IT USED TO BE POLLUTER PAY
NOW ITS PAY THE POLLUTER
Chris D'Angelo
Mon, March 25, 2024
The Biden administration on Monday announced it will distribute up to $6 billion to curb planet-warming emissions in some of America’s most polluting industries, including chemical, metal and cement operations.
The awards, which the administration called the “largest investment in industrial decarbonization in American history,” are aimed at both advancing the administration’s climate goals and boosting domestic manufacturing.
Energy Secretary Jennifer M. Granholm told reporters the investments target technologies that are scalable and will “set a new gold standard for clear clean manufacturing in the United States and around the world.”
“Put simply, this is good for our planet, it’s good for our economy, it’s good for our workers,” she said.
A total of 33 projects in more than 20 states are slated to receive federal funding, ranging from $20 million to $500 million. The administration expects to leverage an additional $14 billion in private-sector investment.
“These projects offer solutions to slash emissions in some of the highest emitting sectors of our economy, including iron and steel, aluminum, cement, concrete, chemicals, food and beverages, pulp and paper,” Granholm said. “Together, these industries make up roughly a third of our CO2 emissions of our carbon footprint. The projects that we’ve selected promise to make a significant dent in those emissions.”
Together, the 33 projects could eliminate 14 million metric tons of carbon dioxide emissions annually — equivalent to that of 3 million vehicles — and create tens of thousands of jobs, according to the administration.
A Cleveland-Cliffs steel plant in Riverdale, Illinois, is pictured in February 2023. The company was selected to receive federal funds to decarbonize operations at one of its facilities in Middletown, Ohio. Chicago Tribune via Getty Images
In Middletown, Ohio, Cleveland-Cliffs Steel will receive up to $500 million to swap out one of its blast furnaces for two electric furnaces, which is expected to reduce the facility’s greenhouse gas emissions by 1 million tons per year. In Lebec, California, the National Cement Co. of California will put $500 million in federal funds toward the production of carbon-neutral cement using biomass from agricultural byproducts like pistachio shells. And in Mansfield, Louisiana, the International Paper Co. will receive $46 million to use a new chemical separation technology to reduce emissions during pulp production.
During the application process, the Department of Energy received a total 411 concept papers requesting more than $60 billion in federal funds for energy efficiency projects, according to a senior Biden administration official. The $6 billion that’s being distributed includes $5.47 billion from the 2022 Inflation Reduction Act and $489 million from the 2021 bipartisan infrastructure law.
Ali Zaidi, the White House national climate adviser, told reporters that the investments are a “massive deal” not only in the fight against climate change, but for environmental justice, noting that 79% of the projects are in disadvantaged communities.
“This is part of a government-wide strategy that looks at the industrial sector — the president often says, ‘When I think of climate, I see jobs’ — and sees both the climate opportunity and the massive jobs opportunity,” Zaidi told reporters. “Today’s historic announcement is a big step in that direction, both here for the United States of America but, frankly, for everybody around the world chasing a better future.”
US pledges up to $1B for two pioneering 'green steel' projects
Maria Gallucci
Tue, March 26, 2024
The Biden administration’s latest initiative to clean up heavy industries could usher in a new era for one of the dirtiest sectors of all: iron and steel.
On Monday, the U.S. Department of Energy announced up to $6 billion for commercial-scale projects that aim to demonstrate technologies for slashing greenhouse gas emissions at an array of U.S. factories. Two of the winners — the steelmakers Cleveland-Cliffs and SSAB — were each selected to receive up to $500 million for “green steel” projects that could transform how America turns iron ore into the ubiquitous high-strength metal.
Both companies are proposing to build low-emissions ironmaking facilities that run on clean hydrogen instead of coal or fossil gas. No such facilities exist yet in the United States, and only one worldwide is operating at a meaningful scale today: the Hybrit project in Sweden, in which SSAB is a partner. Before this week’s announcement, the only other hydrogen-focused projects in the works were based in Europe and China.
“Until a few days ago, it was feeling like the U.S. was really behind, and that we needed to be making some leadership investments in our first green steel plants,” Hilary Lewis, steel director at the advocacy group Industrious Labs, told Canary Media. “And that’s what we got today.”
Cleveland-Cliffs plans to install a “hydrogen-ready” ironmaking plant at an existing complex in Middletown, Ohio. SSAB would build a new facility in Perry County, Mississippi that exclusively uses hydrogen to turn raw ore into iron.
The manufacturers will each have to contribute their own sizable share of funding, and both projects are still subject to award negotiations. But green-steel proponents say government support is crucial to getting these first-of-a-kind facilities financed, given that banks and investors are generally reluctant to back potentially risky, capital-intensive projects.
Still, building less-polluting infrastructure is only the first step. In order to drive deep emissions cuts, companies using this ironmaking technique will also have to procure large quantities of “clean hydrogen” in particular — very little of which is available right now. Today, the vast majority of hydrogen is produced using fossil gas in an emissions-intensive process. The lowest-carbon alternative is to make hydrogen with water and huge amounts of renewable electricity; this is also called “green hydrogen.”
In that way, the quest for greener steel is bound up in the success of two broader efforts taking shape across the United States: dramatically boosting the production of clean hydrogen and drastically scaling up the nation’s clean energy capacity.
Striving toward cleaner steel
Globally, steel production generates as much as 9 percent of human-caused CO2 emissions every year — more than any other heavy industry.
Part of the reason is simply that manufacturers make so much of it: nearly 2 billion metric tons per year worldwide. The essential alloy forms the hulls of cargo ships and parts of airplanes. It’s found in buildings, bridges and roads, and it’s used in vehicles, appliances and cookware.
In recent years, the U.S. steel industry has made strides to curb its carbon footprint by increasing the amount of recycled steel used in end products, and then melting all of that scrap metal in electric-powered arc furnaces. Today, about 70 percent of America’s steel is made this way, while roughly 30 percent is produced in traditional coal-hungry mills. (Worldwide, the story plays out in reverse.)
