The Spanish energy giant Iberdrola and Swedish steel manufacturer H2 Green Steel have announced a €2.3bn (c.£1.95bn) deal to construct a 1GW hydrogen electrolyser.
The companies plan to put the plant into operation by 2025 or 2026, and have started considering ‘several possible locations’ in Spain and Portugal for construction.
The site will also produce approximately two million tonnes of ‘green’ steel per year – fuelled by hydrogen.
In addition to their own investments, the partners will also seek financing from EU funds, green project finance, and equity.
Kajsa Ryttberg-Wallgren, H2 Green Steel’s executive vice-president and head of hydrogen, said: “Our project in Boden in northern Sweden has shown that there is a strong demand for green steel from a broad customer base.
“The collaboration with Iberdrola will strengthen and refine our Boden platform, infrastructure and project execution.”
Aitor Moso, Iberdrola’s director of deregulated businesss, said: “Green hydrogen will be a key technology in the decarbonisation of heavy industrial processes, such as steel production.
“Innovative projects such as this will help accelerate the commercialisation of larger and more sophisticated electrolysers, making green hydrogen more competitive.
“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.”
Henrik Henriksson, H2 Green Steel CEO, said: “Large-scale green hydrogen production will be essential for heavy industry’s transition to more sustainable ways of operating.
“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.”
Currently, the total capacity of operational hydrogen electrolysers equates to 0.3GW. The EU aims to encourage development of 40GW of electrolysers by 2030.
Image credit: jamesteohart/Shutterstock
Read next: 50MW UK solar farm gets the nod
Are you a building professional? Sign up for a FREE MEMBERSHIP to upload news stories, post job vacancies, and connect with colleagues on our secure social feed.