The EU Commission has approved German billions in aid for the construction of a large-scale plant to produce greener steel by Thyssenkrupp. Specifically, this is support of up to €2 billion, the EU Commission said.
The help is twofold. Subsidies of up to 550 million euros should flow towards the construction and assembly of the factory. The remaining up to 1.45 billion euros of aid are intended to finance a mechanism aimed at covering additional costs in the first ten years of operation of the new plant.
Thyssenkrupp is Germany’s largest steelmaker. In Duisburg, the company wants to build a so-called direct reduction plant that can be used to produce “green” steel. It will be operated on climate-neutral hydrogen and thus significantly reduce greenhouse gas emissions during steel production. The state of North Rhine-Westphalia and the federal government want to promote the plant, which is expected to come on stream in 2026. However, construction has yet to start.
58 million tons less CO₂
Initially, natural gas will be used to operate the plant. By 2037, natural gas will be completely replaced by renewable hydrogen. According to the EU Commission, the release of more than 58 million tons of CO₂ can be avoided during the entire lifetime of the plant.
Federal Economy Minister Robert Habeck (Greens) welcomed the aid approval. “It’s a very good day that shows that Germany, as an industrial country, has a green future,” said Habeck, who is on a business trip to India. The factory in Duisburg is one of the biggest industrial policy projects of the coming years. “It also proves the loyalty of energy-intensive industries to their location, saying that we want to stay in Germany, we want to transform here,” said the economy minister.
According to the EU Commission, Thyssenkrupp has committed to actively transfer the knowledge acquired during the construction and operation of the plant to science. In Germany, other steelmakers also want to build similar plants. In April, the company Salzgitter received a donation of one billion euros.