The European Commission has approved a national aid of 2.6 billion euros to help support Germany's use of hydrogen to decarbonize its struggling steel industry.

The European Commission stated that this direct grant will support Stahl Holding Saar, the controlling and managing company of the steel industry in Saarland, Germany, in using hydrogen to decarbonize the steel industry in the region. Decarbonization work is part of the EU's hydrogen strategy and flagship European green agreement, both of which are the cornerstone of the EU's net zero plan.

The funds will be used to build a direct reduction plant and two new electric arc furnaces. Electric furnaces that can operate using renewable energy will replace existing blast furnaces, which require fossil fuels to operate. The new direct reduction plant will ultimately use low-carbon and green hydrogen gas.

Margaret Vestag, Executive Vice President of Competition Policy of the European Commission, stated that decarbonization in the energy intensive steel industry is key to achieving green transformation. This € 2.6 billion German measure will support Stahl Folding Saar's decarbonization transformation of its Saarland steel production base. Meanwhile, this will help initiate the production of renewable hydrogen in Saarland.Editor/XingWentao