IDEAS home Printed from https://ideas.repec.org/a/zbw/jumsac/295051.html
   My bibliography  Save this article

Turning German Steel Production Green: Quantifying Diffusion Scenarios for Hydrogen-Based Steelmaking and Policy Implications

Author

Listed:
  • Preis, Philipp

Abstract

The German steel industry is in jeopardy. Current steel production must be comprehensively transformed to achieve the emission targets imposed by the Federal Climate Change Act. A promising alternative that has increasingly gained momentum in recent years is hydrogen-based steel production. This thesis analyzes the potential of this method to transform the German steel industry. First, drivers that will decisively influence the future role of hydrogen-based steelmaking are identified. Subsequently, these drivers are linked in a quantitative model to develop explorative diffusion scenarios and to draw conclusions for policymaking. Four representative scenarios are extracted and analyzed. Large differences between the scenario outputs illustrate that the diffusion of hydrogen-based steelmaking is subject to significant uncertainties. It becomes clear that the most effective lever for promoting the attractiveness of hydrogen-based steelmaking is increasing the cost of conventional production by exposing it to CO2 prices. However, such exposure simultaneously suggests disadvantages towards producers that are not subject to this regulation. To mitigate the emerging risk of carbon leakage effects, suitable policy measures are required.

Suggested Citation

  • Preis, Philipp, 2023. "Turning German Steel Production Green: Quantifying Diffusion Scenarios for Hydrogen-Based Steelmaking and Policy Implications," Junior Management Science (JUMS), Junior Management Science e. V., vol. 8(3), pages 682-716.
    • Handle: RePEc:zbw:jumsac:295051
    DOI: 10.5282/jums/v8i3pp682-716
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/295051/1/5227-3531.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.5282/jums/v8i3pp682-716?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Alexander Otto & Martin Robinius & Thomas Grube & Sebastian Schiebahn & Aaron Praktiknjo & Detlef Stolten, 2017. "Power-to-Steel: Reducing CO 2 through the Integration of Renewable Energy and Hydrogen into the German Steel Industry," Energies, MDPI, vol. 10(4), pages 1-21, April.
    2. Sergei Sidorov & Alexey Faizliev & Vladimir Balash & Olga Balash & Maria Krylova & Aleksandr Fomenko, 2021. "Extended innovation diffusion models and their empirical performance on real propagation data," Journal of Marketing Analytics, Palgrave Macmillan, vol. 9(2), pages 99-110, June.
    3. Abhinav Bhaskar & Mohsen Assadi & Homam Nikpey Somehsaraei, 2020. "Decarbonization of the Iron and Steel Industry with Direct Reduction of Iron Ore with Green Hydrogen," Energies, MDPI, vol. 13(3), pages 1-23, February.
    4. Frédéric Branger, Philippe Quirion, Julien Chevallier, 2017. "Carbon Leakage and Competitiveness of Cement and Steel Industries Under the EU ETS: Much Ado About Nothing," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    5. Alla Toktarova & Ida Karlsson & Johan Rootzén & Lisa Göransson & Mikael Odenberger & Filip Johnsson, 2020. "Pathways for Low-Carbon Transition of the Steel Industry—A Swedish Case Study," Energies, MDPI, vol. 13(15), pages 1-18, July.
    6. Kirschen, Marcus & Badr, Karim & Pfeifer, Herbert, 2011. "Influence of direct reduced iron on the energy balance of the electric arc furnace in steel industry," Energy, Elsevier, vol. 36(10), pages 6146-6155.
    7. Okereke, Chukwumerije & McDaniels, Devin, 2012. "To what extent are EU steel companies susceptible to competitive loss due to climate policy?," Energy Policy, Elsevier, vol. 46(C), pages 203-215.
    8. Paltsev, Sergey & Morris, Jennifer & Kheshgi, Haroon & Herzog, Howard, 2021. "Hard-to-Abate Sectors: The role of industrial carbon capture and storage (CCS) in emission mitigation," Applied Energy, Elsevier, vol. 300(C).
    9. Stefan Pauliuk & Niko Heeren, 2021. "Material efficiency and its contribution to climate change mitigation in Germany: A deep decarbonization scenario analysis until 2060," Journal of Industrial Ecology, Yale University, vol. 25(2), pages 479-493, April.
    10. Valentin Vogl & Max Åhman & Lars J. Nilsson, 2021. "The making of green steel in the EU: a policy evaluation for the early commercialization phase," Climate Policy, Taylor & Francis Journals, vol. 21(1), pages 78-92, January.
    11. Lars J. Nilsson & Fredric Bauer & Max Åhman & Fredrik N. G. Andersson & Chris Bataille & Stephane de la Rue du Can & Karin Ericsson & Teis Hansen & Bengt Johansson & Stefan Lechtenböhmer & Mariësse va, 2021. "An industrial policy framework for transforming energy and emissions intensive industries towards zero emissions," Climate Policy, Taylor & Francis Journals, vol. 21(8), pages 1053-1065, September.