But while recycled steel can satisfy some of the nation’s demand for the sturdy metal, it doesn’t fully replace the need for “primary” steel, which is essential for the high-strength components in vehicles. It also doesn’t diminish the need to clean up or replace the dirty facilities that still exist.
Right now, most primary steel is made using a blast furnace — by far the biggest emissions culprit — in what are known as integrated steel mills.
In blast furnaces, iron ore and purified coal (or “coke”) are dumped into a vessel, along with a sprinkling of processed limestone. A blast of hot air reaching up to around 2,800°F is blown into the furnace at high speeds, driving chemical reactions. Carbon monoxide bonds with oxygen atoms in the iron ore, forming CO2 that’s released into the air. The resulting iron flows out of the furnace like lava; from there, it moves into a basic oxygen furnace to become finished steel.
The United States still operates 13 aging blast furnaces, seven of which are owned by Ohio-based Cleveland-Cliffs.
This week, the manufacturer said it plans to replace one of those blast furnaces in Middletown, Ohio with a “direct reduced iron” plant that can run on hydrogen. Cleveland-Cliffs anticipates it will spend around $1.3 billion itself over a five-year period for the project, which could be completed by 2029.
The direct reduced iron (DRI) process involves dropping iron-ore pellets into a shaft furnace. The combination of hydrogen gas and heat causes the oxygen atoms in iron ore to combine with hydrogen and form water. DRI plants can be paired with electric arc furnaces to turn iron into finished steel using only electricity. But in the case of Cleveland-Cliffs, the company is building two electricity-powered melting furnaces that will feed the iron into its existing basic oxygen furnace.
The investments are expected to slash emissions at the Ohio facility by 1 million metric tons of greenhouse gases every year, according to the DOE.
“Hydrogen is the real game-changing event in ironmaking and steelmaking, and that’s our Cleveland-Cliffs pathway to the production of green steel,” Lourenco Goncalves, the company’s CEO and chairman, said on a January 30 earnings call.
DRI technology is decades old, and nearly 100 such facilities have been deployed worldwide to date — including three in the United States. But all of them use fossil fuels in the shaft furnace. Rather than using hydrogen directly, these facilities take fossil gas or coke-oven gas to produce a “reducing gas,” containing hydrogen and carbon monoxide, that removes the oxygen content from iron ore.
Cleveland-Cliffs said its new DRI facility in Middletown will have the “flexibility” to be fueled by fossil gas, which would reduce the carbon-intensity from ironmaking by more than half. The plant can also run on a mix of gas and clean hydrogen, or on clean hydrogen alone. The latter option would reduce the carbon-intensity of making iron by over 90 percent.
Meanwhile, the other big winner this week, SSAB, said it’s planning to skip gas altogether and go straight to using clean hydrogen in Mississippi.
The Swedish manufacturer was selected to build the world’s first commercial-scale facility using Hybrit technology, though it didn’t say by when. The existing Hybrit pilot plant in Sweden uses hydrogen to produce direct reduced iron. But unlike other DRI facilities, Hybrit has a proprietary design — one its developers say is optimized to run on only hydrogen, instead of fossil gas or a mix of fuels.
SSAB is also considering expanding its existing steelmaking facility in Montpelier, Iowa to make use of new clean iron supplies from its Mississippi plant. As part of the initiative, SSAB said it signed a letter of intent for Hy Stor Energy to supply green hydrogen and renewable energy in Mississippi. Hy Stor is developing a hydrogen “hub” in that state, where it plans to use on-site, off-grid renewable energy projects to produce hydrogen, which is then stored in underground salt caverns to deliver energy on-demand and around the clock.
Hilary Lewis said that, in light of this week’s news, “Green hydrogen developers should have their ears perked up and be reaching out to make sure that their projects are the ones supported by this huge new demand.”
Industrious Labs and other green-steel proponents will “be working on that as well, to make sure that they get the cleanest possible hydrogen for those facilities,” she added.
The 'clean cement' projects getting $1.5B in Biden admin funds
Jeff St. John
Wed, March 27, 2024
Cement-making accounts for roughly 8 percent of global human-caused carbon emissions — an enormous climate footprint that will take nothing short of a full transformation to curb.
This week, the U.S. cement industry got a big jolt of federal funding to help it along that path. On Monday, the Biden administration announced $6 billion in investment for 33 demonstration projects aimed at decarbonizing heavy industrial sectors. Among them, six projects set to receive a collective $1.5 billion are seeking to slash the carbon impact of cement — and each project is going about it in a different way.
That’s because cement — the gluey powder that’s mixed with sand, gravel and water to form concrete, the most widely used material on earth — represents a particularly complex emissions problem that no one technology on its own can solve.
About 40 percent of the industry’s emissions come from burning fossil fuels in kilns used to make cement. Scaling up cost-effective alternatives to reach the super-hot temperatures required is challenging in its own right, particularly for an industry that churns out more than 4 billion metric tons of product per year.
But the other 60 percent of emissions from cement-making come from the chemical process of breaking down limestone, the core precursor material for almost all cement made today, into its constituent parts of calcium oxide and CO2. That process can’t be decarbonized simply by switching fuels.
The U.S. Department of Energy — the source of this week’s industrial decarbonization grants — estimated in a report last year that roughly one-third of the cement industry’s emissions can be eliminated using established technologies and processes by the early 2030s. Major cement-makers in the U.S. and around the world are already using these approaches, which the DOE also estimates will actually help the industry save around $1 billion per year.
But the remaining two-thirds of cement’s emissions will be harder and more expensive to reduce, the DOE wrote in its report, requiring investments of a cumulative $5 billion to $20 billion by 2030 and between $60 billion and $120 billion by midcentury. For an industry that made just under $15 billion in sales last year and competes on very tight margins, that’s a hefty burden.
Eliminating that share of cement emissions will require alternative materials, alternative chemistries, alternative processing methods, or capturing and sequestering the carbon dioxide before it reaches the atmosphere — all viable pathways that face their own unique challenges.
