The European Commission approved on Tuesday 4 October a €1 billion German aid package to help Salzgitter Flachstahl GmbH (Salzgitter) decarbonise its steel production processes by using hydrogen, including renewable hydrogen produced on site, in a new production facility.
This measure contributes to the objectives of the EU hydrogen strategy while helping to reduce dependence on fossil fuels imported from Russia and accelerate the green transition, in line with the EUREPower plan.
The decision follows the approval of two important projects of common European interest (IPCEI Hy2Tech and Hy2Use) in the hydrogen value chain (see EUROPE 13026/14).
The aid, which will take the form of a direct grant, will support the construction and installation at the company’s site in the town of Salzgitter (Lower Saxony) of a direct reduction plant and an electric arc furnace which will replace one of the blast furnaces currently operated by Salzgitter. This will replace the use of fossil sources (i.e. the carbon in iron ore) with hydrogen in steel production, thus avoiding almost all direct CO2 emissions in steel production.
The new facility will produce approximately 1.9 million tonnes per year of crude steel in a more environmentally friendly way - the same volume of crude steel currently produced by a more polluting process. (Original version in French by Lionel Changeur)