    12. Arens, M. & Worrell, E., 2014. "Diffusion of energy efficient technologies in the German steel industry and their impact on energy consumption," Energy, Elsevier, vol. 73(C), pages 968-977.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anissa Nurdiawati & Frauke Urban, 2021. "Towards Deep Decarbonisation of Energy-Intensive Industries: A Review of Current Status, Technologies and Policies," Energies, MDPI, vol. 14(9), pages 1-33, April.
    2. Lopez, Gabriel & Galimova, Tansu & Fasihi, Mahdi & Bogdanov, Dmitrii & Breyer, Christian, 2023. "Towards defossilised steel: Supply chain options for a green European steel industry," Energy, Elsevier, vol. 273(C).
    3. Julian Suer & Marzia Traverso & Nils Jäger, 2022. "Review of Life Cycle Assessments for Steel and Environmental Analysis of Future Steel Production Scenarios," Sustainability, MDPI, vol. 14(21), pages 1-22, October.
    4. Skoczkowski, Tadeusz & Verdolini, Elena & Bielecki, Sławomir & Kochański, Max & Korczak, Katarzyna & Węglarz, Arkadiusz, 2020. "Technology innovation system analysis of decarbonisation options in the EU steel industry," Energy, Elsevier, vol. 212(C).
    5. Bożena Gajdzik & Radosław Wolniak & Wies Grebski, 2023. "Process of Transformation to Net Zero Steelmaking: Decarbonisation Scenarios Based on the Analysis of the Polish Steel Industry," Energies, MDPI, vol. 16(8), pages 1-36, April.
    6. Wang, Xiaoyang & Yu, Biying & An, Runying & Sun, Feihu & Xu, Shuo, 2022. "An integrated analysis of China’s iron and steel industry towards carbon neutrality," Applied Energy, Elsevier, vol. 322(C).
    7. Alla Toktarova & Ida Karlsson & Johan Rootzén & Lisa Göransson & Mikael Odenberger & Filip Johnsson, 2020. "Pathways for Low-Carbon Transition of the Steel Industry—A Swedish Case Study," Energies, MDPI, vol. 13(15), pages 1-18, July.
    8. Hu, Xueyue & Wang, Chunying & Elshkaki, Ayman, 2024. "Material-energy Nexus: A systematic literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 192(C).
    9. Haendel, Michael & Hirzel, Simon & Süß, Marlene, 2022. "Economic optima for buffers in direct reduction steelmaking under increasing shares of renewable hydrogen," Renewable Energy, Elsevier, vol. 190(C), pages 1100-1111.
    10. Weiss, Robert & Ikäheimo, Jussi, 2024. "Flexible industrial power-to-X production enabling large-scale wind power integration: A case study of future hydrogen direct reduction iron production in Finland," Applied Energy, Elsevier, vol. 365(C).
    11. Qiu, Ziyang & Yue, Qiang & Yan, Tianyi & Wang, Qi & Sun, Jingchao & Yuan, Yuxing & Che, Zichang & Wang, Yisong & Du, Tao, 2023. "Gas utilization optimization and exergy analysis of hydrogen metallurgical shaft furnace," Energy, Elsevier, vol. 263(PC).
    12. Rissman, Jeffrey & Bataille, Chris & Masanet, Eric & Aden, Nate & Morrow, William R. & Zhou, Nan & Elliott, Neal & Dell, Rebecca & Heeren, Niko & Huckestein, Brigitta & Cresko, Joe & Miller, Sabbie A., 2020. "Technologies and policies to decarbonize global industry: Review and assessment of mitigation drivers through 2070," Applied Energy, Elsevier, vol. 266(C).
    13. Tobias Hübner, 2020. "Small-Scale Modelling of Individual Greenhouse Gas Abatement Measures in Industry," Energies, MDPI, vol. 13(7), pages 1-43, April.
    14. repec:spo:wpmain:info:hdl:2441/1gt6nhe6vs8pbb86oi81bt6838 is not listed on IDEAS
    15. Mikovits, Christian & Wetterlund, Elisabeth & Wehrle, Sebastian & Baumgartner, Johann & Schmidt, Johannes, 2021. "Stronger together: Multi-annual variability of hydrogen production supported by wind power in Sweden," Applied Energy, Elsevier, vol. 282(PB).
    16. Christoph Sejkora & Johannes Lindorfer & Lisa Kühberger & Thomas Kienberger, 2021. "Interlinking the Renewable Electricity and Gas Sectors: A Techno-Economic Case Study for Austria," Energies, MDPI, vol. 14(19), pages 1-38, October.
    17. Stede, Jan & Pauliuk, Stefan & Hardadi, Gilang & Neuhoff, Karsten, 2021. "Carbon pricing of basic materials: Incentives and risks for the value chain and consumers," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 189.
    18. Antimiani, Alessandro & Costantini, Valeria & Kuik, Onno & Paglialunga, Elena, 2016. "Mitigation of adverse effects on competitiveness and leakage of unilateral EU climate policy: An assessment of policy instruments," Ecological Economics, Elsevier, vol. 128(C), pages 246-259.
    19. Salvatore Digiesi & Giovanni Mummolo & Micaela Vitti, 2022. "Minimum Emissions Configuration of a Green Energy–Steel System: An Analytical Model," Energies, MDPI, vol. 15(9), pages 1-21, May.
    20. Lin, Weiming & Chen, Jianling & Zheng, Yi & Dai, Yongwu, 2019. "Effects of the EU Emission Trading Scheme on the international competitiveness of pulp-and-paper industry," Forest Policy and Economics, Elsevier, vol. 109(C).
    21. Naegele, Helene & Zaklan, Aleksandar, 2019. "Does the EU ETS cause carbon leakage in European manufacturing?," Journal of Environmental Economics and Management, Elsevier, vol. 93(C), pages 125-147.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:jumsac:295051. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://jums.academy/en/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.