FRANKFURT: German industrial group Thyssenkrupp is in advanced discussions to revise the funding framework for its €3 billion ($3.5 billion) green steel plant in Duisburg after changes in market conditions made the project’s original hydrogen-based production plan unviable.
The proposed changes would allow public funding for the project to continue despite delays in the planned use of hydrogen, with the revised framework requiring approval from German authorities.
Why is Thyssenkrupp seeking changes to the funding framework?
The original funding arrangement, under which roughly two-thirds of the project’s financing is provided by the German federal government and the state of North Rhine-Westphalia, was contingent on the plant initially operating with hydrogen. However, the company said current economic conditions have made that approach unrealistic.
Finance Chief Axel Hamann said the company had been working with Germany and the European Commission to modify the funding rules to reflect the changed circumstances.
What is the significance of the revised funding plan?
According to Thyssenkrupp, the European Commission has approved the proposed amendment and confirmed it complies with EU state aid rules, paving the way for Germany to formally update the funding decisions.
The revised framework is expected to ensure continued financial support for one of Germany’s flagship industrial decarbonisation projects while allowing the transition to hydrogen-based steel production at a later stage.