Cleveland-Cliffs announced
Monday its Middletown Works steel production complex
is in the running to receive up to $500 million in federal funding to
build three new plants to reduce carbon emissions.
The
new facilities would replace a blasting furnace on site with three facilities
powered by hydrogen and natural gas. The company said if it wins the money now
that it has been selected by the Department of Energy for award
negotiations, it would spend $1.3 billion on the project, which is expected to
create 170 new jobs in the region and preserve 2,500 existing jobs.
The
federal grant would be awarded from the energy department’s Industrial Demonstrations Program, which
supports decarbonization projects in energy-intensive industries. The program
is funded under the Infrastructure Investment and Jobs Act of
2021 and the Inflation Reduction Act of 2022, both
signed into law by President Biden.
Cleveland-Cliffs
said in a statement its Middletown site is large enough to build the new
facilities near existing ones without interfering with ongoing production of 3
million net tons of raw steel per year. Once constructed, though, it estimated
the new facilities could trim $450 million in production costs, maintain
quality production and reduce its dependence on scrap metal, which is expected
to be in shorter supply in years to come.
The
new facilities would reduce Middletown Works’ iron-making carbon intensity by
50% to 90%, the company said. The company said another site, Butler Works in Lyndora, Pennsylvania, about
30 miles north of Pittsburgh, is also in the running for a $75 million grant
from the energy department.
Cleveland-Cliffs
CEO Lourenco Goncalves credited the company’s successful completion of a hydrogen-ready plant in Toledo for helping
secure this latest opportunity.
“Completion
of our $1 billion clean hydrogen-ready Toledo DR Plant through the depths of
COVID stood as strong evidence of Cliffs’ expertise and resolve to drive down
emissions,” Goncalves said in a statement.
