Session: 14-01: Sustainable Manufacturing Processes for Low Carbon

Paper Number: 130999

130999 - Decarbonizing the Steel Processing Industry: A MILP-Based Assessment of Electrification and Hydrogen for Hot Rolling 

Abstract: 

The steel processing industry, particularly the hot rolling process, faces major challenges on its way to decarbonization, primarily due to the significant uncertainties associated with current clean alternatives. A key issue arises from the industry's heavy reliance on natural gas, which requires a transition to more sustainable alternatives. The hot rolling process, an essential step in steel production, requires a significant amount of high temperature heat to reheat the steel before rolling. This step is predominantly carried out through the use of natural gas-fired industrial furnaces. Electrification of the process and the use hydrogen have emerged as promising clean alternatives, though neither technology has reached full maturity nor widespread application. It is uncertain which option is the better solution. Effectively transitioning to a new technology necessitates a fundamental redesign of the current system, therefore it is crucial to evaluate various aspects and implications of the technology switch. Future industrial systems must not only focus on optimizing efficiency, but also on adapting to the increasing grid volatilities caused by the growing share of renewable energy sources.

In this paper, we perform an economic and design assessment of two decarbonization scenarios for steel rolling mills. In particular, we evaluate the impact of a highly volatile grid on overall costs and examine how the system responds to grid volatilities. The first scenario involves the electrification of the process by means of induction heating. The second scenario involves the switch to hydrogen including local production. For evaluation, we employ mixed-integer linear programming (MILP) to formulate an optimization problem. The primary objective is to minimize the total annual costs (TAC) while considering the feasibility of the decarbonization pathways. The TAC include mainly investment and operational costs. Our approach begins by examining how the production and demand curves change as a result of the technology switch. We then create linear models for the new components that represent the technical and economic features of the components. Furthermore, we introduce storage units, including battery storage and hydrogen storage, to enhance flexibility. We include electricity price forecasts for Austria in 2050 for a fully renewable grid, capturing grid volatilities and seasonal fluctuations.

Our results reveal that, in general, electrification emerges as the more efficient option. However, it leads to high peak demands, posing a challenge in a highly volatile grid. In the hydrogen scenario, the presence of an electrolysis unit allows for cost fluctuations to be balanced out more effectively. Storage units play a crucial role in the hydrogen scenario, contributing to cost reductions, whereas in the electrification scenario, battery storage does not yield significant cost benefits. Additionally, we examine potential lock-in effects for both technologies and propose stepwise decarbonization pathways that ensure technical feasibility. This study provides important understanding of the economic and design considerations associated with the transition to more sustainable practices in the steel processing industry.

Presenting Author: Gabriela Zabik Vienna University of Technology

Presenting Author Biography: Gabriela Zabik received both her bachelor's and master's degrees in Chemical and Process Engineering from TU Wien, Austria, in 2018 and 2021, respectively. Since 2021, she has been employed as a project assistant at the Institute of Energy Systems and Thermodynamics, TU Wien. Her expertise lies in the operation and design optimization of industrial processes with mathematical programming and her research primarly focuses on transitioning pathways for industrial energy systems.

Authors:

Gabriela Zabik Vienna University of Technology
Felix Birkelbach Vienna University of Technology
René Hofmann Vienna University of Technology