With €1.322 billion in total funding, Niedersachsen and the German federal government are accelerating SALCOS - one of Europe’s most ambitious green steel projects and a strong opportunity for international investors.
Niedersachsen expands support for low‑carbon steelmaking at SALCOS
he transformation programme SALCOS (Salzgitter Low CO₂ Steelmaking) has reached a decisive milestone: Federal and state governments are increasing funding for the first expansion stage to a total of €1.322 billion, closing an identified financing gap and securing the project’s timely implementation. The European Commission approved the additional funding in early February 2026, ensuring legal certainty and enabling continued progress.
As one of Europe’s most significant industrial decarbonisation initiatives, SALCOS aims to reduce CO₂ emissions by up to 95 % by replacing the traditional blast‑furnace route with hydrogen‑based direct reduction and electric arc furnaces. The first expansion stage includes a 100‑MW electrolyser, a direct reduction plant, and an electric arc furnace, scheduled to begin operation from 2027.
The funding structure reflects a strong national commitment: two thirds are provided by the federal government, one third by the State of Niedersachsen. In addition, Niedersachsen previously allocated €96 million through a dedicated investment programme. Policymakers describe the funding increase as a vital step for climate protection, global competitiveness, and long‑term industrial value creation in the region.
- €1.322 billion total funding
- +€322 million in additional support
- Up to 95 % CO₂ reduction
- 100 MW electrolyser & hydrogen based steel production
With SALCOS, Niedersachsen positions itself as a leading hub for green industrial transformation -sending a clear signal to international investors seeking sustainable, future oriented production environments.