German steel manufacturer Salzgitter announced that it has delayed the later stages of the large-scale green steel project Salcos for three years. The target of the project is to cut CO2 emissions from steel production by utilizing hydrogen. The investment for this project is around EUR 2.5 billion, of which EUR 1 billion will be supported by government grants. 

The first stage of the project is to launch a 100 MW electrolyzer, the construction of a direct reduction plant, and an electric arc furnace. It is expected to slash carbon emissions by about 30% in the steelmaking of around 2 million tons beginning in 2027.

Now the second stage of the project is postponed. This stage aims to cut emissions in steel production by 95% in the year 2028-2089. The hydrogen development is much slower than expected so as the regulatory changes which were promised by the government have not yet been achieved, said Gunnar Grebler, CEO of Salzgitter.