Hydrogen metallurgy is an effective way for the high carbon emission steel industry to achieve low‐carbon green transformation and upgrading. According to energy conservation law, the article establishes gas utilization rate and thermal balance calculation models, discusses the influence of key factors such as reducing gas composition, reducing the temperature, and metallization rate on the gas utilization rate and energy consumption, and theoretically calculates the change of energy consumption in the process of steel industry production caused by using hydrogen. The optimal reduction temperature range is 1250–1350 K, which has theoretical minimum energy consumption, about 3.14 GJ, and maximum gas utilization rate, about 45%. The results show that when using 100% hydrogen reduction, increasing the reduction temperature properly lower theoretical energy consumption can be achieved and raise gas utilization rate and further achieve the goal of energy saving and consumption reduction, which is expected to provide beneficial help for hydrogen metallurgy developing in the steel industry.