Following the funding commitments from the federal and state governments for Europe’s largest decarbonization project, the order for the central components is a major milestone on the way to a “green” future for Saarland’s steel industry.
The direct reduction plant will supply reduced iron pellets to the two production sites in Dillingen/Saar and Völklingen. The plant at the Dillingen site has an annual production capacity of around two million tons of direct reduced iron and is based on innovative Midrex Flex technology, which offers the flexibility to work with various mixing ratios of natural gas and hydrogen. Plant construction firms Primetals Technologies, Midrex Technologies Inc. and the DSD Steel Group have been commissioned to build the plant.
Electric Arc Furnaces
In addition to the DRI plant, the contracts for the electric arc furnaces (EAF) for Dillinger and Saarstahl have also been awarded. These plants will produce CO2-reduced steel from the iron pellets produced in the DRI plant with the addition of steel scrap. The EAF for heavy plate manufacturer Dillinger is also being built by Primetals Technologies and the DSD Steel Group. SMS Group was chosen to build the EAF for wire rod and bar manufacturer Saarstahl.
The DRI plant and two electric arc furnaces are the core components of the decarbonization project of Saarstahl, Dillinger and ROGESA, with a production capacity of 3.5 million tons of crude steel per year. The SHS Group is thus converting 70 % of its total capacity to CO2-reduced production in just one step.
With the use steel scrap and initial quantities of hydrogen, the systems enable carbon emissions to be cut by up to 55 % by the early 1930s. This corresponds to an annual reduction of 4.8 million tons of CO2. This means that these Saarland-based steel manufacturers are the only companies capable in the first step of achieving the EU’s “Fit for 55” climate target by 2030, if the corresponding infrastructure and economic efficiency are in place.
Preliminary Planning
Because of the complexity of the system configuration and the additional infrastructure, the SHS Group has carried out extensive preliminary planning for Power4Steel. As a result, an exceptionally advanced level of detail was achieved in the planning phase of the project in order to prepare for the smoothest possible construction phase. Commissioning is planned for 2028/29.
The total investment for the conversion to “green” steel production, including environmental design, infrastructure and logistics measures, amounts to around EUR 4.6 billion. The companies are receiving EUR 2.6 billion in federal and state funding for this pioneering project, with the remaining funding being provided by the companies themselves.
With the awarding of these contracts, Dillinger, Saarstahl and ROGESA are systematically pursuing the goal of climate-responsible production in Saarland. At the same time, they are laying the foundations for a future hydrogen economy in the Greater Region and thereby securing the future of the industrial location.
Stefan Rauber, Chairman of the Board of Management of Aktien-Gesellschaft der Dillinger Hüttenwerke and Saarstahl AG: “Today marks a decisive milestone for our decarbonization project. We are very glad to have strong partners at our side. We are making history in order to create the future. We will offer our customers at Dillinger and Saarstahl a high-quality portfolio of carbonreduced steel and overall become a pioneer of decarbonization in Europe. To accomplish this, however, we need the unwavering backing and support of policymakers. We are firmly committed to climate protection as well as to Germany and Saarland as a business location. For this reason, we expect an active industrial policy at all levels, which supports energy-intensive companies in Germany and creates internationally competitive conditions. Because industries that must produce significantly more expensively in Europe and in Germany must not suffer because they remain loyal to the location; companies that invest in Germany must also be supported by Germany.”