Salzgitter CEO urges Germany to pursue green steel ambitions despite setbacks
WirtschaftsWoche
Despite recent setbacks in its efforts to establish green steel production, Germany should continue its support for the transition to hydrogen-based industrial processes, said the CEO of steelmaker Salzgitter, Gunnar Groebler, according to business weekly WirtschaftsWoche. At an industry event, Groebler said that costs could not be the only determining factor for keeping the steel industry intact by supporting its transition.
“This is an industry that should have a place in Europe and Germany for more reasons than economic viability,” said the CEO. The company has invested heavily in decarbonisation and aims to become emission-free at its main plant in Salzgitter by 2027 by replacing furnaces with so-called direct reduction plants.
Groebler said rising carbon prices would mean that conventional furnaces can no longer be operated profitably by the mid-2030s at the latest, challenging the competitiveness of European steel producers. There was a “duty to society to reduce CO2,” the CEO said, adding that companies have to ensure that “this can be done in an economically viable way.” The alternative would be shuttering European plants and importing steel from abroad, which, according to Groebler, would be the “most simple and least thought-through solution that comes with significant consequences.”
As an input product, steel was the basis of many industrial processes and therefore a strategic sector, the CEO argued. The German government should therefore ensure that power prices and grid costs are lowered and that the hydrogen market is ramped up. “We have entered this path,” Groebler said, urging economy and energy minister Katherina Reiche to take into account that companies willing to make the transition can only do so when there is stability through government support programmes and broader energy policy strategy.
Steelmaker ArcelorMittal in the previous week announced it would drop plans for converting two plants in the country, in Bremen and Eisenhüttenstadt, to carbon-neutral production. Despite being entitled to subsidies worth about 1.3 billion euros, the company argued that energy costs in Germany were too high to allow for profitable operations.
