Energy transition means integrated mills losing independence: thyssenkrupp

The technological transformation European mills are undergoing to make carbon-free steel will require additional sourcing of energy which mills, so far, have produced themselves, says the chief executive of thyssenkrupp Steel.

Speaking at the “Zukunft Stahl” conference organised annually by business daily Handelsblatt, Bernhard Osburg noted that integrated mills like thyssenkrupp meet two thirds of their power demand from their internal processes. To achieve the “net zero” for CO2 emissions, however, the mills must do without the off-gases they use for power generation, and must buy green energy from outside.

The company would thus need “to buy 45 terawatt hours of green power – that’s equivalent to three-and-a-half times the consumption of a city like Hamburg”, Osburg observed. This is also nearly one tenth of the 507 TWh consumed in Germany per year.

In this context, he noted that the enormous recent increase in energy prices, power as well as gas have already hit the company with an additional three-digit million-euro amount of extra costs. If it would depend on external gas and power in full at this stage, “we would have to switch the plants off because they would not be profitable”, Kallanish heard him say.

Osburg pointed out that the scenario of transforming to direct reduced iron production and buying power outside, means handing over some of the autonomy mills used to have. “After all, the charm of an integrated mill is that you have the entire production on-site,” he explained.

However, another large problem of the transformation is the availability of future energy demand in Germany. According to another speaker, Jürgen Barke of the Saarland economy ministry, Germany does not have the resources to generate these volumes in the country, and will have to look to other shores for imports.

Christian Koehl Germany