That’s why government backing like that announced this week — which will be matched by equal or larger investments from the companies that won the awards — is vital to getting first-of-a-kind cement decarbonization projects off the ground.
Here’s a breakdown of the projects that won awards and the particular technology pathways they’re exploring.
Making ordinary Portland cement from different kinds of rocks
Nearly all the cement made today is Portland cement, a material invented in 1824 that relies on carbon-rich limestone as a key ingredient. But what if cement could be made from minerals that aren’t packed full of carbon that escapes into the atmosphere?
That’s the goal of Brimstone, an Oakland, California–based startup that’s developing a way to convert calcium-bearing silicate rocks into Portland cement. These rocks are rich in the key cement-making ingredient of calcium oxide but free of carbon atoms.
Brimstone was approved for a DOE grant of up to $189 million to build its first-of-a-kind commercial-scale demonstration plant for its technology. That plant will be capable of producing 140,000 metric tons per year of this carbon-free Portland cement, along with supplementary cementing materials — alternatives to clinker, the precursor material for cement, that can bulk up a cement mix — that will avoid more than 120,000 metric tons of carbon dioxide emissions per year compared to standard Portland cement production.
Last year, Brimstone earned third-party certification verifying that its Portland cement is structurally and chemically identical to conventional supplies — an important finding for companies leery of replacing tried-and-true cement mixes with novel formulas.
But in an industry like cement, where almost all new facilities are financed by existing producers, “obtaining capital for a first-of-a-kind commercial-scale plant is challenging,” Cody Finke, Brimstone's co-founder and CEO, said in an email. The new DOE funding “greatly accelerates the path to market for our deeply decarbonized cement,” allowing the company to start building its first pilot plant in 2025 while it starts to plan and design its first commercial-scale plant in 2027 or 2028.
Making cement from electricity
Getting the carbon out of the minerals going into cement kilns is one way to cut carbon. Another way is to switch out fossil-fuel-burning cement kilns with a process that uses electricity to do the same work.
That’s the goal of Sublime Systems, an MIT spinout that’s developed an electrolytic technology similar to those used to produce clean hydrogen to make cement in a way that doesn’t emit carbon and runs at close to room temperature. Sublime’s electrolyzer uses electricity to extract calcium from calcium silicate materials and then precipitate that calcium in a form that can be used to make its final cement product.
Sublime has also earned an industry designation finding its product meets certain performance-based standards for hydraulic cement, and in late 2022, it finished a pilot plant that can produce up to 100 metric tons of cement per year. Its new DOE grant of up to $87 million will fund its first commercial-scale plant in Holyoke, Massachusetts, capable of producing tens of thousands of tons of its cement per year.
“Access to sufficient capital for industrial-scale demonstrations is the single biggest obstacle preventing breakthrough innovations from reaching the scale humanity needs to combat the climate crisis,” Sublime CEO and co-founder Leah Ellis said in a statement. “The Department of Energy has cleared this obstacle.” The company plans to begin construction of its Holyoke plant in 2025 and start producing cement in 2026.
Using clays to lower the carbon footprint of cement
Supplementary cementing materials (SCMs) that reduce the proportion of high-emissions clinker needed in cement mixes are the chief ingredient in the lower-carbon cement blends now available around the world. But the most commonly used SCMs today are fly ash from coal plants and slag from steel mills — two materials that are limited in supply, expensive to transport and expected to decrease in availability as the power and steel sectors decarbonize.
Calcined clays, a form of naturally occurring minerals, are a promising alternative SCM already used by major cement producers such as Heidelberg Materials, Holcim and Hoffmann Green Cement Technologies to reduce up to half of the clinker in certain cement blends. So-called LC3 (limestone calcined clay cement) can be produced with emissions up to 40 percent lower than Portland cement.
The challenge for introducing LC3 into new markets and for new uses is in testing the strength, durability and suitability of new mixes made from distinct sources of calcined clays available in different parts of the world. Two of the projects funded by DOE’s newly announced grants are aimed at expanding the scope of these cements in parts of the country where they aren’t yet in wide use.
Roanoke Cement Company in Troutville, Virginia was awarded up to $61.7 million to use locally available clay types to reduce carbon emissions and establish markets for LC3 cement in its region. And Summit Materials was awarded up to $215.6 million to build “calcination” facilities in Maryland, Georgia and Texas, with the goal of reducing 1.1 million metric tons of CO2 emissions per year.
Carbon capture and multitechnology approaches
Alternative chemistries, alternative cement-making methods and new sources of supplementary cementing materials are all valuable options for cutting cement’s carbon footprint. But even if they can compete on cost with standard Portland cement, it’s likely that construction-industry buyers will be slow to purchase them instead of old-fashioned Portland cement. The DOE suggests these alternatives could “face a ~10–20+ year adoption cycle to be accepted under widely used industry standards.”
The planet doesn’t have that long to wait to decarbonize cement production, however — and that’s focused many of the industry’s biggest players and government programs on carbon capture, utilization and sequestration (CCUS) as a vital near-term path. DOE’s Liftoff report cites industry and research studies indicating that CCUS could account for more than half of the industry’s potential to reduce carbon emissions by midcentury — if it can cost-effectively scale up to match the industry’s enormous emissions challenge.
CCUS is the focus of the two largest DOE grants for cement decarbonization projects, each up to $500 million. The first is for Heidelberg Materials, which is planning to capture at least 95 percent of the carbon dioxide — quite a high capture rate for today’s technologies — from its newly retrofitted plant in Mitchell, Indiana, one of the country’s largest cement production sites.
If successful, it would capture 2 million tons of CO2 per year from the plant and store it in geologic formations beneath the plant property.
