Germany has plans to reduce its carbon emissions by 65% by 2030 (compared to 1990) and achieve net zero by 2045. The majority of steelmakers are providing roadmaps for their decarbonisation plans to meet the net zero carbon emission targets of the Paris Agreement. Germany’s forecasted average growth for crude steel production in the medium and long-term for the 2025-2040 period is 0.5%. For comparison, Europe’s forecasted average growth rate for the same period is 1%. 

Drivers of Transition 

Various governments and professional bodies have resulted in Germany’s acceleration of green steel decarbonisation compared to the rest of the world. The Federal Government’s, The National Hydrogen Strategy which was adopted into government in June 2020 suggests laying the foundation for the market penetration of hydrogen technologies is imperative for the Germany’s steel industry. The government believes hydrogen produced using renewable energy, or green hydrogen to be sustainable in the long term. Various government funding programmes, studies and projects are supported by the German government. Some include, Use of Hydrogen in Industrial Production, The National Decarbonisation Programme, The Carbon2Chem research project, and Regulatory Sandboxes for the Energy Transition.

ThyssenKrupp 

Thyssenkrupp Steel plans to reduce its carbon emissions by 30% from 2018 to 2030 and achieve net zero carbon emissions by 2045. Thyssenkrupp accounts for 2.5% of Germany’s CO2 emissions, mostly from its Duisburg blast furnaces. The company will gradually transition its BF/BOF steelmaking and utilise carbon capture, this two-path strategy will require total investment US$12bn and be completed by 2045.

On the first path, Thyssenkrupp will use green hydrogen where possible for its blast furnaces in the short term (2019-2023) and gradually transition its four coal-fired blast furnaces to four green hydrogen DRI units paired with four electrical melting units. These DRI and melting units can be paired with a basic oxygen furnace, much like in traditional blast furnace steelmaking.

Thyssenkrupp will replace one blast furnace with a 1.2Mtpa DRI plant running on natural gas, and later green hydrogen, paired with a melting unit from 2025. Another blast furnace will be replaced by 2029 and all four will be replaced by 2045 (Duisburg’s current crude steel capacity is 11.5Mtpa). Thyssenkrupp believes 0.72Mtpa of hydrogen will be required for this strategy, equivalent to that produced by 3,800 wind turbines. 

The second path will use Carbon2Chem, a carbon capture and utilisation technology, to capture unavoidable carbon emissions from the basic oxygen furnaces and convert them to methanol for the chemicals industry. Since 2016, the project has received US$67m from the German federal government, and from 2020 on, another US$88m will be added.

ThyssenKrupp will commence its decarbonisation path in 2025 with a 1Mtpa EAF type meltshop, this will be followed by a further 2Mtpa EAF type meltshop in 2035. The remaining transition of 8.5Mtpa of BF/BOF steelmaking equipment will be phaseout over 2040 and 2045. The company has also been conducting ongoing test for the use of hydrogen in its blast furnace since 2019. ThyssenKrupp’s climate-neutral steel will be known as Bluemint steel. The company expects to produce between 50-500kt from 2022-2024 and further ramp up Bluemint steel production to 3Mtpa by 2030.

ArcelorMittal

ArcelorMittal will reduce their CO2 emissions in Europe by 35% by 2030 and reach net zero by 2050. At ArcelorMittal’s Hamburg facility the site currently operates an EAF mini mill with a 1.3Mtpa meltshop. The facility will be Europe’s only DRI/EAF plant when the switch is made to using hydrogen from natural gas, with production of 100kt of H2-DRI expected in 2025. The federal government has also contributed US$58m in funding, equating to half of the total cost

ArcelorMittal has partnered with Energy company RWE in June 2022 for the development of offshore wind farms and hydrogen facilities. The renewable energy will be used to decarbonise its steelmaking assets in Germany, including Bremen, Hamburg, Eisenhuttenstadt and Duisburg. Green steel will be produced by replacing coal with wind power and green hydrogen as its main energy source. ArcelorMittal Germany is planning large-scale hydrogen-based DRI-EAF steelmaking in Bremen and a smaller pilot plant in Eisenhuttenstadt. The sites will produce 3.5Mt of green steel between them by 2030, saving 5Mt of CO2 emissions. The conversion will cost US$1.2bn-US$1.8bn.

Saarstahl

Saarstahl’s climate initiatives are aligned with the Paris Agreement. The company expects to reduce its carbon emissions by ~55-60% by 2030, from a base year of 2020. Saarstahl will transition its Voelklingen and Dillingen sites from 2027 and complete the entire decarbonisation and be carbon neutral by 2045. One blast furnace will be closed in Dillingen during the transition phase, which will result in a reduction of carbon emissions. To reduce its carbon emissions the company plans to use hydrogen rich gases in the blast furnace from now until 2028. Up until 2030 Saarstahl will commission a DRI plant with capacity of 2.5Mtpa in Dillingen. Two EAFs with total capacity of 3.5Mtpa will be installed at both Volklingen and Dillingen. Once operational this is expected to reduce carbon emissions by 60%. By no later than 2045 the company will commission another EAF with capacity of 1.2Mtpa. By this time, Saarstahl will increase the use of hydrogen, subject to its availability and economic efficiency.

The main steel producing companies in Germany which have announced their green transition plans include ArcelorMittal, DHS Dillinger Hutte, Huttenwerke Krupp Mannesmann (HKM), Saarstahl, Salzgitter and ThyssenKrupp. AME estimates a total crude steel capacity of 31.7Mtpa of green transition will take place in Germany from 2025 to 2045. 42% of this transition will be realised by 2030. AME expects total investment required for these companies to fully transition to green steel by 2045 is US$30.6bn. This is calculated as the average 1Mtpa of green steel capacity equates to an investment of US$965m. 

Salzgitter

Salzgitter plan to reduce their carbon emissions by 30% by 2030, and 95% by 2033, from a base year of 2018. Their green strategy consists of SALCOS - SAlzigitter Low CO2 Steelmaking. This has been successful in recent times with the company partnering with Mercedes Benz since July 2021 for supplying green strip steel with a reduced carbon footprint at four of their German plants to be used for structural and body parts. Likewise, Stalzgitter partnered with Miele in October 2021 for low carbon steel to be used for stoves and ovens. Salzgitter suggests its CO2 footprint of green steel for its galvanised material is 66% lower compared with the conventional production of steel via the blast furnace method.

The company will progressively convert to EAF steel production from 2025 with a 1.9Mtpa meltshop capacity at its Flachstahl facility. This will entail similar transition stages of 1.9Mtpa meltshop capacity in 2029 and 2033. In July this year the Board approved US$769m for the first stage of the transition to enable 1.9Mtpa of low CO2 crude steel by replacement of a blast furnace and a converter. It has constructed a pilot natural gas and hydrogen-powered DRI plant in Salzgitter that will begin production in early this year. Eventually, the company will replace blast furnaces with hydrogen-powered DRI units with the first large unit to commence operation in 2026. Salzgitter has constructed a 30MW wind farm for US$59m which will provide green electricity to produce green hydrogen from water electrolysis, as in the GrInHy2.0 and WindH2 projects. Total electrolyser capacity will be 100MW towards the end of 2025 and an option for additionally 400MW capacity by the end of 2030.