindal Steel, Thyssenkrupp, Baowu Group, etc.)|
|Unit Denominations||USD Million/Billion|
Impact of Covid-19 on the Global Green Steel Market
There has not been much impact of the Covid-19 pandemic on the Global Green Steel Market since it is still in the nascent stage and undergoing research & development, with just the pilot projects & orders delivered to consumers. With the ease of Covid-19 restrictions, the usage of green steel is predicted to surge in the upcoming years. Since automotive manufacturers have commitments towards reducing their carbon footprints on the earth, the demand for green steel among them is expected to rise in the coming years. Hence, automobile companies are likely to switch to fossil-free steel for manufacturing vehicles & their spare parts.
The Automotive industry is heavily reliant on steel for the vehicle body parts, including the roof, body, door panels, & beams between doors. According to the World Steel Association, on average, 900 kg of steel is used per vehicle and accounts for around 2.0-2.5 kg of carbon emissions when producing 1 kg of steel material for automobiles. The Green Steel Industry is also expecting to receive ample growth opportunities with various initiatives and growing investments from governments & industrial units in using green steel worldwide. For instance:
By Production Technology:
Of them all, the Electric Arc Furnace (EAF) technology is expected to gain a significant share in the Global Green Steel Market during the forecast period. Electric arc furnaces have witnessed extensive acceptance for carbon-free steel production. In 2020, Tata Steel announced its plan to produce green steel using the EAF technology. Besides Tata steel, ArcelorMittal, in the same year, announced its strategy of manufacturing fossil-free steel using EAF technology, thereby indicating the considerable hold of EAF in the overall market in the coming years and projecting a notable growth rate.
By End User:
Of them all, the Automotive & Transportation sector is expected to gain a considerable share of the Global Green Steel Market during 2022-27. The awareness amongst the automotive & transportation companies regarding their increasing carbon footprints, since the past, has been the key reason for them adopting greener products, such as green steel, while manufacturing automobiles & their spare parts. Companies like Daimler AG, Mercedes-Benz AG, & Volvo AB have shown great interest in green steel adoption.
Geographically, the Global Green Steel Market bifurcates into:
Here, Europe is anticipated to hold a significant market share in the upcoming years on account of the steadily increasing efforts to reduce carbon emissions from steel production. In 2020, ArcelorMittal, which has some of its major sites in Europe, has been the second-largest steel producer globally. According to the European Union, in 2019, Europe produced nearly 150 million tons of steel and has been generating around 221 MT of GHG emissions annually, which roughly translates to 5.7% of the total carbon emissions of the EU. Hence, the decarbonization of the steel industry has been identified as a significant step toward a greener future.
Although the Green Steel Market in Europe is still in its development phase, and the commercial availability of the steel is not expected until 2024, there still have been quite a few pilot projects testing the feasibility of manufacturing green steel. For instance:
Increasing collaborations across Europe also suggest the strong future of the Green Steel Market in the region over the forecast years. For instance:
Recent Developments by the Leading Companies:
H2 Green Steel, which has almost gathered a series A equity financing of approximately USD 61.1 million, is anticipated to start green steel production by 2024 and would attain 5 million tons of production capacity per year by 2030.
Key Driver: Increasing Government Support for Green Production in Prominent Industries
Governments worldwide are developing key hydrogen strategies and taking necessary initiatives to drive economies toward using green hydrogen in industries, such as refineries, manufacturing units, automotive, building & construction, etc. Countries like Japan, Singapore, Korea, & China in the Asia-Pacific region promote global supply chains and progress pertinent technologies. They have gained the attention of scientists, investors, and government associations toward utilizing green hydrogen in steel-producing industries to limit global CO2 emissions, which are around 8% that steel contributes. For instance:
Significant governments initiatives worldwide and a boost in partnerships between several public-private entities are expected to contribute to the global expansion of the Green Steel Industry during the forecast period.
Possible Restraint: High Costs Associated with Green Hydrogen Production
Due to the lack of infrastructure worldwide, the high production costs of green hydrogen, which are determined by the cost of renewable energy & electrolyzers, product efficiency, etc., might pose a challenge for the growth of the Global Green Steel Market in the coming years. Compared to conventional hydrogen production systems that cost around USD 1.5-2.3 per kg, the cost of electrolysis is 5 times costlier, i.e., around USD 10.3 per kg. Moreover, according to the Rocky Mountain Institute, the production price of full-scale hydrogen-based steel is 20%– 30% higher than conventional methods, which might also hamper the revenue growth of the global market.
Key Questions Answered in the Market Research Report:
Frequently Asked Questions
A. The Automotive & Transportation sector is anticipated to emerge as an area of lucrative opportunities for the leading players in the Global Green Steel Market during 2025-30.
A. Increasing government initiatives and partnerships with private entities to boost the production of sustainable products and lower CO2 emissions are expected to propel the growth of the Global Green Steel Market through 2030.
A. In the coming years, with various initiatives & massive investments from governments & industrial units, the Green Steel Market is expecting profitable growth opportunities worldwide.