Thyssenkrupp AG secured European Union approval for a €2 billion ($2.2 billion) package of state subsidies from the German government to invest in green steel production.
(Bloomberg) — Thyssenkrupp AG secured European Union approval for a €2 billion ($2.2 billion) package of state subsidies from the German government to invest in green steel production.
It comprises €550 million in direct grants and a conditional payment of as much as €1.45 billion to be used to support Thyssenkrupp’s bid to decarbonize its steel production and accelerate renewable hydrogen uptake, the European Commission said Thursday.
The German industrial company plans to produce climate-friendly steel at its site in Duisburg by the end of 2026.
A statement from the EU’s competition commissioner Margrethe Vestager said that Germany’s antitrust watchdog could “closely monitor” any potential distortions to the market that would arise as a result of the subsidy plan.
“This is a really good day, showing that Germany as an industrial country has a green future,” German Vice Chancellor and Economy Minister Robert Habeck said on the sidelines of a visit to New Delhi, two days before he’s due to attend a Group of 20 energy ministers’ meeting in Goa.
The subsidies will be a combination of investment grants and operating expense grants, he said.
Read More: Germany Fights to Green Production of Most Important Commodity
Germany and the EU commission reached an agreement over the subsidy package for Thyssenkrupp in June. The funding includes €700 million from the state government of North Rhine-Westphalia and around €1.3 billion from the federal government.
Green steel production typically uses hydrogen to purify iron ore pellets and then melts the metal with other minerals to create steel in electric-powered furnaces. The technique replaces coal-powered blast furnaces, which can spew out more than a ton of carbon emissions for each ton of steel.
Separately, the EU on Thursday approved €850 million of aid in France to support ArcelorMittal SA‘s steel decarbonization plans.
–With assistance from Samuel Stolton.
(Updates with German economy minister statement starting in fifth paragraph.)
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