Thyssenkrupp's Green Steel Plant Faces Potential Price Hike - Expensive Construction Possible for Thyssenkrupp's Green Steel Facility
In Duisburg, Germany, Thyssenkrupp Steel's ambitious green steel plant project is underway, with construction costs and operational expenses posing significant challenges. The project, a direct reduction plant (DRI) valued at over one billion euros, is being jointly managed with SMS Group from Mönchengladbach.
According to the project leader, Ulrich Greiner Pachter, the operating costs, particularly energy expenses and the availability of affordable green hydrogen, are the greater concern for the DRI plant. Securing enough green hydrogen at competitive prices remains uncertain, and energy costs are projected to be a critical factor in the plant's economics.
In 2025, Thyssenkrupp paused its hydrogen procurement tender due to high bid prices exceeding €9/kg, more than double the forecasts for 2030. To manage this, the company plans a two-step approach: initially operating the plant using natural gas, which reduces CO₂ emissions by 50% compared to traditional blast furnaces, before transitioning fully to carbon-neutral steel production by 2045 powered by green hydrogen.
The German federal government and North Rhine-Westphalia have promised up to €2 billion in public funding for the DRI plant, complementing Thyssenkrupp’s planned €1 billion own contribution for the project. However, Greiner Pachter has acknowledged that cost increases for the green steel plant construction cannot be completely ruled out and that a "risk buffer" has been included in the project plans to cover potential additional expenses.
In summary, Thyssenkrupp’s green steel plant could face rising capital expenditure risks and substantial operational cost challenges driven mainly by energy and green hydrogen pricing and availability in the coming years. Not everything runs smoothly on the construction site every day, as Greiner Pachter admitted, but the company remains committed to its green transition goals.
The employment policy for Thyssenkrupp's green steel plant project may need to accommodate potential cost increases due to the uncertainty in securing affordable green hydrogen and the projected critical role of energy costs in the plant's economics. The influx of public funding, combined with Thyssenkrupp's private investment, will impact the job market in the EC countries' steel, finance, and energy industries, potentially creating new opportunities for skilled professionals in these sectors.