One of the biggest challenges of CCUS is building the pipelines and wells needed to sequester carbon dioxide deep underground where it can’t escape back into the atmosphere. The biggest U.S. cement CCUS projects, such as the Mitchell plant and two projects with Holcim at plants in Florence, Colorado and Bloomsdale, Missouri, are conveniently nearby underground geological formations that could house large amounts of captured CO2 for centuries. These and other carbon-sequestration plans still face years of work to determine that they’re safe and to secure permits to undertake that work.
The second award of up to $500 million is for the National Cement Company of California, which is taking up a multitechnology approach to its goal of producing “carbon-neutral cement” at its plant in Lebec, California. That project will implement CCUS, and it will also use calcined clay to produce lower-carbon LC3 cement. It will also replace fossil fuels for its kilns with locally sourced agricultural waste such as pistachio shells, which embed the carbon dioxide that trees have previously absorbed from the atmosphere.
None of these awards are final yet — each project must go through contract negotiations, and the companies involved must commit to supplying an equal or greater amount of matching funds. Designing and building each project could take years. And each will need to secure commitments from buyers willing to use the cement it produces.
But if successful, these projects could help provide a blueprint for building a future with much lower-carbon cement — or even “net-negative” cement, as DOE’s announcement describes its longer-term vision.
Why Biden is spending $6 billion on green concrete and whiskey
Tim McDonnell
Wed, March 27, 2024
The News
The U.S. Department of Energy announced this week it will dole out $6 billion in grants to cut emissions from three dozen factories across a wide range of industries — including steel, cement, aluminum, even whiskey and pasta. The Biden administration’s climate strategy up to now has focused primarily on cutting emissions from the power and transportation sectors, particularly via wind and solar energy and electric vehicles. The new funding targets heavy industry, which accounts for one-third of the country’s carbon footprint but has seen much slower progress on decarbonization because the technologies involved are mostly new and have rarely been tried at commercial scale.
The combined emissions savings from all 33 projects would be equivalent to taking three million gas-fueled cars off the road, Kelly Cummins, acting director for the DOE’s Office of Clean Energy Demonstrations, told Semafor. And if all goes according to plan, that’s just a down payment on bigger cuts in the future.
“We want to make sure these are not just one-off projects,” she said. “The only way we’re going to meet our long-term climate goals is if we get replication from these demonstration projects.”
Tim’s view
It may be time to retire a climate cliché: Emissions from the sectors targeted in this program are sometimes called “hard to abate,” because many industrial processes require high temperatures from burning coal and natural gas that aren’t easily replaced by low-carbon electricity. But research and innovation over the past few years have delivered a range of technological solutions for high-carbon industries. Now, the biggest obstacle is getting factory owners, their customers, and their financiers to take a gamble on bringing those from the lab to commercial scale. The new round of DOE funding is meant to lower the stakes.
Of the roughly $811 billion invested by the private sector in climate tech since 2018, only about 5% has gone to low-carbon industrial processes, according to BloombergNEF data. Electric vehicles, by comparison, have captured 30%. For each of the projects in the DOE program, federal funding can supply no more than half of the total investment required, and in most cases much less than that, Cummins said. She expects the DOE’s $6 billion to draw in at least another $14 billion from private investors, with more to follow if the proof-of-concept works.
“We prefer ‘yet to abate’ now instead of ‘hard to abate’,” said Bryan Fisher, managing director for climate-aligned industries at the nonprofit Rocky Mountain Institute. “All of these are near-proven technologies that just need to be demonstrated in a commercial environment. Somebody just has to do the first one, so we can get the second and third ones.”
Projects in the program include replacing coal-burning blast furnaces at an Ohio steel plant with alternatives that run on hydrogen and electricity, a super-efficient aluminum smelter that will be the first such smelter built in the U.S. in 45 years, and a gas-electric hybrid glass furnace in California to churn out low-carbon wine bottles. Some of the grants will benefit startups working on their first-ever commercial-scale facility. Others will benefit big incumbent emitters trying to clean up, including an ExxonMobil petrochemical refinery in Texas, a steel plant run by Sweden’s SSAB, one of the world’s largest steelmakers, and an effort by beverage giant Diageo to replace gas-fired boilers used in the production of Bulleit whiskey with electric ones. Big companies like Exxon may not be obvious candidates for federal climate funding, but they have the balance sheet and technical expertise to put a major dent in emissions if they can be convinced to opt for a lower-carbon alternative, Fisher said.
To actually get a check from DOE, all of these projects have to clear a few more rounds of due diligence, including proving they’ll create local jobs and that they have at least a few early customers lined up that are willing to pay a bit more for green products. Most likely, not all of these projects will pan out. But if even a few do, the return on investment — in terms of emissions reduced per taxpayer dollar invested — would be huge.
Room for Disagreement
DOE’s domino-effect thesis — that getting a first round of projects over the financing hump will tip off a wave of private investment — is far from a surefire bet. Many of the projects here will rely on a steady supply of low-carbon hydrogen, which is practically nonexistent today. There are familiar challenges around infrastructure permitting, as well as offtake contracts: It doesn’t matter if the technology works if customers aren’t willing to pay for it. And all of this is playing out against the rapidly ticking clock of climate change. “Trying to grow infant industries is a complex, multi-decade process,” said Todd Tucker, director of industrial policy at the Roosevelt Institute. “It’s not for people who want quick results.”
The View From Oakland
One of the program’s beneficiaries is Cody Finke, whose startup Brimstone was awarded $189 million to build its first commercial-scale plant producing low-carbon cement using a proprietary chemical process. The company pieced together its early investment from smaller DOE sources and venture funders, Finke said, but the commercial facility was too expensive for its main backers. “Banks don’t have a financing product that takes that much risk, and VCs don’t have a product that’s the right size,” he said. The larger DOE grant makes it much easier to draw in a broader pool of investors, he said, and brings the company closer to making a product that can compete directly with traditional cement on cost. “There are lots of technological solutions to climate change, but few actually will give someone enough profit to make it happen,” he said. “That is really the gating thing.”
Notable
Several of the largest grants in the program will go to companies headquartered in Europe, adding a new wrinkle to the climate tech tug-of-war between the U.S. and European Union.
