As we sure this entire production isn’t simply management trying to extract more and more free money from the government? “daddy, where do Trillion dollar deficits come from?”
Steve
Maybe. We’ll see if the government is willing to shovel more money out the door. However, it is not new news that hydrogen-produced steel is much more expensive than conventional. In addition, this is steel, not Nvidia chips. Low-cost production is very important.
DB2
This is the strategy China has used over the past 20 years to dominate the solar panel, battery, and EV industries. It is the strategy it is currently using to compete in silicon chips, AI, and nanotech.
The government identifies a business sector that is undeveloped but with great potential and creates a market where businesses can compete to develop the technology more rapidly than other nations.
To put things in perspective, the US spends over $30B annually in subsidies to agriculture, with the primary benefits going to rural red states and counties. This is double what is spent on clean energy. If you want to talk about shoveling money out the door, perhaps a broader discussion is required.
Consider for example how many billions we spend trying to control the southern border, spurred primarily from cries coming out of the mainly agricultural red states. Meanwhile it is estimated that a whopping 30% of agricultural workers are undocumented and about double that foreign born. The hypocrisy is startling. The border is porous because the very folks most verbally against immigration, both illegal and legal, keep hiring immigrants.
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It is not clear that hydrogen fits that category. Hydrogen is more of a Mission Improbable, as a thread title this summer put it.
DB2
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Nonsense. Hydrogen will be a major and growing part of the future economy. Hydrogen is necessary for the production of fertilizers that are increasingly needed for the new varieties of fast growing/high yield crops being developed. This means that there is a market for developing efficient and cost-effective green methods of producing hydrogen. Lots of nations are trying to do this.
One highly motivated region is the EU, as it tries to wean itself from its dependence on Russian natural gas. EU demand for hydrogen is expected to grow rapidly through 2030, with export contracts already being signed.
The EU will have its choice of international suppliers, given the range of interested parties developing export-oriented projects in Australia, Southeast Asia, Africa, the Middle East, and North and South America. Several countries have formally agreed to provide green hydrogen to specific EU Member States through early exports, The Value of Green Hydrogen Trade for Europe - RMI.
Cheap green hydrogen will make practical its use in other industries. One of the first will probably be heating, as hydrogen can take advantage of the natural gas infrastructure. Concurrent with this will be the adoption of hydrogen in heavy industry.
The international competition for hydrogen-steel production is on, with the US unfortunately lagging a bit.
Diversified majors like Baowu (China) and ArcelorMittal (Luxembourg), the two largest steel companies in the world, are testing both the CCS and hydrogen routes. ThyssenKrupp (Germany), Posco (South Korea) and TataSteel IJmuiden (the Netherlands) plan to fully convert their fleets to hydrogen-based production. They are developing new equipment to accommodate lower-grade iron ore in hydrogen-based steelmaking. SSAB (Sweden) is at the forefront of hydrogen-based steelmaking but plans to primarily rely on purer forms of iron such as recycled steel.
Nippon Steel and JFE (both from Japan) aim to reduce emissions by applying CCS to existing coal-based blast furnaces but have recently started to investigate hydrogen too. While US Steel is somewhat lagging behind its peers, it will likely roll out pilots for both CCS and hydrogen on the back of increased policy support in the US…
But the real change might not come from the steel majors who have billions of dollars worth of coal-based steel assets on their balance sheets. On a positive note, that provides them the capital to develop CCS and hydrogen. On a more negative note, it could limit real change as current assets may become stranded once hydrogen technology takes over.
Disruptive change might be driven by Tesla-style new entrants. Vulcan Green Steel from Oman is a new company in the industry that is planning to build a hydrogen-based steel plant from scratch. Blastr is doing similar things in Norway and Finland. GravitHy in France focuses on the production of green iron. Van Merksteijn is planning to build a green steel facility to produce a specialised steel product (wire rod) at the Eemshaven in the Netherlands. The H2 Green Steel mill in northern Sweden is currently the most advanced green steel project in Europe. Hydrogen sparks change for the future of green steel production | ING
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That is what the Shinies call “big gummit picking winners and losers”. Their solution is always, in every case, throw more “no strings” money at the “JCs”, so they can use it as they wish.
Steve
Ha! Ha! That is rich! 
It is only $750 Million. We gave away $800 Billion in forgivable covid loans during the last admin - and much of that was outright fraud.
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Are you suggesting that the government should not work with businesses to develop new technologies?
Exactly how much of the world’s economy do you want the Chinese to control?
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All the Chinese take-out places…
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Could be. Or rather than being like batteries hydrogen projects may turn out to be more like the synfuels projects. One can certainly, for example, turn coal into liquids for fuel, but it is not energetically or economically practical.
I suspect that it will turn out to be more practical to make steel the conventional way and use carbon capture to zero things out.
