The demand response potential of a hydrogen-based iron and steel plant

The decarbonisation of the iron and steel industry (ISI) plays an important role in the European ambition to become climate neutral by 2050. The electrification of manufacturing processes and green hydrogen utilisation could, however, put a strain on existing power systems. The aim of this study is to assess the potential of demand response (DR) in decarbonising the ISI. We thereby look at the hydrogen-based direct reduction of iron with electric arc furnace (H2-DRI-EAF), which is currently regarded as the primary technology to decarbonise the industry but it also is the most power intensive low-carbon technology. A linear programming (LP) model is developed to assess the flexibility potential of an exemplary European steel plant that minimises electricity operating costs while maintaining steel production levels. The largest benefits are achieved when increasing the electrolyser size to operate at the times of lowest electricity prices.