On the 1.5 °C pathway
March 03, 2026 | Reading time: 4 minutes
Salzgitter AG is in the midst of the largest transformation in its history: This is how SALCOS® is driving the decarbonization of the steel industry.
The future of steel production is emerging in Salzgitter. By implementing its SALCOS® (Salzgitter Low CO2 Steelmaking) program, Salzgitter AG is shifting to a new production route – replacing coal and coke with natural gas and, increasingly, hydrogen. Instead of the blast furnace, the direct reduction plant and electric arc furnace are operating flat out. And, instead of CO2, the site’s emissions in future will be steam.
What’s special is that Salzgitter AG has opted for carbon direct avoidance. This means that, instead of a complex carbon offsetting mechanism or storage technology, it is avoiding the emissions in the first place. In the direct reduction plant, hydrogen reacts with iron ore – and the resulting emission is steam, rather than CO2. The sponge iron achieved through this process is then made molten in the electric arc furnace to produce raw steel.
Tackling the challenges of climate change
This undertaking involves major alterations to the steelworks in Salzgitter – open-heart surgery, in effect, because the site’s operations remain ongoing. In 2027, Salzgitter customers should be able to purchase low-carbon steel via the new production route. “The market for green steel is increasingly established, as Martin Zappe, Program Manager states. “The Salzgitter Group has already concluded agreements on potential supplies with customers in sectors such as white goods, the automotive industry and cold-rolling mills.”
By pursuing this transformation, Salzgitter AG is actively tackling the challenges of climate change – as one of the first steel producers to join the 1.5 °C pathway set out in the Paris Climate Agreement, as advocated by the Science Based Targets Initiative (SBTi).
Building the future
The evolution of Germany’s largest transformation project
Every day, the new production facilities at the steelworks in Salzgitter edge closer to completion. The following images provide up-to-date insights into the progress of construction work over recent weeks and months – snapshots of a turning point in industrial history, following the 1.5 °C pathway.
The transformation zone at night: A view of the Group’s largest construction site – the SALCOS® transformation program.
Robust orange anchoring: The assembled hot metal crane for the electric arc furnace (EAF) not only lifts the heavy scrap-filled cages and empties them into the EAF for smelting but is also capable of changing the entire furnace vessel.
Ready for action: The highly specialized process crane is subject to extreme conditions and must withstand continuous operation.
Extraction, cooling and purification: The dedusting plant for the electric arc furnace (EAF) will process the high volumes of dust and flue gases produced in the EAF process.
At the core of the transformation: In the future, the direct reduction plant (DRP) will use natural gas – and increasingly, over time, hydrogen – to reduce iron ore to sponge iron. This process replaces the conventional blast furnace route, which is based on coal and coke and produces high CO2 emissions. The cooler – shown here being lifted by a crane – regulates the temperature of the sponge iron.
Control center: The DRP’s main power control building will house energy supply infrastructure and technology along with plant control systems.
A CO2 wash: The process gases produced are purified in the DRP. The captured CO2 can be compressed and either stored or used for other processes. The remaining gas flows back into the DRP.
A real eye-catcher: The plant’s tower dominates the landscape. In the future, hot reduction gases for iron ore smelting will flow into this tower. When completed, it will stand at 140 meters tall.
Rising high: The plant’s tower has grown with every component added.
The final meters: In December 2025, the DRP reached its final height, making its mark on the new skyline of Salzgitter AG.
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SALCOS® – program for Low CO2 Steel Production
SALCOS® is a program of Salzgitter AG, that promotes the production of green steel & green hydrogen through processes for climate-neutral steel production.
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