Hydrogen prices would need to fall to below Eur1.50/kg in an "adjusted prices scenario," which assumed prices falling to reflect potential future fossil fuel price drops, Hydrogen Europe said in its "Steel from Solar Energy" report, published May 11.
The estimated breakeven CO2 price in both scenarios is Eur140/mt, it said.
European carbon allowance prices for December 2022 delivery under the emissions trading scheme settled at Eur88.83/mtCO2e on May 11, according to a Platts assessment published by S&P Global.
The report models the costs for hydrogen-based direct reduction of iron ore coupled with an electric arc furnace, versus a base case of blast furnace steel production.
Blast furnace steel production typically produces around 1.6-2.0 mt of CO2 per ton of crude steel.
