AISTech 2019 — Proceedings of the Iron & Steel Technology Conference

6–9 May 2019, Pittsburgh, Pa., USA

DOI 10.1000.377.249

Systematic Optimization Creates Higher Competitiveness

Hong Dai1, Zhichun Hu2, Yewen Zhang3

1
CISDI Engineering Co. Ltd.
No.1 Saidi Road, Liangjiang New Area, Chongqing 401122, China
Phone: +86(23)63545004
Email: Hong.A.Dai@cisdi.com.cn
2
CISDI Engineering Co. Ltd.
No.1 Saidi Road, Liangjiang New Area, Chongqing 401122, China
Phone: +86(23)63545028
Email: ZhiChun.Hu@cisdi.com.cn
3
CISDI Shanghai Engineering Co.,LTD.
No.1, Alley 803, Shuangcheng Road, Baoshan District, Shanghai 200940, China
Phone: +86(23) 61802527
Email: YeWen.Zhang@cisdi.com.cn

Keywords: iron; steel; energy; systematic; optimization

1. GLOBAL STEEL TREND

Looking through the world’s steel developments, two major growth stages accompanied with two deep adjustments have been
experienced. The 3rd growth stage was mainly guided by China’s iron and steel demands succeeding the former two long-
time adjustments, all giving rise to a fast growth in global steel. However, global steel has entered the 3rd adjustment stage
since 2015 resulted from the over-capacity of China’s steel and a minor growth rate of global steel.

Figure 1.Global crude steel output.

The experience of developed countries during the 1st and 2nd adjustments tells that emerging economies are aware of the
driving factors for the future steel: going deeper globally, product restructuring, diversified development, energy
conservation and environmental protection.
To that end, there are four trends of current global iron and steel industry: new trend of international trade; new price
fluctuation of resources and energy; new impact of China and new technology.

© 2019 by the Association for Iron & Steel Technology. 2421

1.1 New Trend of International Trade
The PMI was expanding over 40 months, which indicates the manufacture industry relocated back to the developed countries.

Figure 2.PMI trend in major countries and regions.

Trump has taken office of America, shrinking world trade volume in the anti-globalization trend, manufacture industry
relocated back to the developed countries. All these factors will expose emerging economies’ steel industry to more fierce
international competition.

1.2 New Price Fluctuation of Resources and Energy

Due to the drop of iron ores price since 2013, the manufacture cost difference between 1st and 3rd quartile steel plants has
narrowed down significantly.

Figure 3 Cost curve of world HRC production,2010.

Figure 4 Cost curve of world HRC production,2015.

Steelmakers should pay more attention to the cost competitiveness, especially for the steel plants with their own mines.

1.3 New impact of China

China has been playing greater role in global steel market in respects of direct export, indirect export and international
cooperation on product capacity.

2422 © 2019 by the Association for Iron & Steel Technology.

 Figure 5.Export of semi-finished and finished steel products.
There are several characteristics of recent China’s iron and steel industry:
With the implementation of One -belt one-road strategy, the cooperation in infrastructure and international production
capacity is accelerated, and the steelmakers are fasten their paces of going global. Countries along the One-Belt One-Road
will be prospective, especially cooperation between China and Kazakhstan, Africa and Latin America;
Accelerating industry-wide mergers and reorganization, forming 2~3 mega steel enterprises, expanding and upgrading in
essence;
Accelerating to cut China’s steel overcapacity and 15Mt/a overcapacity has already been removed in 2018; the national target
of removing 100~150Mt/a crude steel in China’s 13th five-year plan (2016~2020) has been fulfilled ahead of schedule,
laying solid foundation for good momentum of steel industry.

1.4 New technology

Manufacturers face the challenge of deciding when additive manufacturing technology offers a suitable process to produce a
given product.[1]
Nowadays, the innovation, smart manufacturing, green manufacturing, international are key to future development of steel
industry.
For steel producers, applying new technology at new and old plants; intelligent manufacture improving production efficiency;
green manufactures benefiting environmental effect would be the main direction to enhance competitiveness.
With the new global steel trends and the external challenges and opportunities, steel producers should focus more and more
on improving competitiveness by technological advancement and internal cost-saving. Under these circumstances, energy
systematic optimization serves as a very effective way of achieving the target.

