The Indian government will put up estimated $12 million to part fund a pilot project to develop the country's first direct reduced iron (DRI) plant running entirely on hydrogen, aimed at reducing carbon emissions from the steel sector, a government official said on Tuesday, September 15.
The pilot project costing around $22 million will be undertaken by the government's Central Industrial and Scientific Research (CSIR) in collaboration with the Institute of Minerals and Materials Technology (IMMT) and is scheduled to be completed by August 2029, focusing on developing and demonstrating hydrogen-based DRI technology suited to Indian conditions, particularly the use of domestic iron ore, the official said.
The key challenge will be processing India's relatively low-grade hematite ores. Several international hydrogen-DRI projects use higher-grade magnetite, making the Indian raw material challenge different, he said.
Some private steelmakers are currently working on projects involving partial use of hydrogen, with plans to increase its share gradually. But, in contrast, the CSIR-IMMT project will focus on a 100 percent hydrogen-based DRI plant using a vertical shaft furnace design operated entirely with hydrogen, a scientist associated with the project said.
Green hydrogen currently costs around $5/kg and would need to become substantially cheaper, at around $1/kg for hydrogen-based steelmaking to become commercially competitive. At present, green steel production costs around $200/mt more than conventional steel produced using fossil fuels.
