Germany's steel industry needs political support to cope with CO2-reduction – opinion
The German steel industry accounts for about one third of the country's total industry emissions, meaning that becoming carbon-neutral by 2050 comes with particular challenges to the sector and will require support by the state to be a success, Kevin Knitterscheidt writes in an opinion piece for business daily Handelsblatt. According to industry groups, modernising the steel companies' production facilities will require investments of more than 30 billion euros as well as a "secure and affordable" supply with renewable power to produce hydrogen and decarbonise production processes, he writes. "No company can achieve this on its own," Knitterscheidt says, arguing that policymakers have to ensure that sufficient wind power capacity is being set up in Germany and must trigger buyers of basic materials to favour climate-neutral suppliers. "Without this kind of planning security, most producers rightfully shy away from investments in decarbonisation," he writes, citing the example of ThyssenKrupp, where a row over the steel producer's emissions reduction strategy has contributed to the resignation of steel production head Premal Desai.
Many energy-intensive German companies, like ThyssenKrupp or chemical giant BASF, already have detailed plans for drastic emission cuts, but lack viable business models to implement them. Germany's coal exit, the European Green Deal, and a highly anticipated hydrogen strategy could provide much-needed stimulation, but many companies remain preoccupied with managing trade conflicts, digitalisation, structural changes and a slowing economy.