The iconic images of the steelworkers in the blast furnace will be a thing of the past in a few years. Voestalpine wants to replace all five systems in Linz and Leoben-Donawitz, the first two by 2027. This project alone will cost 1.5 billion euros.
The following figures show the volume of emissions for which the Voestalpine steel mills are responsible: When the first two blast furnaces in Linz and Donawitz are shut down, the CO₂ emissions of the Austrian technology group will fall by 30 percent – and those of Austria as a whole by five percent!
No wonder CEO Herbert Eibensteiner spoke on Wednesday about “Austria’s largest climate protection program”. Voestalpine’s Supervisory Board finally gave the green light to the “Green Tec Steel” project on Tuesday – but the preparatory work has been going on for years.
Start construction next year
What exactly is on the schedule: in the two steel plants in Linz and Leoben-Donawitz, a blast furnace will each be replaced by an electric arc furnace that runs on green electricity. The installation components should be ordered this year, construction should start in 2024 and commissioning should take place in early 2027. “We expect there will be a market for green steel by then,” says Eibensteiner. Incidentally, this steel will be more expensive than the current products.
However, there is still a big question mark: what subsidies can there be for the mega-investment? In Austria, the government has announced a billion dollar “transformation fund” for the transformation of the energy-intensive industry to a green future. According to Eibensteiner, there are talks, but no final financing decision yet. He did not want to answer immediately on Wednesday whether the project would be canceled due to lack of funding.
Green electricity is insured
According to Eibensteiner, the supply of sustainably produced electricity is in any case already assured through supply contracts. And the supply of raw materials is also on schedule: in addition to scrap and molten pig iron, the new process also requires a special form of sponge iron, namely HBI (Hot Briquetted Iron). This is obtained from a factory in Texas (US), in which voestalpine has had a 20 percent interest since last year. There is a multi-year supply contract for 420,000 tonnes of HBI per year.
More blast furnaces will be replaced from 2030
The costs for the new systems in the Linz and Donawitz factories are estimated at 1.5 billion euros. So far “only” one billion euros has been mentioned. Eibensteiner justifies the sharp price increase on the one hand with the general price increase, but on the other hand with the fact that the building, warehouse and energy supply are already being designed for the second step: after 2030, two more blast furnaces at the two locations will be exchanged for electric arc furnaces.
After that, only one blast furnace would remain in Linz. But it must also be closed by 2050 at the latest, closing a major chapter in Austrian industrial history.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
