Removing molten iron from a pilot scale facility at Boston Metal’s facilities in Woburn, Massachusetts.
Image courtesy Boston Metal
The $1.6 trillion steel industry is the backbone of the modern world. They also contribute significantly to global warming, accounting for between 7% and 9% of global carbon dioxide emissions, according to the World Steel Association.
This is why huge global corporations, including the international steel giant Arcelor Mittal We champion technology Microsoftinvest in it Boston Metala company that spun off Massachusetts Institute of Technology and developed a new method for making clean steel.
“There is no economy, there is no infrastructure without steel,” said Boston Metal CEO Tadeo Carneiro to CNBC on a video call on Wednesday. So when it comes to the decarbonization industry to fight climate change, “It’s a big piece of the puzzle. I don’t think that’s clear to everyone,” Carneiro said.
In 2013, MIT professors Donald Sadaway And Antoine Allanour published a Paper in the journal Nature With laboratory results proving that it is possible to produce steel without emitting carbon dioxide emissions. That same year they launched a company, Boston Electrometallurgical Corp. To expand and commercialize this technology.
In 2017, Carneiro joined the company as CEO. He is a veteran 40 years of experience in the steel industry, mostly in Brazilian metal giant CBMM. In 2018, Boston Metal raised its price The first round of financing is $20 millionOn a guided tour breakthrough energy projectsthe climate investment firm founded by one of the founders of Microsoft Bill Gates.
Gates has stressed for years the need to think about decarbonizing the manufacturing sector. Transport gets a lot of attention but is responsible for only 16% of global emissions, as manufacturing generates it 31%According to Gates’ bookHow to avoid a climate catastrophe. “
Gates writes: “Whenever I hear an idea of what we can do to control global warming – whether it’s a boardroom or a cheeseburger – I always ask this question: What’s your plan for steel?” on his own blog in 2019.
Boston Metal announced Friday that it has raised a $120 million Series C round, led by multinational steel giant ArcelorMittal, also funded by Microsoft’s Climate Innovation Fund.
With the funding, Boston Metal will ramp up production of green steel at its pilot facility in Woburn, Massachusetts, and will support the construction of its Brazilian subsidiary, Boston Metal do Brasil, where the company will manufacture various metals. Carneiro told CNBC that it plans to start building a pilot steel plant in 2024 and a commercial-sized plant in 2026.
Boston Metal Team.
Image courtesy Boston Metal
ArcelorMittal’s carbon cost
For ArcelorMittal, making steel without greenhouse gas emissions is not only a responsibility, but also a business necessity in accordance with Irina GorbunovaVice President and Head of the XCarb Innovation Fund at ArcelorMittal.
“Our clients are asking for it, our investors are expecting us to relocate and our people – and our future workforce – want to work for a company that is part of the solution, not part of the world’s climate problem,” Gorbunova told CNBC.
“We’re increasingly seeing the cost of carbon,” Gorbunova told CNBC. in Europe , Emissions Trading System or ETSAlready putting a price on carbon emissions, Gorbunova told CNBC.
“The EU has been at the forefront of climate policy, but it’s reasonable to expect other regions to follow. So, there is a business case for us to decarbonise as well,” Gorbunova told CNBC. “Zero or near-zero emissions steel will become a reality. The only question is how quickly we can make that journey. If steel companies don’t decarbonise, they won’t stand the test of time.”
Ironically, steel is a key component of many technologies being created to remove carbon, such as the wind toward electric cars, Gorbunova said.
Microsoft doesn’t make cars or make steel, but it’s trying It meets its aggressive climate targetswhich includes being carbon negative by 2030 and removing all of the company’s historic carbon emissions since the company’s founding in 1975.
Boston Metal CEO Tadeu Carneiro worked in the steel industry for decades before coming to lead MIT.
Image courtesy Boston Metal
How does Boston Metal do it?
Traditionally, the first step in steel production is to combine iron ore or iron oxide, which is mined from the ground, with coal in a superheated blast furnace. This process generates significant carbon dioxide emissions.
Scrap recycling is also an essential part of the global industry, Carneiro said, accounting for 30% of steel production (70% in the US), and has a “much smaller” carbon footprint.
Boston Metal’s technology, molten oxide electrolysis, runs electricity through iron oxide mixed with what Carneiro calls “a soup of other oxides” to make iron and oxygen. Oxides are chemical compounds that contain at least one oxygen atom, and the Boston process includes such common oxides as alumina, silica, calcium, and magnesium.
“There is no carbon” in the process of making iron this way, Carneiro said.
However, heating this soup to the required 1,600 degrees Celsius would require significant electrical energy – making 1 million tons of steel per year would require 500 megawatts of basic clean electricity, or about Half of the electricity needed to run a medium-sized city. “The availability of electricity will determine how quickly the process can be carried out,” Carneiro said.
Electricity has to be clean too, or it defeats the whole purpose.
“We believe in the future, we will have abundant, reliable, environmentally friendly and cheap electricity in order to use this process and make green steel,” Carneiro said.
Other processes are being developed to make clean steel using hydrogen, Carneiro said, but they require very pure iron oxide, and only about 4% of marketed iron ore is suitable.
Boston Metal would eventually license its technology to steel companies, not the steelmaker itself.
“Every steelmaker is in touch with us to understand our progress and when we’re going to go commercial,” Carneiro told CNBC. “They’ve all pledged to be carbon neutral by 2050. And they don’t really have a solution right now. So, they really need a solution at scale, and only our technology can reach these billions of tons.”