CISRI | Linyi

The China Iron & Steel Research Institute Group (CISRI) is a national research institute and state-owned enterprise in China, overseen by the central State-owned Assets Supervision and Administration Commission (SASAC). It has been conducting research on pure hydrogen metallurgy for more than 20 years. CISRI’s Linyi project in Shandong Province represents one of the most significant breakthroughs in global iron and steel decarbonisation. As an industrial-scale pure hydrogen direct reduced iron (DRI) facility, the project demonstrates China’s ambition to advance to near-zero carbon metallurgy by combining long-term research, abundant renewable energy resources and state-backed industrial innovation.

As the second most industrialised province in China, the pure hydrogen DRI demonstration plant was strategically commissioned in Linyi, Shandong. It provides an ideal location to showcase its technology to downstream users, regulators and future investors.

The Linyi plant is fully optimised for 100% hydrogen reduction with no syngas or natural gas blending possible. The pilot tests have demonstrated some unique technical features including electric heating of the process gas using clean electricity, the ability to process virtually all iron ore grades, achieving a ~5% higher metallisation rate than conventional DRI and a design that incorporates a recycling loop that prevents any hydrogen losses. The facility operations are also 100% automated and incorporate advanced AI-assisted safety controls, heating optimisation and support digital twin development.

Although the Linyi facility has a nominal capacity of 50 ktpa, it is not used commercially. Instead, it functions as an R&D and validation platform. Test results are now feeding directly into a wave of commercial scale projects, four of which already under construction:

• One 300 ktpa plant in Songyuan (wind-powered).One 300 ktpa plant in Songyuan (wind-powered)
• Two lines of 600 ktpa each in Baotou, Inner Mongolia
• Two plants in Xinjiang, one of 300 ktpa and one of 1,200 Mtpa

With four more under development, all using 100% green hydrogen.

Delivering the Linyi project required deep collaboration across China’s industrial system:

• National and local state grid authorities to guarantee renewable electricity supply.
• Hydrogen producers to ensure consistent hydrogen availability.
• EPC subsidiaries of CISRI to deliver engineering, construction and commissioning.
• Downstream steel users to secure product offtake, especially with high-end manufacturers.
• Local & national governments for permitting, policy support and renewable energy access.

Because China’s steel sector faces overcapacity, offtakers are generally reluctant to coinvest. However, for high-end steel grades enabled by pure hydrogen metallurgy, CISRI is engaging select customers. Carbon-free DRI produced via hydrogen metallurgy offers additional intrinsic advantages, particularly for the manufacture of higher-end and special products such as automotive steel, tool and die steels, superalloys, stainless steel and electromagnetic materials. 

Pure hydrogen metallurgy is becoming cost competitive in China, due to the very low-cost of clean electricity, which has reached average costs as low as 0.1 RMB/kWh (i.e. ~15 $/MWh). Other driving factors include increasing scale in renewable hydrogen, in-house engineering and fabrication capacities and strong policy alignment with national decarbonisation targets. 

The Linyi project represents a turning point for both China’s and the world’s steel industry. CISRI is demonstrating that pure hydrogen metallurgy can be technically viable, cost competitive under China’s renewable energy conditions and scalable with more than 4 Mtpa of capacity already under development.

The Linyi project represents a turning point for both China’s and the world’s steel industry. CISRI is demonstrating that pure hydrogen metallurgy can be technically viable, cost competitive under China’s renewable energy conditions and scalable with more than 4 Mtpa of capacity already under development. By combining abundant renewables, state backed innovation, strong engineering, procurement and construction capabilities and a fast-growing domestic technology base, China is gearing up to position itself as the centre of near zero carbon iron-making.