The German government will allow Thyssenkrupp Steel to adapt and slow the transition to hydrogen at its direct reduced iron (DRI)-based steel plant in Duisburg.
It follows talks with the German government around the project’s funding, with the firm claiming economic conditions and the availability of hydrogen had affected the TKH2Steel project’s switch from coal-based steelmaking.
While Thyssenkrupp said new funding conditions had been confirmed, it did not reveal the new funding criteria.
Chief Financial Officer, Phillip Conze, however, said the agreement gives the company “planning certainty” needed to proceed with construction.
Thyssenkrupp also said it maintains ambitions to ultimately run the plant solely on hydrogen, without disclosing a prospective timeline. Natural gas will be used in the interim, with blends of an increasing hydrogen concentration bridging the gap to fully hydrogen-fuelled operations.
The $3bn ($3.4bn), 2.5 million tonne per year facility was previously expected to begin using hydrogen in 2028 and reach full hydrogen operation in 2029. However, CEO Miguel Lopez warned of it becoming a stranded asset if Germany could not aid the transition.
Thyssenkrupp will launch a new long-term hydrogen supply tender “shortly” for the site on which construction is ongoing.
Steelmakers in Europe attempting to adopt hydrogen-based manufacturing have broadly been beset by the molecule’s high costs.
Projects including ArcelorMittal’s Bremen and Eisenhüttenstadt facilities, and Stegra’s Boden, Sweden, plant have encountered trouble in establishing direct reduced iron (DRI) steelmaking operations, with the former two projects being shelved.
One project making ground is Salzgitter’s 9,000 tonne per year Salcos project at its Flachstahl site, which is targeting start-up next year.
