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Energy-Efficiency Improvements for the U.S. Steel Industry

According to a first-of-its-kind study by EETD researchers, the U.S. iron and steel industry could cost-effectively reduce its energy use by 18% while producing the same amount of iron and steel. The reduction in energy use would result in a 19% reduction in emissions of greenhouse gases, according to the study, which examined the steel industry's current practices and the potential costs and savings of adopting 47 retrofit technologies.

Ernst Worrell, Nathan Martin, and Lynn Price, of Berkeley Lab's Environmental Energy Technologies Division, authored the study. It is the first in a series of assessments of various U.S. industries and a product of the team's effort to develop a national and international database of industrial energy use. With the help of experts throughout the world in the International Network of Energy Demand In the Industrial Sector (INEDIS) network (see following article), EETD's study is one of the first to assess the cost-effectiveness of technologies to improve the industry's energy efficiency. Improving energy efficiency of the steel industry not only reduces its energy costs and pollutant emissions, but can also make the industry more competitive.

Among the world's eight largest steel-producing nations, South Korea, Germany, and Japan have the most energy-efficient steel industries. South Korea's industry is the most energy-efficient, using fewer than 20 gigajoules (GJ) per metric ton of steel in 1994 (the higher the energy intensity, the lower the energy efficiency of the industry). The U.S. stands at slightly over 25 GJ/metric ton (1994). Reviewing the industry as a whole, U.S. steel plants are relatively old and production has fluctuated dramatically in the recent past. Steel production in the U.S. peaked at 136 million metric tons in 1973, and then fluctuated between 1974 and 1982, when production crashed to 68 million metric tons, due to weakened global demand for steel as well as the closure of older, less competitive mills. Except for a couple of periods of decline, production began to grow slowly again and by 1998 reached 98 million metric tons.

Between 1958 and 1994, the U.S. steel industry modernized—closing open-hearth furnaces, increasing use of continuous casting, introducing new energy-efficient electric arc furnaces—and improved its energy efficiency. Even so, additional technologies exist to reduce energy use for steel production. The report's 47 energy-efficient measures range from technologies that are specific to the steel industry to general process improvements that are widely adaptable to different industries. Examples of the former category include direct fuel injection in the blast furnace, scrap preheating in the electric arc furnace, and thin slab casting. General process measures include improved process maintenance and the use of an energy-monitoring and control system to regulate a steel plant's energy use.

For example, thin slab casting consolidates the casting and hot rolling steps of steel production into one, dramatically reducing energy use by 5 GJ per metric ton, due to energy and material savings. Although investments are estimated at $135 per metric ton, production costs are reduced by $25 to $36 per metric ton. This results in a simple payback period of just over three years. Several U.S. plants use this technology, but many more could implement it.

Many of the other technologies described in the report are in a similar state of deployment: they are used in steel industries throughout the world, including the U.S., but the wider use of some of these technologies in the U.S. would help improve competitiveness and energy efficiency.

Graph: The first supply curve for energy savings in the U.S. iron and steel industry.

The first supply curve for energy savings in the U.S. iron and steel industry. The figure shows that using a hurdle rate of 30% for investments, we can improve energy efficiency cost-effectively by 18% by adopting all commercially available technologies that fall below the weighted average price of fuel.

EETD's researchers ranked the individual technologies and practices, which were organized in a so-called energy-savings supply curve, depicting the potential of energy efficiency improvement as a function of the costs to achieve these savings (see Figure). An energy-savings supply curve can schematically represent information on the selected practices and technologies, as well as help to identify low-cost opportunities.

The study team plans to investigate the energy efficiency of other U.S. industries, including cement, pulp and paper, chemicals, and petroleum refining. They are also working to assess energy-efficient measures that are applicable to many different industries, such as steam production and distribution systems.

— Allan Chen, Ernst Worrell, and Lynn Price

For more information, contact:

  • Ernst Worrell
  • (510) 486-6794; fax (510) 486-6696
  • Lynn Price
  • (510) 486-6519; fax (510) 486-6696

"Energy Efficiency and Carbon Emissions Reduction Opportunities in the U.S. Iron and Steel Sector," Berkeley Lab Report No. LBNL-41724, is available from Ernst Worrell and Lynn Price or at the Industrial Energy Analysis web site.

This research is sponsored by the U.S. Environmental Protection Agency.

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