Modern hybrid video codecs split their video content into blocks. These blocks are predicted and the difference between original and predicted block is calculated. This residual block is transformed by a discrete cosine transform (DCT) from the pixel domain into the frequency domain and quantized by a dead-zone quantizer (DZQ), which removes high frequency signals, depending on the quantization parameter (QP). DZQ has an extended zone around zero, which acts as a noise-gate, removing noise as intended but also removing useful signals. DCT and DZQ are not the optimal solution, they create distortions and side effects at lower bitrates. In contrast, sparse coding does not have these problems at lower bitrates, but it compresses inefficient at higher bit rates. We propose a method to add sparse coding as an alternate transform, which is controlled by a rate-distortion optimization (RDO) decision, in a semi-extreme sparse coding (SESC) setup and uses a semi-extreme dictionary training (SEDT) process. It is integrated into the High Efficiency Video Coding (HEVC) test model HM-16.18 and screen content coding (HEVCSCC) test model HM-16.18+SCM-8.7. Experimental results demonstrate that the proposed method achieves a Bjontegaard rate difference (BD-rate) of up to 5.5% compared to the standard.