«Steel, so we will do it with gas and hydrogen to decarbonise the former Ilva»- Corriere.it

From 2026 we will supply two million tons of pre-reduced to Acciaierie d’Italia. And they will be produced using natural gas and at least 10% green hydrogen. Stefano Cao, CEO of Dri d’Italia (where Dri stands for Direct reduced iron, or pre-reduced), is trying to translate the long-announced decarbonisation of the former Ilva (and others) into concrete facts. the company 100% owned by Invitalia (and with president Franco Bernab, also president of Acciaierie d’Italia) delegated by a legislative investiture to build production plants of pre-reduced, the intermediate good used for charging electric furnaces to reduce the production of integrated cycle steel with carbon-coke. The ambitious goal, the aggressive program, the complex process: but we will make it.

Where are we in the decarbonization process?
Dri d’Italia was established in February 2022. We have been indicated as the implementing body of the Pnrr with a loan of 1 billion for the decarbonisation of the Italian steel sector. We completed the feasibility study for the pre-reduced production plant in Taranto in July 2022 and we are now in the executive phase of the project.

When will this first system be ready?
We have defined a tender package to be submitted to the companies interested in building the plant (which are essentially two, Paul Wurth and Danieli, ed) and once the offers have been received by the end of May, we plan to entrust the construction of the plant by July. There is only one important time constraint, that of 2026, so that the loan assigned by the Pnrr, pending disbursement, can be maintained.

Will the pre-reduced production plant be for the exclusive use of Acciaierie d’Italia?
The first plant that will be built will produce pre-reduced for the electric furnaces that will be built by Acciaierie d’Italia which will be available at the same time as our plant, i.e. by 2026. Two million tons of pre-reduced produced using natural gas and at least 10% of green hydrogen that will contribute to decarbonisation.

But natural gas and even more hydrogen, up to 3-4 times, are currently much more expensive than carbon-coke. How do you overcome the cost hurdle?
true, hydrogen is currently much more expensive than coal but there is a very strong desire for its use, so contributions are foreseen in an initial phase, as was the case for renewables, a mechanism that subsidizes production and use of hydrogen. We are moving in the direction of optioning hydrogen by finalizing an agreement with Alboran Hydrogen Brindisi alongside Edison. As for gas, we have built an economic-financial model and we estimate that starting from 2026 the price of gas could return to its historic pre-crisis levels (at 25-26 cents per cubic metre, ed).

The Dri technology process makes it possible to progressively replace natural gas with hydrogen in the plant feed. When will it be possible to think of feeding it only with hydrogen?
Impossible to predict now. Certainly the percentage of 10% of hydrogen in 2026 will grow with the development of technology and with the economy of the use of hydrogen itself.

Dri technology aims to significantly reduce CO2 emissions. How much can you cut carbon dioxide?
In reality, with our system, thanks to the Dri technology, we will halve CO2 emissions and drastically reduce other climate-altering compounds. In perspective, the production of carbon dioxide can also be reduced to zero with the so-called carbon capture projects: we too are evaluating participation in programs that aim to sequester carbon dioxide in depleted gas fields.

Will Dri d’Italia supply pre-reduced production plants only to the former Ilva or also to other steel mills?
The Pnrr provides for a total of 2 billion in investments for the use of hydrogen in industry with a high environmental impact: one destined for Dri d’Italia for the exclusive use of the former Ilva; for the other billion we are evaluating with the Italian electric steelmakers (CEIP), a total of 14 producers, the presentation of a project for a second commercial plant in Taranto.