We present an embedding technique for metallic systems that makes it possible to model energy dissipation into substrate phonons during surface chemical reactions from first principles. The separation of chemical and elastic contributions to the interaction potential provides a quantitative description of both electronic and phononic band structure. Application to the dissociation of O2 at Pd(100) predicts translationally “hot” oxygen adsorbates as a consequence of the released adsorption energy (ca. 2.6 eV). This finding questions the instant thermalization of reaction enthalpies generally assumed in models of heterogeneous catalysis.