By Ed Frankl 
 

European Union lawmakers approved Tuesday a EUR1 billion ($982.5 million) German funding measure for steel company Salzgitter AG to decarbonize production.

Once operations start in 2026, the project is expected to avoid the release of 3.6 million metric tons of carbon dioxide annually through steel production using renewable hydrogen, the European Commission said in a statement.

The aid from the German state, in the form of a direct grant, will support the construction and installation of a direct-reduction plant and electric-arc furnace, replacing one of the blast furnaces currently operated by Salzgitter in the city of the same name in Lower Saxony, it said.

The measure will also help reduce dependence on Russian fossil fuels, the Commission said, imports of which have come under pressure since Russia's invasion of Ukraine.

 

Write to Ed Frankl at edward.frankl@dowjones.com

 

(END) Dow Jones Newswires

October 04, 2022 11:14 ET (15:14 GMT)

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