The Middle East and North Africa (MENA) is in a prime position to emerge as a world leader in carbon-neutral or green steel, according to the latest research.
Green steel opportunity in the Middle East and North Africa, a study by the Institute for Energy Economics and Financial Analysis (IEEFA), says the region’s steel sector is dominated by direct reduced iron-electric arc furnace (DRI-EAF) technology. This releases lower emissions than the increasingly obsolete coal-fuelled blast furnace and basic oxygen furnace process, which was used in 71% of global crude steel production last year.
The DRI-EAF process, which uses syngas made from natural gas or gasified coal and electricity, could produce zero emissions if green hydrogen and electric arc furnaces were powered by renewable energy, the study says. MENA produced just 3% of global crude steel in 2021 but accounted for nearly 46% of the world’s DRI production.
“MENA has an established supply of DR-grade iron ore and its iron ore pelletising plants are among the world’s largest,“ said IEEFA’s steel sector energy finance analyst Soroush Basirat, who carried out the research. “MENA’s knowledge of this specific steel technology is an invaluable asset. This production knowledge, abetted by further work on iron ore beneficiation, pelletising and DR plants, is among the most important steel decarbonisation pillars, and will greatly assist MENA’s transition.
“Compared to other regions, MENA’s existing DRI-EAF capacity means no extra investment is needed for replacing the base technology. All new investment could be focused on expanding production of green hydrogen among other renewables. If it acts fast, MENA has the potential to lead the world in green steel production.”
The study also noted that MENA has formidable solar resources to aid the production of green hydrogen from renewable electricity. The World Bank found that MENA has the globe’s highest photovoltaic power potential capacity and could theoretically produce more than 5.8 kilowatt hours per square metre daily. The region is predicted to add 83 gigawatts (GW) of wind and 334GW of solar power by 2050, increasing wind and solar’s share of energy capacity from 1% and 2% respectively to 9% and 24%.