2. INTRODUCTION OF ENERGY SYSTEMATIC OPTIMIZATION

The energy systematic optimization (ESO) is a method of competitiveness improvement through overall consideration of
various energy flows in steel production process.
Under the microeconomic situations and the industrial environment, steel plants worldwide are facing a nearly perfect
competition market and the same source of raw material. So the price of products and raw materials are losing impact over
the competitiveness of steel plants. Aim to earn more profit, steel plants have to reduce variable cost by technical method,
especially by systematic optimization. Reduction of energy consumption is the most direct and efficient way to reduce
production cost in steel producing. [2]
Energy systematic optimization is conducted in a systematic view. We combine plant-wise analysis of the overall energy
system with process-wise energy consumption analysis, identify bottleneck problems of existing energy system and explore
for reasonable energy recovery plan, and ultimately achieving the goal of energy economic utilization for the whole steel
plant.
Systematic, economic and sustainable are the overall principles guiding our ESO service. Systematic means that we focus not
only on the energy system itself, but also on the relationship between different production processes, reduce consumption and
improve the utilization of resources. Economic means that we focus on improving cost competitiveness, optimization of
CAPEX and OPEX. Sustainable means that our optimization service pursues competitiveness sustainable and environment
sustainable solutions.

© 2019 by the Association for Iron & Steel Technology. 2423

2.1 Overall Methodology
The steel production process involves the interaction of many flows, including the ferrite flow, the flows of electricity,
coking coal, compressed air, industrial water, etc. Among them some are out-sourced; some are generated within the steel
plant. These flows, dynamic and inner-connected, deserve systematic consideration, which marks the beginning of our energy
optimization services.
We separate systematical optimization into 3 levels: the top level is system level, middle level is interface level, and the
bottom level is the process level. System level is the spine line that goes through the whole production process, including
ferrite flow, mass flow (logistics), energy flow, and discharging flow, even information flow. Interface level is the interface
between processes, sometimes easily ignored. Process level is more specific and detail-oriented, like ironmaking,
steelmaking, etc. Generally, steel plant itself has the advantage to optimize processes. However, in system level and interface
level, engineering company holds more advantage than steel plants.
By analyzing the sources, flow directions, consumption and recovery of every kind of energy resources and the interaction of
different energy flows, we draw out the overall energy flow map of a steel plant.

Figure 7 Schematic of energy flow and other flows

The following step is to apply our key analytical tools of optimization. We focus on the sublevel targets—using our Fe flow
analysis, energy bridge analysis, energy flow analysis, interface analysis, bottleneck analysis and simulation analysis, we
compare with benchmarks the energy production and consumption level, balance of energy system, energy efficiency and its
supply and demand, and identify the processes that show room of reducing energy loss and propose potential measures and
solutions to improve energy efficiency and reduce total energy costs.
After forming this potential optimization solution pool, we weigh the capital investment and the economic benefit of each
optimization solution, rank them by the economic effectiveness and propose an implementation roadmap in accordance to the
budget of the steel enterprises.

2.2 Key Analytical tools

The energy systematic optimization is integrated with multiple analytical tools and models. The key analytical tools we use in
our energy systematic optimization process are Fe-flow analysis, energy bridge analysis, energy flow analysis, interface
analysis, bottleneck analysis and simulation analysis.

Fe-flow analysis
Fe flow analysis is used to identify and improve the effectiveness of energy production and consumption. We classify the
ferrite flows into four types: the main Fe-flow, recycled Fe-flow, sold products and Fe loss. Through the optimization of
ferrite flow, we aim to reduce Fe loss and raise the main Fe flow utilization rate, improving the utilization efficiency of
resources.

Energy bridge analysis

Finding loss is the start of improving efficiency. Energy loss in steel plant is mostly occurs in storing, acting, reacting,
transporting and transforming. At the end of the processes, energy is transformed into two parts: one is loss, the other is
concentrated in the finished products. Energy bridge is used to find energy loss in different processes.

2424 © 2019 by the Association for Iron & Steel Technology.