Chris D'Angelo
Mon, March 25, 2024
The Biden administration on Monday announced it will distribute up to $6 billion to curb planet-warming emissions in some of America’s most polluting industries, including chemical, metal and cement operations.
The awards, which the administration called the “largest investment in industrial decarbonization in American history,” are aimed at both advancing the administration’s climate goals and boosting domestic manufacturing.
Energy Secretary Jennifer M. Granholm told reporters the investments target technologies that are scalable and will “set a new gold standard for clear clean manufacturing in the United States and around the world.”
“Put simply, this is good for our planet, it’s good for our economy, it’s good for our workers,” she said.
A total of 33 projects in more than 20 states are slated to receive federal funding, ranging from $20 million to $500 million. The administration expects to leverage an additional $14 billion in private-sector investment.
“These projects offer solutions to slash emissions in some of the highest emitting sectors of our economy, including iron and steel, aluminum, cement, concrete, chemicals, food and beverages, pulp and paper,” Granholm said. “Together, these industries make up roughly a third of our CO2 emissions of our carbon footprint. The projects that we’ve selected promise to make a significant dent in those emissions.”
Together, the 33 projects could eliminate 14 million metric tons of carbon dioxide emissions annually — equivalent to that of 3 million vehicles — and create tens of thousands of jobs, according to the administration.
A Cleveland-Cliffs steel plant in Riverdale, Illinois, is pictured in February 2023. The company was selected to receive federal funds to decarbonize operations at one of its facilities in Middletown, Ohio. Chicago Tribune via Getty Images
In Middletown, Ohio, Cleveland-Cliffs Steel will receive up to $500 million to swap out one of its blast furnaces for two electric furnaces, which is expected to reduce the facility’s greenhouse gas emissions by 1 million tons per year. In Lebec, California, the National Cement Co. of California will put $500 million in federal funds toward the production of carbon-neutral cement using biomass from agricultural byproducts like pistachio shells. And in Mansfield, Louisiana, the International Paper Co. will receive $46 million to use a new chemical separation technology to reduce emissions during pulp production.
During the application process, the Department of Energy received a total 411 concept papers requesting more than $60 billion in federal funds for energy efficiency projects, according to a senior Biden administration official. The $6 billion that’s being distributed includes $5.47 billion from the 2022 Inflation Reduction Act and $489 million from the 2021 bipartisan infrastructure law.
Ali Zaidi, the White House national climate adviser, told reporters that the investments are a “massive deal” not only in the fight against climate change, but for environmental justice, noting that 79% of the projects are in disadvantaged communities.
“This is part of a government-wide strategy that looks at the industrial sector — the president often says, ‘When I think of climate, I see jobs’ — and sees both the climate opportunity and the massive jobs opportunity,” Zaidi told reporters. “Today’s historic announcement is a big step in that direction, both here for the United States of America but, frankly, for everybody around the world chasing a better future.”
US pledges up to $1B for two pioneering 'green steel' projects
Maria Gallucci
Tue, March 26, 2024
The Biden administration’s latest initiative to clean up heavy industries could usher in a new era for one of the dirtiest sectors of all: iron and steel.
On Monday, the U.S. Department of Energy announced up to $6 billion for commercial-scale projects that aim to demonstrate technologies for slashing greenhouse gas emissions at an array of U.S. factories. Two of the winners — the steelmakers Cleveland-Cliffs and SSAB — were each selected to receive up to $500 million for “green steel” projects that could transform how America turns iron ore into the ubiquitous high-strength metal.
Both companies are proposing to build low-emissions ironmaking facilities that run on clean hydrogen instead of coal or fossil gas. No such facilities exist yet in the United States, and only one worldwide is operating at a meaningful scale today: the Hybrit project in Sweden, in which SSAB is a partner. Before this week’s announcement, the only other hydrogen-focused projects in the works were based in Europe and China.
“Until a few days ago, it was feeling like the U.S. was really behind, and that we needed to be making some leadership investments in our first green steel plants,” Hilary Lewis, steel director at the advocacy group Industrious Labs, told Canary Media. “And that’s what we got today.”
Cleveland-Cliffs plans to install a “hydrogen-ready” ironmaking plant at an existing complex in Middletown, Ohio. SSAB would build a new facility in Perry County, Mississippi that exclusively uses hydrogen to turn raw ore into iron.
The manufacturers will each have to contribute their own sizable share of funding, and both projects are still subject to award negotiations. But green-steel proponents say government support is crucial to getting these first-of-a-kind facilities financed, given that banks and investors are generally reluctant to back potentially risky, capital-intensive projects.
Still, building less-polluting infrastructure is only the first step. In order to drive deep emissions cuts, companies using this ironmaking technique will also have to procure large quantities of “clean hydrogen” in particular — very little of which is available right now. Today, the vast majority of hydrogen is produced using fossil gas in an emissions-intensive process. The lowest-carbon alternative is to make hydrogen with water and huge amounts of renewable electricity; this is also called “green hydrogen.”
In that way, the quest for greener steel is bound up in the success of two broader efforts taking shape across the United States: dramatically boosting the production of clean hydrogen and drastically scaling up the nation’s clean energy capacity.
Striving toward cleaner steel
Globally, steel production generates as much as 9 percent of human-caused CO2 emissions every year — more than any other heavy industry.
Part of the reason is simply that manufacturers make so much of it: nearly 2 billion metric tons per year worldwide. The essential alloy forms the hulls of cargo ships and parts of airplanes. It’s found in buildings, bridges and roads, and it’s used in vehicles, appliances and cookware.
In recent years, the U.S. steel industry has made strides to curb its carbon footprint by increasing the amount of recycled steel used in end products, and then melting all of that scrap metal in electric-powered arc furnaces. Today, about 70 percent of America’s steel is made this way, while roughly 30 percent is produced in traditional coal-hungry mills. (Worldwide, the story plays out in reverse.)
