Formulas for power. Forecasts about the dominance of countries.
During my studies at the Technical University of Aachen, I had physics lectures with Professor Wilhelm Fucks. His carnival lectures were legendary. However, his book Formulas for Power was rather ridiculed at the time. One fascinating theory from the book was that the countries with the highest steel production would also become the economic leaders in the world - a theory that proved to be true, albeit not in the time predicted.
China: The giant of the steel industry
Today, China is the world leader in steel production with 1 billion tons per year. It is remarkable that I have yet to hear of any innovation in products and processes. Germany is only in seventh place with an annual production of around 37 million tons of steel and an annual turnover of around 55 billion euros. The steel industry plays a crucial role in global growth, particularly in sectors such as electromobility in the automotive sector, mechanical engineering and electrical engineering. However, the impact on CO2 balances is also of great importance.
Steel production and its environmental impact
Steel production is also one of the most polluting industries and is responsible for around 9 % of global CO2 emissions alone. In Germany, the manufacturing industry contributes 22 % to the country's total CO2 emissions, of which iron and steel production accounts for around a third. These figures make it clear how much leverage the reduction of emissions in steel production represents for climate protection.
The role of innovation
Innovation, not renunciation, will have to play a decisive role in the necessary transformation of the steel industry. The introduction of hydrogen-powered direct reduction plants is a promising step towards green steel production. These plants make it possible to convert iron ore into steel using hydrogen as a reducing agent, resulting in significantly lower CO2 emissions. However, these processes are very energy-intensive and require a significant amount of green energy. For the 25 million tons of steel produced by thyssenkrupp in Germany, for example, an additional 85 billion terawatt hours would be required. This is equivalent to 20% of Germany's annual electricity consumption (~485 TWh, 2022) and illustrates the enormous amount of energy required to switch to green steel. The availability of green electricity is becoming a key factor.
At the Munich Management Colloquium experts like Mr. Osburg from the thyssenkrupp Steel Europe AG will comment on these challenges and explain how they want to help shape the future of a more sustainable steel industry. We cordially invite you to join us on March 5 and 6, 2024 at the 31st Munich Management Colloquium to discuss with us possible solutions in these challenging times! Further information on the speakers and tickets can be found on our Event website.
Prof. Dr. Dr. h. c. mult. Horst Wildemann is a professor at the Technical University of Munich and heads the management consultancy TCW. On March 5 and 6, 2024, he will be hosting the Munich Management Colloquium for the 31st time with over 80 speakers from leading companies