Green Steel, Entropy and Exergy Boundary

CEWT FOUNDATION SERIES – THERMODYNAMIC EDITION Green Steel, Entropy and the Energy Boundary Why Hydrogen DRI Without Electrical Defossilisation Remains an Open System 1. The Thermodynamic Premise Every industrial plant is a thermodynamic system. It exchanges mass, energy, and entropy. The outcome of the system is not defined by one reaction, but by the total energy and entropy crossing its boundary. In steelmaking, hydrogen DRI modifies the chemical pathway. But thermodynamics asks a deeper question: What is the quality of the energy entering the system? 2. Energy Is Not Equal — Exergy Matters Not all energy is equivalent. Thermodynamics distinguishes between energy (quantity) and exergy (usable, high-quality energy capable of performing work). Electricity is high-exergy energy. When electricity is produced from fossil combustion, its generation involves exergy destruction, entropy generation, and carbon release. If fossil-based electricity enters the steel plant, the entropy cost has already been paid upstream. The plant appears clean internally — the entropy has merely been displaced. 3. The Entropy Relocation Effect Hydrogen DRI removes carbon from the shaft furnace. However, hydrogen preheating, electric arc furnaces, compression, and auxiliaries are electrically driven. If that electricity is fossil-derived, entropy generation occurs at the power plant. The steel plant becomes an open system dependent on external entropy production. Carbon intensity has not vanished. It has crossed the thermodynamic boundary. 4. Open vs Architecturally Closed Systems An open system imports high-exergy fossil electricity, relocates emissions upstream, and remains globally carbon-linked. A structurally closed architecture aligns chemical inputs with low-carbon energy sources, minimises entropy generation across the full boundary, and synchronises reduction chemistry and electrical backbone. Circular economy requires thermodynamic coherence. 5. The Exergy Insight Steelmaking is fundamentally an exergy transformation process. Iron ore reduction and melting require high-temperature gradients and high-exergy energy vectors. If those vectors originate from fossil systems, the entropy footprint persists regardless of reaction chemistry. Hydrogen may decarbonise the reductant. Electricity defines the exergy architecture. 6. Circular Economy as a Boundary Condition Circularity is not merely about carbon molecules. It is about closing material loops, aligning energy quality with regenerative sources, and minimising entropy export beyond the system boundary. A steel plant drawing fossil electricity remains coupled to linear extraction upstream. 7. The Architecture Principle Thermodynamics does not allow selective accounting. Entropy generated outside the boundary is still entropy in the system context. You do not decarbonise steel by changing the reductant alone. You redesign the exergy architecture of the entire system. Until hydrogen DRI is paired with a defossilised electrical backbone, green steel remains thermodynamically open. Closing Reflection Energy transition is not a debate about fuels. It is a question of boundaries, exergy quality, and entropy management. Industrial sustainability will be determined not by isolated process improvements, but by coherent energy architecture. Clean Energy and Water Technologies Pty Ltd (CEWT) ABN 61 691 320 028 | ACN 691 320 028 Redesigning Industrial Energy Architecture