But while recycled steel can satisfy some of the nation’s demand for the sturdy metal, it doesn’t fully replace the need for “primary” steel, which is essential for the high-strength components in vehicles. It also doesn’t diminish the need to clean up or replace the dirty facilities that still exist.
Right now, most primary steel is made using a blast furnace — by far the biggest emissions culprit — in what are known as integrated steel mills.
In blast furnaces, iron ore and purified coal (or “coke”) are dumped into a vessel, along with a sprinkling of processed limestone. A blast of hot air reaching up to around 2,800°F is blown into the furnace at high speeds, driving chemical reactions. Carbon monoxide bonds with oxygen atoms in the iron ore, forming CO2 that’s released into the air. The resulting iron flows out of the furnace like lava; from there, it moves into a basic oxygen furnace to become finished steel.
The United States still operates 13 aging blast furnaces, seven of which are owned by Ohio-based Cleveland-Cliffs.
This week, the manufacturer said it plans to replace one of those blast furnaces in Middletown, Ohio with a “direct reduced iron” plant that can run on hydrogen. Cleveland-Cliffs anticipates it will spend around $1.3 billion itself over a five-year period for the project, which could be completed by 2029.
The direct reduced iron (DRI) process involves dropping iron-ore pellets into a shaft furnace. The combination of hydrogen gas and heat causes the oxygen atoms in iron ore to combine with hydrogen and form water. DRI plants can be paired with electric arc furnaces to turn iron into finished steel using only electricity. But in the case of Cleveland-Cliffs, the company is building two electricity-powered melting furnaces that will feed the iron into its existing basic oxygen furnace.
The investments are expected to slash emissions at the Ohio facility by 1 million metric tons of greenhouse gases every year, according to the DOE.
“Hydrogen is the real game-changing event in ironmaking and steelmaking, and that’s our Cleveland-Cliffs pathway to the production of green steel,” Lourenco Goncalves, the company’s CEO and chairman, said on a January 30 earnings call.
DRI technology is decades old, and nearly 100 such facilities have been deployed worldwide to date — including three in the United States. But all of them use fossil fuels in the shaft furnace. Rather than using hydrogen directly, these facilities take fossil gas or coke-oven gas to produce a “reducing gas,” containing hydrogen and carbon monoxide, that removes the oxygen content from iron ore.
Cleveland-Cliffs said its new DRI facility in Middletown will have the “flexibility” to be fueled by fossil gas, which would reduce the carbon-intensity from ironmaking by more than half. The plant can also run on a mix of gas and clean hydrogen, or on clean hydrogen alone. The latter option would reduce the carbon-intensity of making iron by over 90 percent.
Meanwhile, the other big winner this week, SSAB, said it’s planning to skip gas altogether and go straight to using clean hydrogen in Mississippi.
The Swedish manufacturer was selected to build the world’s first commercial-scale facility using Hybrit technology, though it didn’t say by when. The existing Hybrit pilot plant in Sweden uses hydrogen to produce direct reduced iron. But unlike other DRI facilities, Hybrit has a proprietary design — one its developers say is optimized to run on only hydrogen, instead of fossil gas or a mix of fuels.
SSAB is also considering expanding its existing steelmaking facility in Montpelier, Iowa to make use of new clean iron supplies from its Mississippi plant. As part of the initiative, SSAB said it signed a letter of intent for Hy Stor Energy to supply green hydrogen and renewable energy in Mississippi. Hy Stor is developing a hydrogen “hub” in that state, where it plans to use on-site, off-grid renewable energy projects to produce hydrogen, which is then stored in underground salt caverns to deliver energy on-demand and around the clock.
Hilary Lewis said that, in light of this week’s news, “Green hydrogen developers should have their ears perked up and be reaching out to make sure that their projects are the ones supported by this huge new demand.”
Industrious Labs and other green-steel proponents will “be working on that as well, to make sure that they get the cleanest possible hydrogen for those facilities,” she added.
The 'clean cement' projects getting $1.5B in Biden admin funds
Jeff St. John
Wed, March 27, 2024
Cement-making accounts for roughly 8 percent of global human-caused carbon emissions — an enormous climate footprint that will take nothing short of a full transformation to curb.
This week, the U.S. cement industry got a big jolt of federal funding to help it along that path. On Monday, the Biden administration announced $6 billion in investment for 33 demonstration projects aimed at decarbonizing heavy industrial sectors. Among them, six projects set to receive a collective $1.5 billion are seeking to slash the carbon impact of cement — and each project is going about it in a different way.
That’s because cement — the gluey powder that’s mixed with sand, gravel and water to form concrete, the most widely used material on earth — represents a particularly complex emissions problem that no one technology on its own can solve.
About 40 percent of the industry’s emissions come from burning fossil fuels in kilns used to make cement. Scaling up cost-effective alternatives to reach the super-hot temperatures required is challenging in its own right, particularly for an industry that churns out more than 4 billion metric tons of product per year.
But the other 60 percent of emissions from cement-making come from the chemical process of breaking down limestone, the core precursor material for almost all cement made today, into its constituent parts of calcium oxide and CO2. That process can’t be decarbonized simply by switching fuels.
The U.S. Department of Energy — the source of this week’s industrial decarbonization grants — estimated in a report last year that roughly one-third of the cement industry’s emissions can be eliminated using established technologies and processes by the early 2030s. Major cement-makers in the U.S. and around the world are already using these approaches, which the DOE also estimates will actually help the industry save around $1 billion per year.
But the remaining two-thirds of cement’s emissions will be harder and more expensive to reduce, the DOE wrote in its report, requiring investments of a cumulative $5 billion to $20 billion by 2030 and between $60 billion and $120 billion by midcentury. For an industry that made just under $15 billion in sales last year and competes on very tight margins, that’s a hefty burden.
Eliminating that share of cement emissions will require alternative materials, alternative chemistries, alternative processing methods, or capturing and sequestering the carbon dioxide before it reaches the atmosphere — all viable pathways that face their own unique challenges.
