German government: EUR 2.6 billion funding for Saarland steel industry

Stahl-Holding-Saar with its subsidiaries Dillinger, ROGESA and Saarstahl is ready for the transformation to green steel production. The technological conditions and roadmap are in place. During his visit to Saarland today, Germany’s Minister for Economic Affairs and Climate Action Robert Habeck announced decisive results for the gigantic decarbonization project, that is unparalleled in Germany and Europe. Accompanied by Minister President Anke Rehlinger and a crowd of cheering representatives of Dillinger and Saarstahl, Habeck announced planned funding totaling EUR 2.6 billion – subject to approval by EU competition authorities.

“This is momentous news for Saarland’s steel industry. This enables us to make a historic transition in production – one that will cut carbon emissions by 55 percent by 2030. In doing so, we are performing a pioneering role in the decarbonization of the German steel industry while at the same time creating the conditions that will secure our competitiveness. What we are now doing here in the Saarland, in the steel industry, is a victory for climate protection, a first-class news for our customers and, all in all, a huge step towards the future of highly innovative steel production,” said Stefan Rauber, Chairman of the Management Board of SHS – Stahl-Holding-Saar GmbH & Co. KGaA and Chairman of the Board of Management of Aktien-Gesellschaft der Dillinger Hüttenwerke and Saarstahl AG.

Stephan Ahr, Chairman of the Group Works Council of SHS – Stahl-Holding-Saar GmbH & Co. KGaA, also thanked Habeck on behalf of the company and its employees for accepting the invitation to visit Saarland and for the chance to help shape the green future: “We are excited to see that our years of collective effort are now bearing fruit and that we will soon be able to start the ‘real’ work of building the production facilities that will make it possible to produce green steel in Saarland. This is of unparalleled importance in the history of the Saarland steel industry.”

The transformation project – with the Pure Steel+ brand – stands for climate neutrality by 2045. To achieve this, Dillinger and Saarstahl are focused on the use of hydrogen, on electric steel production and on recycling steel scrap. Taking the funding conditions into account, planning began this year for construction of a direct reduction plant and two electric arc furnaces (EAF) in Dillingen and Völklingen. Plans target production of up to 3.5 million tons of green steel annually starting in 2027/2028. To ensure that carbon emissions can be cut by 55 percent as early as 2030, the first step will be to convert up to 70 percent of production to a climate-friendly process.

The public funding that has now been announced is essential to managing the required investments of around EUR 3.5 billion. Plans call for up to 4.9 million tons of carbon-reduced steel to then be produced annually in Saarland.

Source and Photo: Dillinger