Despite numerous declarations, no one wants green steel, at least not at the current prices. German researchers have calculated the costs needed for green steel to become marketable.
Green steel in producers’ offers is currently 170–200 euros per tonne more expensive than traditional steel, and in extreme cases up to 300 euros. This price premium is holding back demand, particularly in the automotive industry, where green steel accounts for only a single-digit percentage of total steel purchases.
The price gap that stalls progress
The research, funded by the Hans Böckler Foundation and reported by Eurometal, aimed to determine the conditions under which green steel production could become economically viable in Germany and Europe while maintaining the region’s industrial competitiveness. According to the report, the profitability of direct reduced iron (DRI) production using green hydrogen requires a stable hydrogen price of around 140 euros per MWh until 2035, and electricity costs at 60 euros per MWh.
– The current price of green hydrogen on the Central European Gas Hub ranges from 130 to 190 euros per MWh – noted the authors of the report.
A roadmap to profitability for green steel
The researchers proposed targeted investment and demand-side support. This includes direct subsidies or low-interest loans covering up to 50% of investment costs for steel companies, with additional premiums for firms with collective bargaining agreements. Public funds should also play a larger role, with the state participating in strategically important steel enterprises to reduce capital costs.
Another form of support would be demand-side measures, such as favoring local producers in government procurement through local content requirements. The study also estimates that by 2050, EU demand for steel will be 160–180 million tonnes annually, with Germany needing to produce 40 million tonnes of climate-friendly steel per year. Currently, only 15 million tonnes of secondary steel (from scrap) are available, while primary steel plans amount to just 8 million tonnes.
Źródło: wnp.pl, Fot. Piotr Myszor / PTWP