DB2
IMO, more nonsense. Synfuels “failed” mainly because batteries for powering cars improved so quickly. There may still be a market for synfuels in ships and airplanes.
The global hydrogen market is already at $240B and growing. The demand for green hydrogen within that market is increasing rapidly. An increasing number of locations have periods of excess solar/wind electricity generation. Using that excess energy to produce hydrogen is a no-brainer.
Is that suspicion based on your expertise as a climate change skeptic?
Hydrogen-green steel is a rapidly growing industry in Australia, Brazil, and parts of Africa and the nonOPEC Middle East, places with lots of solar/wind and iron ore.
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That makes no sense. Did you live through the '70s and '80s?
The point of the Cleveland-Cliffs news is that the end product (automobile steel) is the same to the car companies regardless of the production method. What we have is the government trying to encourage a more expensive way to manufacture the commodity. At the same time the administration isn’t even providing enough subsidies.
The administration needs to a) up their subsidies, b) mandate inflation per Leap or c) spend the money on carbon capture research.
DB2
Big picture time:
-the Shinies don’t want government directing anything. Their “big gummit picking winners and losers” has been a talking point of their faction for years. Their solution to everything is for the government to give huge piles of loot to the “JCs” and leave it entirely up to the “JCs” to decide what to do with it.
-the Shinies don’t want to pay to educate other people’s spawn. They seem perfectly happy to have everything they want engineered and built in socialistical countries that give away education, so their people have the means to do the engineering and building. Recall, one part of “2025” is closing the Dept of Education, and cutting off all Federal education spending.
-the Shiny view of Shiny-land is a “service economy” where the Shinies make their loot by financial speculation and manipulation, while the Proles are menials, with minimal education, who polish their private jets and limos, and clean out their drains.
Steve
This doesn’t make sense to me either. The US transportation sector consumes about 4.9 billion barrels of petroleum a year. As others have pointed out many times on this board, that number is unlikely to change very much for a long time.
Even if synfuels could replace a fraction of that it would solve an enormous number of problems.
Synfuels couldn’t compete with gas in the 70’s and 80’s and now cannot compete with batteries. Synfuels for passenger autos makes no economic sense either now or in the foreseeable future even in a mandated zero-carbon world.
We know empirically that through a combination of incentives and mandates, that EV adoption can surpass 50% in new vehicle sales without major disruptions of the transportation infrastructure or the economy. Given finite resources it’s questionable why synfuels should be given support that could go to EVs.
That could change if tech advancements make synfuels competitive as a gas replacement. But that doesn’t seem likely in the near future while batteries continue to improve at a remarkable pace.
What we have is the government trying to encourage research and development of a currently more expensive (but socially beneficial) way to manufacture steel in order to accelerate cost reduction.
The hydrogen economy is rapidly developing. The question is how big a player will the US be in this economy. Batteries are replacing coal and oil. Hydrogen will replace natural gas and iron coke.
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You can only pick two of those words at a time to make a sentence that matches physics IMO
Mike
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I assume you are suggesting that there is no such thing as cheap green hydrogen.
Curtailment occurs when there is more renewable energy than the grid needs or can handle. That energy gets wasted. The variability of renewables means that wind/solar gets overbuilt so as to provide more flexibility during less optimal periods. As a result, the energy lost due to curtailment has been increasing.
https://www.eia.gov/todayinenergy/detail.php?id=60822
If that wasted electricity was used to produce green hydrogen, the economics is much improved.
This has been suggested for the UK. https://www.rechargenews.com/wind/turn-wasted-wind-power-into-green-hydrogen-and-save-uk-billions-study/2-1-1583623
This is an evaluation of this strategy for California. Evaluating the Economic Impact of Using Curtailed Renewable Energy Sources for Green Hydrogen Production | IEEE Conference Publication | IEEE Xplore
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Sure, but just because the extra energy is free for a couple hours per day, the capital costs of all the electrolysis equipment, etc is sitting there wasted for the other 20-22 hours of the day most days of the year. This can’t possibly end up being cost effective, IMO.
If this is such a great business idea why doesn’t some company do it?
My first thought is that they just want some government funding for a science project that they already know the answer to.
Or they are fossil fuel companies that want to build out a big demand for hydrogen since they know in the future that excess renewables won’t be able to provide; and there will be a “temporary” need for non-green hydrogen in the mean time.
Mike
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Reducing emissions at blast furnace-converter route would also be costly and challenging…
Production costs will soar, requiring more than $150/mt extra to produce iron, compared to iron that comes from conventional blast furnaces, according to Baosteel data…
DB2
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The English have a company called Bramble making hydrogen busses.
This is something from Toyota.
I guess it won’t ever work and anyone outside of America making something work successfully is an i.d.i.o.t.
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