263Directionality in Innovation Policy and the Ongoing Failure of Green. . .

Despite being an economic catastrophe that has received a lot of attention in Swedish press, Sekab kept receiving positive media coverage. Sekab received various awards, both locally and internationally, and was visited by people from the US embassy. For the politicians involved, Sekab might have been a success story. Policymakers may have appeared as visionary and decisive, combating climate change with initiatives that resulted in new pilot plants and new jobs in the short run.

5.4

Hydrogen Steel: A Risk for Both the Environment

and the Economy

As stated above, hydrogen steel requires large amounts of electricity. The supposedly fossil-free steel will make use of 67–72 TWh of electricity, totaling more than 50% of Sweden’s annual electricity production today.

The opportunity cost for such volumes of electricity cannot be neglected. According to Professor Björn Karlsson at the University of Gävle, 15 TWh could be used to transfer electricity to countries like Poland or Germany, where coal plants emit a lot of greenhouse gas. Making use of 15 TWh in this way would mean that 15 million tonnes of carbon dioxide could be removed. As fossil-free steel will make use of 67–72 TWh, we estimate that at least ten times more carbon dioxide emissions could be removed by making use of electricity in this alternative way.

Although this calculation may seem theoretical, the opportunity cost nevertheless needs to be considered. Referring to green steel as green or fossil free is only correct as long as there is no better alternative use of green electricity. In the foreseeable future, there are many much more efficient ways to cut emissions. Moreover, according to Tobias Persson at Tillväxtanalys, there is already considerable competition from recycled steel, which amounts to 40% of all steel consumption today and makes use of 75–95% less energy than conventional steel (FTI, 2009).

Making use of hydrogen gas is also associated with substantial losses of energy throughout the process. About 30–40% of all energy is lost in the process of electrolysis (My Fuel Cell, 2015). If so, large amounts of energy are lost along the way and the total amount used is 70 TWh, about 21–28 TWh will disappear. This volume corresponds to 15% of Sweden’s electricity production and all energy that is used by the Skåne region, with its 1.4 million inhabitants and 600,000 jobs. How can it be sustainable to implement a process which effectively wastes 30–40% of all