Thyssenkrupp Steel accounts for 2.5% of CO₂ emissions in Germany, mainly at its Duisburg facility. By replacing the coal-fired blast furnaces with direct reduction plants where iron ore is reduced with low carbon hydrogen, the company intends to make steel production climate-neutral in the long term.

Together with BP, it plans to explore supply options for both blue and green hydrogen for use in steel production, as well as power from wind and solar generation through the use of power purchase agreements (PPAs).

Commenting on the new venture, William Lin, BP’s Executive Vice President Regions, Cities and Solutions, says: ‘The steel and energy industries have been closely linked. We provide fuel and feedstock for steel production while our platforms, pipelines and turbine towers are made from steel. Thyssenkrupp Steel has the ambition to make its steel production climate-neutral by 2045 and low carbon power and hydrogen will play a critical role in achieving that.’

He continues: ‘As part of our strategy to provide a range of decarbonisation solutions to corporates, BP is already investing in and working to develop a portfolio of industrial-scale hydrogen projects in Germany, the Netherlands, Spain, the UK and Australia. With our aligned ambitions and complementary investments, Thyssenkrupp Steel and BP can together help this hard-to-abate sector decarbonise faster.’

Dr Arnd Köfler, Chief Technology Officer at Thyssenkrupp Steel, adds: ‘The decarbonisation of the steel industry will require enormous quantities of low carbon and, in the long term, green hydrogen. This will increasingly require the use of electricity from renewable sources. All this can only be achieved through a well-developed hydrogen infrastructure with a supra-regional pipeline network. The MoU [memorandum of understanding] is an important milestone for us to set the course with BP for a reliable supply of energy in the future.’

Steel accounts for 8–11% of global CO₂ emissions, according to the venture partners. It is essential for the automotive and construction industries and for the manufacture of industrial machinery. It also forms the foundation for a string of decarbonisation technologies, including wind turbines, generators and smart power grids.

Thyssenkrupp Steel currently produces 11mn t/y of crude steel and is targeting the production of 400,000 tonnes of CO₂-reduced steel by 2025. The company is planning to switch steel production to direct reduction technology, which is expected to avoid as much as 30% of CO₂ emissions by 2030, with the goal of making its steel production climate-neutral by 2045 at the latest.