Volvo hopes ‘green steel' will catch on

In its march toward a carbon-neutral future, Volvo Cars is targeting how its steel is made. Its hope: To adopt a new "green steel" that promises to eliminate the need for coking coal in its manufacturing process.

If the idea works, it could take a significant bite out of the CO2 in the automaker's supply chain.

The steel industry is among the three biggest producers of carbon dioxide because the industry is dominated by an iron ore-based steel- making technology that uses blast furnaces that depend on coking coal.

Every ton of steel produced in 2018 emitted on average 1.85 tons of carbon dioxide, equal to about 8 percent of global carbon dioxide emissions, according to the World Steel Association. That is why Volvo seeks to implement a process that could eliminate the use of coking coal — a major pollutant in steel making.

The Hydrogen Breakthrough Ironmaking Technology, or Hybrit — developed by steelmaker SSAB, iron ore producer LKAB and energy company Vattenfall — replaces coking coal with hydrogen.

Traditionally, oxygen is extracted from iron ore using coal to derive pure iron, an essential ingredient in making steel. But that high-energy process emits carbon dioxide.

The Hybrit system instead uses electricity generated from renewables to create hydrogen from water via electrolysis. The hydrogen is then used to remove the oxygen from the ore. The byproduct: water, not greenhouse emissions.

Making primary steel typically produces about 1.9 kilograms of carbon dioxide per kilogram of material, said Simon Buckingham, technical expert in metallic materials at Volvo Cars.

"Those C02 emissions would be mostly eliminated using hydrogen," he said.

Fossil-free steel could help Volvo's efforts to slash its carbon dioxide emissions by 40 percent by 2025 and become carbon neutral by 2040.

Steel makes up about 54 percent of the average vehicle, according to the American Iron and Steel Institute.

Of the total carbon dioxide emissions from the material and components that go into Volvo's cars, about 35 percent come from creating the steel and iron needed for a gasoline-powered model. That number drops to 20 percent in a full-electric vehicle.

Volvo estimates that by switching to fossil-free steel, it will significantly reduce those numbers.

"For us to have opportunities to deliver on our climate action ambitions, we need to address emissions around these raw materials," Buckingham said. "We make cars, but we do not make steel. So the collaboration with our supply chain is crucial as an enabler."

Volvo will begin testing steel made from hydrogen-reduced iron as early as this year, with the aim to build commercial vehicles with fossil-free steel potentially in 2026.

The automaker expects fossil-free steel to perform similar to conventional steel.

Volvo is working with SSAB to understand how the material performs in terms of durability and to ensure compatibility with the automaker's production processes, Buckingham said.

But Volvo isn't the only automaker to show interest in green steel. This month, Mercedes-Benz announced a partnership with SSAB on the new technology.

With its early backing of fossil-free steel, Volvo hopes to generate interest from more automakers.

"We as an OEM are trying to send a clear signal to the market that there is a strong demand for these products," Buckingham said, "and to pull the market with us so that we can have multiple suppliers in all the regions that we operate to be able to deliver lower CO2-intensity products."