Last week a Swedish plant had delivered the world’s first shipment of fossil fuel free steel to the car maker Volvo. Coking (metallurgical) coal in the blast furnace was replaced by hydrogen produced with renewable energy. The Swedish company plans to start delivering commercial quantities of this green steel within five years.
The Swedish plant is not the only one working on fossil fuel free steel. One of the world’s largest steel manufacturers, Thyssenkrupp, has successfully run a blast furnace with part of the coking coal replaced by hydrogen. Mining giant, Rio Tinto, is also collaborating with steel makers to replace coal in steel making.
Here in Queensland we produce the world’s best quality coking coal. The high energy content, lack of impurities and ease of mining means we have an advantage over other coking coal miners. About 65 per cent of the coal produced in our state is high value coking coal, most of it exported.
We should be concerned about the trend towards green steel production. There are global moves to more rapidly reach net zero emissions of carbon dioxide. While steel production is not the largest carbon emitter, it is significant, producing about 9 per cent of global carbon pollution.
Our governments have argued that, unlike coal used to produce electricity, there is no alternative to coking coal in steel making. That argument no longer stacks up.
Car companies such as Toyota, VW and General Motors will seek an early advantage over their competitors by producing vehicles that are both manufactured and fuelled by renewable energy. In the longer term, global environmental policies will mean all steel will be fossil fuel free. That presents us with a serious challenge.
Our region has become dependent on the wealth generated by the coal industry, especially during the past two decades. Our political leaders seem to think coal mining will be here forever, but coal demand will inevitably plummet once green steel becomes more commonplace. Coal mines will close and unemployment increase. We need government at all levels to start planning now to an alternative economic future for Mackay.
For example, we must identify business and employment opportunities in a region with very little coal mining. We will also have to work out how to re-engaged our children with education as the key to individual prosperity.