Fine mineral granules could be the first fossil fuel abandoned in favour of more environmentally friendly alternatives, a not-for-profit warned.
The Institute for Energy Economics and Finance recently predicted pulverised coal for injection (PCI) will be the first combustable rock to be phased out.
Energy finance analyst Simon Nicholas claims BHP, Rio Tinto, thyssenkrupp and BlueScope are more interested in using green hydrogen to manufacture steel instead of traditional PCI products.
“This is presenting challenges for the future of Australia’s PCI and coking coal, particularly with opportunities for hydrogen apparent in the short-term in blast furnaces and longer term in direct reduced iron processes,” he said in a public statement.
Mine developers have flagged their intention to allocate a specific percentage of proposed coal product for PCI.
“The outlook for PCI coal is now looking increasingly challenged by technological change, just as renewable energy has impaired thermal coal’s long-term outlook,” Nicholas said.
The analyst also revealed the continuing Russia-Ukraine border dispute, and potential shortfall of up to 144 million tonnes (mt) of thermal coal and about 37 mt of metallurgical coal, will only accelerate the transition towards low carbon steelmaking.
“At this stage of the technology transition, when you have got these extremely high prices and who knows how long this situation in Ukraine is going to go on for – plus renewed energy security concerns as a result of that – that is now elevated further,” he said according to Stockhead.
“In the longer term that level of pricing [and] that level of concern about energy security will certainly overtake any concerns about carbon emissions. It is only likely to accelerate this shift even faster.”
His best-case scenario is there will only be “some” need for coking coal in the year 2050 while Wood Mackenzie expects PCI use to halve by the very same year.
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