With the increase in costs for CO2 emissions, gray steel will also become more expensive

The price gap between green and conventional steel will narrow by the 2030s. This was stated by Thyssenkrupp CEO Miguel Lopez, according to S&P Global.

As Lopez noted at an open shareholders’ meeting, customers of Thyssenkrupp’s German steel division will realize that prices for green steel will be higher, especially after it is produced using green hydrogen. However, he believes that as the cost of carbon emissions increases, conventional steel products will also become more expensive.

Green hydrogen will become one of the main cost items. Thyssenkrupp intends to launch its new direct reduced iron (DRI) plant, which will replace one blast furnace, to run entirely on hydrogen by 2029. The company will finalize tenders for the latter this year.

Lopez expects Thyssenkrupp to establish more hydrogen joint ventures (JVs) in the coming years.

The company also considers the availability of energy to decarbonize steel production to be a key issue, an aspect that has been questioned by the company’s shareholders. According to Lopez, this is why Thyssenkrupp is in favor of a joint venture with the Czech EPH. He did not elaborate on the current negotiations. However, the company’s CEO said that Thyssenkrupp would still consider Plan B if the joint venture fails, but did not say what the alternative would be.

Thyssenkrupp is still planning to spin off its steel division, and the company is investing €3 billion in its decarbonization, including €2 billion in support from the German government.

As GMK Center reported earlier, the weakening global steel market is complicating Thyssenkrupp’s negotiations on the possible sale of part of its European steel division to Czech billionaire Daniel Kretinsky.

Also, Thyssenkrupp is preparing a tender for the purchase of up to 151 ktpa of renewable and low-carbon hydrogen under 10-year contracts for expected volumes starting in 2028 for its Duisburg steel plant.