Steelmaker Thyssenkrupp and energy provider RWE have announced a plan for hydrogen-based steel production by the mid-2020s as the undertaking is boosted by Germany's new hydrogen strategy, the companies said in a joint statement June 10. 

The collaboration aims to reduce CO2 emissions from iron production by using a 100-MW electrolyzer that could produce 1.7 mt of hydrogen an hour, which would cover 70% of the quantity needed by the blast furnace to produce 50,000 mt of steel. The conversion of the blast furnace is to be carried out by 2022 and the first hydrogen is planned to flow from RWE to Thyssenkrupp by "the middle of the decade." The companies agreed to use only renewable energy should be used to operate the electrolyzers.

"The aimed-for supply quantity would be broadly enough to supply a blast furnace with green hydrogen and allow the production of climate-neutral steel for around 50,000 cars a year," Thyssenkrupp Steel Chairman Bernhard Osburg said.

RWE and Thyssenkrupp said that the hydrogen strategy adopted by the German government would be a driver of the transformation toward hydrogen for steel production as the development of a dedicated hydrogen network to transport the hydrogen from RWE's Lingen plant to Thyssenkrupp's steel mill in Duisburg would be needed.

German steel industry body WV Stahl welcomed the government's new hydrogen strategy, saying the plan would help the steel industry on its way toward carbon neutral steel production.

WV Stahl welcomed the pilot program of "carbon contracts for difference" as part of the strategy which the German government decided would apply to the steel and chemical industries. The program will pay hydrogen projects the difference between the price of an EU carbon permit and the actual cost of cutting CO2.

"Carbon contracts for difference are an important instrument for the transformation. But they will only be effective if not just some but all the extra costs of investing in climate protection are covered. The detailed arrangements will have to be discussed further," WV Stahl President Heinz Juergen Kerkhoff said.