Dissertation

The New Steel Map: Reconfiguring Supply Chains Around Renewable Resources

Devlin, Alexandra

2023

Overview

Steel is an indispensable component of our physical environment and the most consumed metal on earth at 2 billion tonnes per annum. Continuance of this consumption and production pattern is incongruent with climate change mitigation; steel production is deeply dependent on fossil fuels with the sector emitting about one-tenth of energy-related global greenhouse gas emissions. Decarbonisation must commence immediately to reach near zero-emissions by 2050 and not exceed the allocated 30-year carbon budget aligned to a 1.5°C global warming trajectory. This presents a hefty challenge given the fundamental change in energy inputs required, consequent modification of metallurgical processes, and restructuring of the supporting supply chains. Yet, a significant opportunity lies in transitioning the industrial sector towards electrification with zero-carbon electricity inputs. In terms of physical pathways to near zero-emissions, the current literature body focuses on process level improvements, whilst supply chain assessments from raw materials to markets are largely absent. The energy paradigm shift introduces multiple novel supply chain elements worth exploring, including green hydrogen and iron trade, matching variable renewables with processes of varying flexibility, and opening of green markets under carbon policies. This literature gap is addressed in this thesis through mathematical modelling and geospatial analysis at multiple scales, spanning individual processes to the complete supply chain, and applied in local, regional, and global contexts.The systems-based, locational research agenda allows exploration and evaluation of novel configurations for renewables-based steel supply chains. The technological focus is on hydrogen-based direct reduction of iron followed by the electric arc furnace, which reduces emissions to near zero and is rapidly reaching commerciality. The most significant tangible contributions of this thesis are the facility-level and supply chain optimisation models, which can be applied in any locality or region of interest. However, only through the meaningful case study analyses did critical insights emerge, of particular interest: (i) it is economically and energetically rational to reconfigure steel supply chains around high-quality renewables and iron ore deposits; (ii) co-locating hydrogen and iron production, and dislocating iron and steel production through green iron trade, introduces a valuable trade paradigm that takes advantage of upstream renewables whilst maintaining downstream market strongholds, (iii) iron ore producers have an integral part to play in the green steel transition, and a significant opportunity exists for these nations to transition from predominantly extractive to manufacturing economies, (iv) regional trade alliances and carbon policies are critical to green steel transitions, and (v) sectorial decoupling from fossil fuels requires well-timed investments and low-carbon energy system integration. Resource reallocation in the steel industry calls for supply chain restructuring; carrying over of fossil-based legacies will be a lost opportunity.

• Publisher: ProQuest Dissertations & Theses
• Subject: Climate Change / Ecology / Emissions / Energy consumption / Environmental science / Natural gas / Net present value
• ISBN: 9798302877772