 Energy flow analysis
Based on the flow and loss analysis, we’re able to establish an energy flow network model, through which we can
continuously improve the efficiency of the energy system for a steel plant.

Figure 8 Energy flow analysis

3. TYPICAL CASE STUDY

Since 2009, CISDI has provided operation optimization services to over 20 iron and steel enterprises worldwide, including
China, India, Brazil and Vietnam. In each case, CISDI’s energy systematic optimization service helped the client reduce
overall energy consumption and brought them significant economic benefits.
A steel plant in China, employed our energy systematic optimization services and successfully and significantly reduced its
energy cost in the following years. From 2007 to 2014, A Steel, adopting our energy systematic optimization solutions, has
reduced the total energy consumption of 73kgce/t: 41 kgce/t via system upgrade, 28 kgce/t via waste heat recovery and 4
kgce/t via equipment restructuring.

Figure 9 Energy systematic optimization of A Steel Plant

First we start with problem finding. Our full-flow temperature analysis shows great interface energy loss. The total
temperature loss amounted to 880℃，which equals to the calorific value of14,8000t coal.
Then we proposed potential measures to tackle the problem. we used tailor-made simulation model, simulating from BF to
steelmaking, visual displaying the workshop of hot iron transport and the dispatching process, transportation organization
scheme, to optimize the torpedo transport organization plan, guaranteed the feasibility and effectiveness of optimization plan,
helped increase torpedo turnover rate and decrease the iron steel interface temperature loss of 25℃，which reduces
comprehensive energy consumption of 0.95kgce/t. The annual cost saving was USD2.12 million.

© 2019 by the Association for Iron & Steel Technology. 2425

Regarding to gas recovery, we analyzed the generation and flow directions of BF gas, COG and LOG of A Steel. What is
revealed by the analysis is that at the time, A Steel had a high BFG direct discharge rate of over 5.1%, COG waste and low
converter gas recovery rate. We proposed a new equalizing gas recovery system, a BF gasholder and a set of TRT to be
installed for blast furnaces.
Meanwhile, increase caloric value detecting frequency and adjust air-fuel ratio through oxygen meter before the gasholder is
built and adopt automatic combustion control system afterwards. For the BOF, build new gasholders as well as make use of
the existing facilities and improve the recovery of converter gas. The total CAPEX for the implementation of the solutions is
USD51.19 million while the economic benefit is over USD40.34million.
In regard with the steam system, in preliminary studies we identified the biggest problem is the high makeup water
consumption, low power load and low utilization of steam. With our optimization service, we increased steam drum pressure,
reduced water consumption and improved its power generation efficiency. With a CAPEX of only USD476,000, the annual
economic benefit amounted to USD 603,000.
Another potential optimization solution is about the water system. Through the study of plant-wide circulating water system
we realized energy-saving from “work sequence, transportation and equipment”. By changing the pumps, adjusting valves
and pipeline, with a total investment of USD 238,000, we reduced the power consumption of about USD 476,000 per year.

Figure 10.Water system optimization of A Steel

After identifying the possible optimization items and the proposing economic solutions, we divide all our suggested solutions
into groups according to the input-output efficiency and technical implementation difficulties, and propose a phased
implementation roadmap to help our client to implement the optimization.

4. CONCLUSION
In conclusion, energy systematic optimization is an efficient and economic means to boosting competitiveness of steel
enterprises. It has been widely recognized by more and more steel producers in today’s global steel market.
Thanks to our commitment and achievements in systematic prospective, enriched experience and scientific tools and
methods, we provide continuous solutions to energy systematic optimization so that the steel plants can tap the ultimate
potentials and display the best of their resources in pursuit of boosting an overall competitiveness.

REFERENCES
1. Eddy, Douglas; Krishnamurty, Sundar; Grosse, Ian, ASME International Design Engineering Technical Conferences
and Computers and Information in Engineering Conference, AUG 02-05, 2015
2. Y Zhao, R Ji, Z Ma, Y Guo, C Caoxian, W Jinzhong, Systematic Energy Saving and Optimization to Reduce
Comprehensive Energy Consumption Per Ton Steel, Energy for Metallurgical Industry, Apr. 1998, China

2426 © 2019 by the Association for Iron & Steel Technology.