That’s why government backing like that announced this week — which will be matched by equal or larger investments from the companies that won the awards — is vital to getting first-of-a-kind cement decarbonization projects off the ground.
Here’s a breakdown of the projects that won awards and the particular technology pathways they’re exploring.
Making ordinary Portland cement from different kinds of rocks
Nearly all the cement made today is Portland cement, a material invented in 1824 that relies on carbon-rich limestone as a key ingredient. But what if cement could be made from minerals that aren’t packed full of carbon that escapes into the atmosphere?
That’s the goal of Brimstone, an Oakland, California–based startup that’s developing a way to convert calcium-bearing silicate rocks into Portland cement. These rocks are rich in the key cement-making ingredient of calcium oxide but free of carbon atoms.
Brimstone was approved for a DOE grant of up to $189 million to build its first-of-a-kind commercial-scale demonstration plant for its technology. That plant will be capable of producing 140,000 metric tons per year of this carbon-free Portland cement, along with supplementary cementing materials — alternatives to clinker, the precursor material for cement, that can bulk up a cement mix — that will avoid more than 120,000 metric tons of carbon dioxide emissions per year compared to standard Portland cement production.
Last year, Brimstone earned third-party certification verifying that its Portland cement is structurally and chemically identical to conventional supplies — an important finding for companies leery of replacing tried-and-true cement mixes with novel formulas.
But in an industry like cement, where almost all new facilities are financed by existing producers, “obtaining capital for a first-of-a-kind commercial-scale plant is challenging,” Cody Finke, Brimstone's co-founder and CEO, said in an email. The new DOE funding “greatly accelerates the path to market for our deeply decarbonized cement,” allowing the company to start building its first pilot plant in 2025 while it starts to plan and design its first commercial-scale plant in 2027 or 2028.
Making cement from electricity
Getting the carbon out of the minerals going into cement kilns is one way to cut carbon. Another way is to switch out fossil-fuel-burning cement kilns with a process that uses electricity to do the same work.
That’s the goal of Sublime Systems, an MIT spinout that’s developed an electrolytic technology similar to those used to produce clean hydrogen to make cement in a way that doesn’t emit carbon and runs at close to room temperature. Sublime’s electrolyzer uses electricity to extract calcium from calcium silicate materials and then precipitate that calcium in a form that can be used to make its final cement product.
Sublime has also earned an industry designation finding its product meets certain performance-based standards for hydraulic cement, and in late 2022, it finished a pilot plant that can produce up to 100 metric tons of cement per year. Its new DOE grant of up to $87 million will fund its first commercial-scale plant in Holyoke, Massachusetts, capable of producing tens of thousands of tons of its cement per year.
“Access to sufficient capital for industrial-scale demonstrations is the single biggest obstacle preventing breakthrough innovations from reaching the scale humanity needs to combat the climate crisis,” Sublime CEO and co-founder Leah Ellis said in a statement. “The Department of Energy has cleared this obstacle.” The company plans to begin construction of its Holyoke plant in 2025 and start producing cement in 2026.
Using clays to lower the carbon footprint of cement
Supplementary cementing materials (SCMs) that reduce the proportion of high-emissions clinker needed in cement mixes are the chief ingredient in the lower-carbon cement blends now available around the world. But the most commonly used SCMs today are fly ash from coal plants and slag from steel mills — two materials that are limited in supply, expensive to transport and expected to decrease in availability as the power and steel sectors decarbonize.
Calcined clays, a form of naturally occurring minerals, are a promising alternative SCM already used by major cement producers such as Heidelberg Materials, Holcim and Hoffmann Green Cement Technologies to reduce up to half of the clinker in certain cement blends. So-called LC3 (limestone calcined clay cement) can be produced with emissions up to 40 percent lower than Portland cement.
The challenge for introducing LC3 into new markets and for new uses is in testing the strength, durability and suitability of new mixes made from distinct sources of calcined clays available in different parts of the world. Two of the projects funded by DOE’s newly announced grants are aimed at expanding the scope of these cements in parts of the country where they aren’t yet in wide use.
Roanoke Cement Company in Troutville, Virginia was awarded up to $61.7 million to use locally available clay types to reduce carbon emissions and establish markets for LC3 cement in its region. And Summit Materials was awarded up to $215.6 million to build “calcination” facilities in Maryland, Georgia and Texas, with the goal of reducing 1.1 million metric tons of CO2 emissions per year.
Carbon capture and multitechnology approaches
Alternative chemistries, alternative cement-making methods and new sources of supplementary cementing materials are all valuable options for cutting cement’s carbon footprint. But even if they can compete on cost with standard Portland cement, it’s likely that construction-industry buyers will be slow to purchase them instead of old-fashioned Portland cement. The DOE suggests these alternatives could “face a ~10–20+ year adoption cycle to be accepted under widely used industry standards.”
The planet doesn’t have that long to wait to decarbonize cement production, however — and that’s focused many of the industry’s biggest players and government programs on carbon capture, utilization and sequestration (CCUS) as a vital near-term path. DOE’s Liftoff report cites industry and research studies indicating that CCUS could account for more than half of the industry’s potential to reduce carbon emissions by midcentury — if it can cost-effectively scale up to match the industry’s enormous emissions challenge.
CCUS is the focus of the two largest DOE grants for cement decarbonization projects, each up to $500 million. The first is for Heidelberg Materials, which is planning to capture at least 95 percent of the carbon dioxide — quite a high capture rate for today’s technologies — from its newly retrofitted plant in Mitchell, Indiana, one of the country’s largest cement production sites.
If successful, it would capture 2 million tons of CO2 per year from the plant and store it in geologic formations beneath the plant property.
One of the biggest challenges of CCUS is building the pipelines and wells needed to sequester carbon dioxide deep underground where it can’t escape back into the atmosphere. The biggest U.S. cement CCUS projects, such as the Mitchell plant and two projects with Holcim at plants in Florence, Colorado and Bloomsdale, Missouri, are conveniently nearby underground geological formations that could house large amounts of captured CO2 for centuries. These and other carbon-sequestration plans still face years of work to determine that they’re safe and to secure permits to undertake that work.
