At the center of the fight against climate change is a persistent issue that receives far less attention than electric vehicles and is housed within a blast furnace. In order to produce steel using the conventional method, coal is required not only as a fuel but also as a chemical reducing agent that extracts oxygen from iron ore. It is an old, violent, and efficient reaction that alone accounts for almost 10% of the world’s carbon emissions. Even with solar panels on every roof and electric vehicles in every driveway, the world will still produce a few billion tons of steel annually by burning iron ore with coal. Hydrogen is being asked to address this issue, which is why some have begun referring to it as the “dark horse” of the entire shift.
Once you realize why batteries are unable to do this function, the attractiveness becomes clear. In addition to energy, heavy manufacturing requires chemical reactions that electricity cannot duplicate as well as massive amounts of constant, scorching heat. An automobile can be moved by a battery. Iron ore cannot be reduced at 1,500 degrees. Hydrogen is capable of both. Hydrogen is used in place of coal as the agent that removes oxygen from the ore in the steel process known as Hydrogen-based Direct Reduction, or H-DRI. The only byproduct of this process is water vapor rather than carbon dioxide. For every ton of steel, 50 to 80 kilograms of hydrogen are needed. This may seem like a lot, but keep in mind that coal and a chimney are an alternative.
The industries that electrification keeps stumbling over follow the same rationale. Cement has a serious pollution issue of its own. Battery weight becomes prohibitive during long-haul shipment over thousands of miles of ocean. Heavy machinery: JCB and other businesses have developed hydrogen-combustion engines for excavators, which would be ridiculous to run on batteries. The division of labor that has been developing makes sense: hydrogen takes the heavy, hot, continuous applications, while batteries win the light, short-range, stop-and-start ones. Although it’s not as romantic as the EV revolution, it could have a greater impact on the climate because these are the exact areas for which no one else has a satisfactory solution.
There is always a catch: not all hydrogen is clean, and the clean variety is costly. Although it sounds like marketing, the industry refers to hydrogen in terms of colors, which is actually a helpful acronym. Green hydrogen is created by electrolyzing water with renewable electricity. It’s the truly clean form, but it’s also the most costly and difficult to scale at the moment because it requires a lot of inexpensive renewable energy to be profitable. Natural gas is used to make blue hydrogen, which is cleaner than the current system but depends on carbon capture actually operating at scale, which is still debatable. The generated carbon is then trapped and stored underground. The majority of hydrogen produced today is neither; it is “grey,” derived from natural gas with pollutants that are simply dumped into the atmosphere.
White hydrogen, commonly known as natural hydrogen, is the true black horse inside the dark horse. This is hydrogen gas, which naturally exists in subterranean quantities in the Earth’s crust and is just ready to be extracted like oil. It could provide the most affordable and plentiful clean hydrogen available, without the need for costly electrolysis, if it can be tapped consistently and on a large scale. This is a huge if because the field is still in its infancy and the geology is not well understood. In areas where geologists suspect significant natural reserves, there has been a modest surge of investment and exploration. It’s speculative, it might not work out, and it’s the kind of long-shot that has the potential to completely fail or completely change the economic landscape. One of the more really unclear stories in energy at the moment is seeing it evolve.
In contrast to the excitement, an honest evaluation of where things stand in 2026 is dismal. Earlier this year, SteelWatch evaluated 18 major global steelmakers and discovered that none of them were truly prepared to switch to near-zero-emissions manufacturing. Not one. The current hydrogen-based steel initiatives, such as Salzgitter’s SALCOS program in Germany and other pilots in the US and Europe, are real but insignificant in comparison to the scope of the issue. Instead of the all-encompassing fantasy of a few years ago, the early hype cycle, when hydrogen was supposed to power everything from cars to home heating, has given way to something more disciplined and honest: a focus on hard economics and the particular industries where hydrogen truly makes sense.
Deployment is now being driven by infrastructure clustering and industry policy rather than consumer enthusiasm. In areas like Houston, where there is already energy infrastructure and industrial demand, the US has begun constructing regional “hydrogen hubs”—networks that link production, storage, transportation, and industrial users. The goal is to solve the chicken-and-egg dilemma: without consumers, no one can produce hydrogen, and without supplies, no one can convert their plant to produce hydrogen. The practical solution is to concentrate both at a hub and use federal funds to keep things running smoothly. Similar actions are being taken in Europe. It’s sluggish, policy-driven, regional, and unglamorous, which is probably how actual industrial change appears rather than how it’s marketed.
