Thyssenkrupp Steel under increasing pressure to go green
German conglomerate thyssenkrupp finds it increasingly difficult to spin off its troubled steelmaking division, Kevin Knitterscheidt and Martin Murphy write in Handelsblatt. In order to successfully sell off its core business, the group will have to reduce the amount of CO2 emitted by the unit. Customers, especially from the automotive industry, demand steel that is produced without CO2 emissions, Knitterscheidt and Murphy stress. In a recent letter addressed to employees, Bernhard Osburg, chairman of thyssenkrupp Steel Europe AG, said that the clean production of steel was essential for the division’s continued existence. "In no other area is time running out more than here," he wrote. Steel foundries, along with coal-fired power plants, are among the largest emitters of CO2 in Europe. Thyssenkrupp’s Duisburg site alone emits 20 million tonnes annually. With the tightening of environmental laws, the operation of blast furnaces will become impossible unless more hydrogen is fed into the production cycle, Knitterscheidt and Murphy note. Like other producers, thyssenkrupp has launched programmes to reduce CO2 emissions. The group aims to complete the switch by 2050. From the perspective of investors and customers, however, that target is way too far in the future. "We need green steel now," Handelsblatt quotes the head of a large German car manufacturer, who wanted to remain anonymous. Mercedes-Benz AG has recently taken an equity stake in Swedish startup H2 Green Steel (H2GS) as a way to introduce CO2-free steel into series production. Other manufacturers are following suit.
The German government said earlier this year that it would spend an additional 5 billion euros on the climate-friendly restructuring of the country’s steel industry between 2022 and 2024.