Salzgitter and EWE Sign Landmark Deal for Green Hydrogen Supply to Decarbonise Steel Production
Salzgitter AG and German energy company EWE have finalised a long-term agreement for the supply of green hydrogen, marking a significant step in the development of Germany’s hydrogen economy and the decarbonisation of industrial steel production.
Under the contract announced on 9 June 2026, EWE will supply around 10,000 tonnes of green hydrogen per year from its planned 320-megawatt production facility in Emden. The hydrogen will be delivered via Germany’s emerging hydrogen core network and is scheduled to begin flowing from 2030, subject to infrastructure readiness and certification requirements.
The agreement runs for an initial period of seven years and represents the first major offtake contract for hydrogen from the Emden plant, as well as Salzgitter AG’s first large-scale sourcing arrangement with a dedicated hydrogen producer. The volumes secured are intended to cover approximately 6.5% of the hydrogen demand for Salzgitter’s SALCOS programme, which is designed to transition steel production towards lower-carbon processes.
SALCOS, short for Salzgitter Low CO₂ Steelmaking, aims to progressively replace coal-based blast furnace operations with hydrogen-based direct reduction technology. The company says this approach could reduce emissions by up to 60% in earlier phases, with the long-term objective of achieving near climate-neutral steel production. At full scale, the system could consume up to 150,000 tonnes of hydrogen annually, with part of that demand met through Salzgitter’s own planned 100-megawatt electrolysis capacity.
The companies described the agreement as a milestone for Germany’s hydrogen ramp-up, highlighting its role in linking large-scale renewable hydrogen production with industrial demand for the first time at meaningful volumes. They said the deal demonstrates that supply and demand can be aligned ahead of full market maturity, helping to overcome what has been described as a “chicken-and-egg” barrier to investment.
However, both sides also warned that significant challenges remain before a fully functioning hydrogen market can emerge. They pointed to the need for stable regulatory frameworks, competitive electricity pricing for electrolysers and clearer certification rules under EU renewable hydrogen standards, known as RFNBO criteria. These rules govern additionality and timing requirements for renewable electricity sourcing and are seen as a key factor influencing production costs.
EWE said the project forms part of its broader hydrogen strategy, which integrates production, storage and transport infrastructure in northwest Germany. The company is also involved in the EU-backed Clean Hydrogen Coastline initiative, which aims to scale up hydrogen networks across the region.
Political representatives at the signing ceremony in Berlin described the agreement as evidence of growing industrial momentum behind hydrogen deployment in Germany, while also stressing continued public support for both hydrogen production and industrial conversion projects.
Salzgitter said the contract strengthens its SALCOS decarbonisation roadmap and positions the company as an early mover in hydrogen-based steelmaking, while EWE emphasised the agreement’s role in building confidence for further industrial hydrogen partnerships.
Although dependent on infrastructure development and regulatory progress, the deal is being viewed as an important early signal that large-scale hydrogen supply chains are beginning to take shape in Europe’s industrial heartlands.
