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Driving transformation in the metal industry: challenges, technologies and opportunities

The transformation in the metal industry towards climate-neutral production processes is one of the major challenges of the coming years.

Pressemitteilung | Reading time: min | Bildquelle: ABP Induction

CEO Till Schreiter talks about the specific requirements for companies in the metal and foundry industry, current technological developments and the role of digitalization. He highlights the solutions ABP Induction already offers today, how hydrogen can contribute to decarbonization and what obstacles still need to be overcome. He also discusses the significance of global market developments and the role of politics.

A key point is that companies that invest in sustainable technologies at an early stage have the best chance of gaining a competitive advantage when they reach the tipping point. Digitalization is proving to be a key enabler for boosting productivity and increasing flexibility. Schreiter is calling for clear political framework conditions, particularly in the area of energy and hydrogen strategy, in order to provide companies with the necessary investment security.

What specific transformation requirements must companies in the metal production and processing sector meet in order to become climate-neutral?
Till Schreiter: The fundamental challenge for metal production and processing in order to become climate-neutral is to only use processes that do not emit CO2. If we look at the classic processes, we see the blast furnace processes on the crude steel production side and the cupola furnace process in the foundry sector for large-scale production, which is also CO2-based. At the moment, we have no new options in terms of energy supply, apart from either generating electricity using nuclear power or solar or wind energy; realistically, there are no other options available to us.

What innovations are ABP already contributing here today?
Till Schreiter: Electrification of the cupola furnace process is a standard technology for us at ABP. In terms of scaling, we are currently already seeing very powerful systems that are sufficient for a large proportion of production. We are also working on new technologies for heating steel, such as inductive reheating furnaces or the electrification of burner technology.

How can the use of hydrogen in industrial process heat contribute to decarbonization?
Till Schreiter: In principle, using hydrogen to implement industrial process modifications for decarbonization is certainly a cost-benefit issue if you look at it as a whole. The best conversion value is in the steel industry, because decarbonization can have a major effect on CO2 savings. However, the question arises as to whether we can even get the necessary hydrogen to Germany. If we consider that a large part of the raw materials we need for steel production are transported by ship anyway, then one might ask the controversial question: wouldn‘t it make more sense to relocate steel production to the countries that produce the hydrogen and supply the ores anyway?

To what extent do global market developments influence the transformation pressure on metallurgical machinery and plant engineering?
Till Schreiter: Metal industry products are either used in German machine construction or, increasingly, in the German automotive industry. The discussions about the VW Group and the cutting of jobs and sites are currently in the news. This influences the decision as to whether new plants are built in Germany or existing plants are replaced with new technologies.

In Germany, the development prospects are unfortunately not at all clear at present: we have no idea which direction energy prices in Germany should and will take. Why and for what purpose is the German state prepared to guarantee certain electricity prices or the like for German industry? This uncertainty significantly increases the pressure to transform.


What role does metallurgical machinery and plant engineering play as an „enabler“ of the transformation in metal production?
Till Schreiter: Metallurgical machine and plant engineering must look at which production steps in the process must be customer-oriented in order to create new developments of the end products together with the customers. These production steps will remain here in Germany. However, other production steps are being relocated to other countries – either within Europe or to non-European countries.

How can companies in this sector ensure that their technological developments are both environmentally and economically viable?
Till Schreiter: The big question is at what point it is worth converting a system. Customers are currently holding back when there are no government subsidies, as considerable investments would have to be made in decarbonization without knowing where energy prices are heading. As long as there is a market for conventional steel and price is the deciding factor, production will continue to be CO2-intensive.
When the tipping point comes, it comes quickly. In any case, companies should make sure that they prepare for a changeover when they have to replace equipment anyway or when it reaches the end of its service life.

What role does digitalization play in this?
Till Schreiter: Digitalization plays a decisive role. If you are a pioneer in digitalization, you can start now without having to wait for a changeover due to demand or the costs of decarbonization. Digitalization can be used to develop more flexible products that are even more customer-oriented – our experience with this at ABP has been very positive. This is also evident from our projects: Production can be planned much better, energy losses can be reduced, which in turn increases plant availability and competitiveness.

What obstacles need to be overcome in order to accelerate the transition to climate-neutral production processes?
Till Schreiter: The demand on politicians is to create investment protection – through a clearer and more comprehensible energy policy, above all a secure price and energy policy. A clear hydrogen strategy is also needed that pursues realistic goals and makes political decisions that face up to the facts: How much hydrogen is really available for industry in Germany?
In Germany, there is considerable uncertainty regarding future energy prices and the state‘s willingness to create stable framework conditions for the industry. This uncertainty is one of the biggest obstacles standing in the way of change.

What opportunities arise for companies that invest in sustainable technologies at an early stage?
Till Schreiter: Companies that invest in green technologies at an early stage will benefit the most when the tipping point is reached. When the tipping point comes, the company that produces green the fastest and implements it productively will gain the largest market share. Those who only start to deal with the topic then will lag behind. This is where we at ABP are intensively involved – we see ourselves as „your partner on the way to zero emissions“, as we have been promoting it in the industry since GIFA 2023. Our development and application expertise can quickly help companies to drive the transformation process forward.
My recommendation is that companies should start spending money now to have a conversion plan and study in place that is regularly updated so that they are ready to convert at any time. This means not only technical planning, but also financial aspects and possibly cooperation with banks and financing partners. Approval procedures should already be initiated so that you can change over immediately when the time comes.

Company Info

ABP Induction Systems GmbH

Kanalstraße 25
44147 Dortmund
Germany

Telephone: +49 (0231) 997-0

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