In conversation with Laurent Plasman, Chief Marketing Officer, ArcelorMittal Europe – Flat Products Industry

“In 2016, wind turbines accounted for 15% to 20% of our output,” said Laurent Plasman, ArcelorMittal’s head of sales for its flat steel operations in Europe. “Now it’s between 50% and 60%. In terms of revenue, that has compensated for the switch from oil and gas. And the demand from wind just continues to accelerate, to the point where it will outstrip what we ever saw from oil.”

After more than a year of turbulence at leading wind-turbine manufacturers like Denmark’s Vestas and Spanish-German outfit Siemens-Gamesa, or leading off-shore wind-farm operator Orsted, it’s easy to take such breezy optimism with a pinch of salt. However, looking beyond the negative headlines about supply-chain hiccups and raw-material price inflation, the long-term winds for steel are only blowing in one direction – up.

Consider some basic numbers. As part of commitments to decarbonising its national economies, the European Union has agreed a binding target to source 42.5% of its energy from renewable sources by 2030. Its stretch target is 45%. To get there, the region’s installed wind capacity will have to double from 255GW in 2022 to more than 500GW – well over double Germany’s entire generating capacity. In simple terms, that means tens of thousands of new windmills, each of them sitting atop a tower made of steel plate.

More importantly for steel producers like ArcelorMittal, the lion’s share of that extra capacity will come from off-shore energy farms. Far out at sea, winds blow stronger and more consistently, making them more predictable – an important consideration given the intermittency of most renewable energy supplies – as well as more efficient and powerful.

At the same time, the harsh environment and engineering challenges mean they require far more steel per unit of electricity produced. For instance, onshore turbines require 50 tonnes of steel for every MW of power output; offshore turbines, which can be as high as 250 metres from sea-level to turbine tip – higher than the Eiffel Tower - might require as much as 300 tonnes per MW. That means up to 3,600 tonnes of steel for each of the biggest turbines currently being installed.

“Based on these sorts of numbers, it’s clear that the current consumption of 2.0 million tonnes of steel plate will at least double by the end of the decade,” Plasman said.

Nor is wind the only renewable energy sector underpinned – literally – by steel.

As part of the 2022 REPowerEU plan, the EU Commission set a target of growing solar capacity to over 320GW by 2025 – double 2022 levels – and almost 600GW by 2030. Hitting these targets will entail massive investment in solar PV, either on the roofs of residential and commercial properties, or utility-scale installations. The latter in particular are set to be a major source of long-term steel demand, with solar parks requiring up to 40 tonnes of steel per MW of power.

This soaring demand for solar panels is also forcing steel producers to innovate, especially when it comes to weight and durability. With homeowners justifiably concerned about overloading their rafters, companies like ArcelorMittal are developing lighter high-grade steel products to rival more expensive aluminium. And for solar-farms, the company has developed Magnelis, a metallic coating made of zinc, aluminium and magnesium that provides enhanced corrosion protection due to its unique ’self-healing’ properties.

“The PV panels in a solar farm are certified to last 25 years, so they need to be mounted on frames that are going to last just as long. Typically, these facilities are situated in harsh environments where they are exposed to extremes of wind and temperature, so wear and tear and corrosion is a really big issue,” Plasman said.

As Europe’s renewable energy revolution gathers pace, the wind and solar companies developing projects are increasingly looking at their supply chains and asking for low-carbon solutions.

“It’s counter intuitive to produce clean energy from carbon intensive materials. We are therefore seeing increased interest from our renewable energy customers in our range of XCarb® low-carbon emissions steel. It’s very much a growing area. Our challenge here is not stimulating demand, but ensuring we can increase supply,” said Plasman. Recent examples of customers adopting low carbon steel for major renewable projects are Vestas for the Baltic Power wind farm development, or Gonvarri Solar Steel and Iberdrola for a major 41 MW project in Portugal.

Other energy-transition applications for steel come from pipelines to transport carbon dioxide for sequestration in gas-permeable rock formations deep underground, or so-called ‘green’ hydrogen, made from the electrolysis of water molecules using electricity from renewable sources.

“This is the next step for us in terms of how we can continue to support and facilitate Europe’s drive to clean energy, it’s very much on the horizon. It will require a new type of line pipe, albeit nothing that is a million miles from what we produce today. Our R&D teams are already working on this. We’ll be ready for the opportunity as this market develops,” concluded Plasman.