German steel producer Salzgitter AG has entered into a long-term agreement with energy company EWE AG for the supply of green hydrogen, marking a significant step toward decarbonising steel production in Europe.
Under the contract, EWE will supply approximately 10,000 tonnes of green hydrogen annually from its planned electrolysis facility in Emden, Germany, starting around 2030. The agreement spans seven years and is expected to support Salzgitter’s transition to low-carbon steelmaking under its SALCOS® (Salzgitter Low CO₂ Steelmaking) programme.
The hydrogen supplied will be used to replace fossil fuels in steel production through direct reduction of iron, a key process in reducing carbon emissions in the steel industry. Salzgitter aims to significantly lower CO₂ emissions as part of its broader industrial decarbonisation strategy.
In addition to external procurement, Salzgitter also plans to produce around 9,000 tonnes of green hydrogen annually in-house, thereby strengthening supply security and reducing dependency on third-party sources.
EWE’s hydrogen will be produced using large-scale electrolysis powered by renewable energy and integrated into Germany’s emerging hydrogen core pipeline network for distribution to industrial users.
The agreement represents one of Germany’s early large-scale green hydrogen offtake contracts, highlighting growing momentum in linking hydrogen production with hard-to-abate industrial sectors such as steel.
However, both companies noted that the success of such projects will depend on supportive regulatory frameworks, competitive renewable electricity pricing, and accelerated infrastructure development across Europe’s hydrogen value chain.
The deal is being viewed as a key milestone in advancing Europe’s industrial decarbonisation agenda, particularly in sectors where direct electrification remains challenging.
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