The second award of up to $500 million is for the National Cement Company of California, which is taking up a multitechnology approach to its goal of producing “carbon-neutral cement” at its plant in Lebec, California. That project will implement CCUS, and it will also use calcined clay to produce lower-carbon LC3 cement. It will also replace fossil fuels for its kilns with locally sourced agricultural waste such as pistachio shells, which embed the carbon dioxide that trees have previously absorbed from the atmosphere.
None of these awards are final yet — each project must go through contract negotiations, and the companies involved must commit to supplying an equal or greater amount of matching funds. Designing and building each project could take years. And each will need to secure commitments from buyers willing to use the cement it produces.
But if successful, these projects could help provide a blueprint for building a future with much lower-carbon cement — or even “net-negative” cement, as DOE’s announcement describes its longer-term vision.
Why Biden is spending $6 billion on green concrete and whiskey
Tim McDonnell
Wed, March 27, 2024
The News
The U.S. Department of Energy announced this week it will dole out $6 billion in grants to cut emissions from three dozen factories across a wide range of industries — including steel, cement, aluminum, even whiskey and pasta. The Biden administration’s climate strategy up to now has focused primarily on cutting emissions from the power and transportation sectors, particularly via wind and solar energy and electric vehicles. The new funding targets heavy industry, which accounts for one-third of the country’s carbon footprint but has seen much slower progress on decarbonization because the technologies involved are mostly new and have rarely been tried at commercial scale.
The combined emissions savings from all 33 projects would be equivalent to taking three million gas-fueled cars off the road, Kelly Cummins, acting director for the DOE’s Office of Clean Energy Demonstrations, told Semafor. And if all goes according to plan, that’s just a down payment on bigger cuts in the future.
“We want to make sure these are not just one-off projects,” she said. “The only way we’re going to meet our long-term climate goals is if we get replication from these demonstration projects.”
Tim’s view
It may be time to retire a climate cliché: Emissions from the sectors targeted in this program are sometimes called “hard to abate,” because many industrial processes require high temperatures from burning coal and natural gas that aren’t easily replaced by low-carbon electricity. But research and innovation over the past few years have delivered a range of technological solutions for high-carbon industries. Now, the biggest obstacle is getting factory owners, their customers, and their financiers to take a gamble on bringing those from the lab to commercial scale. The new round of DOE funding is meant to lower the stakes.
Of the roughly $811 billion invested by the private sector in climate tech since 2018, only about 5% has gone to low-carbon industrial processes, according to BloombergNEF data. Electric vehicles, by comparison, have captured 30%. For each of the projects in the DOE program, federal funding can supply no more than half of the total investment required, and in most cases much less than that, Cummins said. She expects the DOE’s $6 billion to draw in at least another $14 billion from private investors, with more to follow if the proof-of-concept works.
“We prefer ‘yet to abate’ now instead of ‘hard to abate’,” said Bryan Fisher, managing director for climate-aligned industries at the nonprofit Rocky Mountain Institute. “All of these are near-proven technologies that just need to be demonstrated in a commercial environment. Somebody just has to do the first one, so we can get the second and third ones.”
Projects in the program include replacing coal-burning blast furnaces at an Ohio steel plant with alternatives that run on hydrogen and electricity, a super-efficient aluminum smelter that will be the first such smelter built in the U.S. in 45 years, and a gas-electric hybrid glass furnace in California to churn out low-carbon wine bottles. Some of the grants will benefit startups working on their first-ever commercial-scale facility. Others will benefit big incumbent emitters trying to clean up, including an ExxonMobil petrochemical refinery in Texas, a steel plant run by Sweden’s SSAB, one of the world’s largest steelmakers, and an effort by beverage giant Diageo to replace gas-fired boilers used in the production of Bulleit whiskey with electric ones. Big companies like Exxon may not be obvious candidates for federal climate funding, but they have the balance sheet and technical expertise to put a major dent in emissions if they can be convinced to opt for a lower-carbon alternative, Fisher said.
To actually get a check from DOE, all of these projects have to clear a few more rounds of due diligence, including proving they’ll create local jobs and that they have at least a few early customers lined up that are willing to pay a bit more for green products. Most likely, not all of these projects will pan out. But if even a few do, the return on investment — in terms of emissions reduced per taxpayer dollar invested — would be huge.
Room for Disagreement
DOE’s domino-effect thesis — that getting a first round of projects over the financing hump will tip off a wave of private investment — is far from a surefire bet. Many of the projects here will rely on a steady supply of low-carbon hydrogen, which is practically nonexistent today. There are familiar challenges around infrastructure permitting, as well as offtake contracts: It doesn’t matter if the technology works if customers aren’t willing to pay for it. And all of this is playing out against the rapidly ticking clock of climate change. “Trying to grow infant industries is a complex, multi-decade process,” said Todd Tucker, director of industrial policy at the Roosevelt Institute. “It’s not for people who want quick results.”
The View From Oakland
One of the program’s beneficiaries is Cody Finke, whose startup Brimstone was awarded $189 million to build its first commercial-scale plant producing low-carbon cement using a proprietary chemical process. The company pieced together its early investment from smaller DOE sources and venture funders, Finke said, but the commercial facility was too expensive for its main backers. “Banks don’t have a financing product that takes that much risk, and VCs don’t have a product that’s the right size,” he said. The larger DOE grant makes it much easier to draw in a broader pool of investors, he said, and brings the company closer to making a product that can compete directly with traditional cement on cost. “There are lots of technological solutions to climate change, but few actually will give someone enough profit to make it happen,” he said. “That is really the gating thing.”
Notable
Several of the largest grants in the program will go to companies headquartered in Europe, adding a new wrinkle to the climate tech tug-of-war between the U.S. and European Union.
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