To meet climate goals, Germany is spending €5bn ($6bn) to reduce carbon emissions from the steel industry. The financing will go towards supporting hydrogen production projects and technological research and development. Germany may invest more than €35bn by 2050 in its effort toward carbon neutrality.
The investments will also support infrastructure to accelerate the conversion of mills towards low-emissions production, said Peter Altmaier, Germany’s Economy Minister. Altmaier noted the steel industry was essential to the country but also the largest emitter of greenhouse gases as 1.85mt of carbon dioxide is produced per 1mt of steel produced. Innovation in steel production mills will be promoted to secure 800,000 positions as steel companies are willing to make the necessary upgrades but need state assistance for financial viability.
A transition to hydrogen from coal to heat furnaces is essential in the investment plan. Germany’s thyssenkrupp AG has estimated it would cost around €10bn to transform its steelworks to hydrogen production.
According to Worldsteel, the industry is accountable for 8pc of annual carbon emissions. Germany is the EU’s largest carbon dioxide emitter at over 150kg per unit of GDP, followed by Italy, Spain, and the UK with each about 120-125kg and trailing France at 100kg.