Iberdrola (OTCMKTS: IBDRY), a Spanish multinational electric utility company, is set to partner with Sweden’s H2 Green Steel to build a hydrogen plant that features an installed capacity of 1,000MW. Similarly, other big-name companies have also taken an interest in the sector.
The new plant, which is estimated to cost USD2.6 Billion, is set to provide clean fuel to power a direct steel reduction furnace that can produce about 2 Million tonnes of green steel per year. The introduction of clean power will reduce CO2 emissions by 95%, according to the company. Financing will stem from a combination of equity, green project financing as well as public funding.
“Large-scale green hydrogen production will be essential for heavy industry’s transition to more sustainable ways of operating,” said Henrik Henriksson, CEO of H2 Green Steel.
“By sharing the common goal of reducing emissions in hard-to-decarbonise industries, starting with steel in Europe, we are taking a truly global and innovative approach to green hydrogen production. Iberdrola brings invaluable experience, technology, and know-how, which will enable us to scale up our green steel projects”
The facility by Iberdrola and H2 Green Steel will be located on the Iberian Peninsula, though no specific area has been determined. Production is lined up to begin in 2025 or 2026.
According to Aitor Moso, Iberdrola’s director of deregulated business, “Green hydrogen will be a key technology in the decarbonisation of heavy industrial processes, such as steel production.”
“With access to low-cost renewable energy supplies and a highly skilled workforce, the Iberian Peninsula can play a key role in Europe taking a global lead in the development of this green technology.”