Minister Schulze delivers statement of intent on funding of 55 million euros for hydrogen-based steel production
During today’s visit to the ArcelorMittal Hamburg steel plant, Federal Environment Minister Svenja Schulze declared her ministry’s intention to fund a project aimed at producing climate-neutral green steel. Germany’s Environment Ministry (BMU) has pledged 55 million euros under the Industrial Decarbonisation Programme to fund the use of hydrogen for the direct reduction of iron ore (DRI) in this project. The final funding approval and the start of the project are still subject to the EU Commission’s approval under the state aid rules. The approval procedure is in progress.
Federal Environment Minister Svenja Schulze commented, "Coal has always been needed to produce steel. We support efforts to replace coal by wind and solar energy in the future. Transforming the steel industry is a tremendous challenge. The sector can count on the Federal Government to support this transformation. My ministry’s Decarbonisation Programme provides special support for decarbonisation investment. Our ambitious climate targets are both a challenge and an opportunity for industry. Companies that invest today in processes and products with net-zero carbon emissions, such as green steel, will survive on the market and safeguard employment tomorrow. This transformation hinges on an increase in renewable energy capacity. Saying yes to viable steel production in the future also means saying yes to the vigorous expansion of wind and solar energy capacity."
The steel sector accounts for 58 million tonnes of CO2 or 7 percent of CO2 emissions in Germany. The ArcelorMittal H2H project with its total investment of more than 110 million euros will implement a low-carbon, hydrogen-based steel production process on an industrial scale. To this end, the company will build a hydrogen-powered DRI plant at the existing site in Hamburg. In addition, the project is designed to show how to process the directly reduced iron ore to produce crude steel in the electric arc furnace and then high-quality wire rod products in the rolling mill. The ArcelorMittal project will make a crucial contribution to the steel industry’s adoption of climate-neutral production processes and to the ramp-up of the hydrogen market.
The Industrial Decarbonisation Programme implements a measure set out in the Climate Action Programme 2030 and the National Hydrogen Strategy. The programme is primarily geared towards energy-intensive industries such as steel, chemical, non-ferrous metal, lime and cement. These sectors are facing the specific challenge of reducing or even preventing process-induced emissions resulting from the use of hard coke, for example. The point of contact for the BMU funding programme is the Competence Centre on Climate Change Mitigation in energy-intensive Industries (KEI) in cooperation with the Federal Environment Agency (UBA).