Ørsted to supply steel maker Salzgitter with offshore wind and green hydrogen

Danish developer will supply offshore wind power and green hydrogen to steel maker Salzgitter in exchange for low-carbon steel

Salzgitter will supply Ørsted with low-carbon steel for components in its offshore wind farms
Salzgitter will supply Ørsted with low-carbon steel for components in its offshore wind farms

German steel maker Salzgitter and Ørsted have signed a memorandum of understanding (MoU) to establish closed value chains in their business relationships.

Under the MoU, the Danish developer will supply offshore wind power and green hydrogen to the steelmaker while using Salzgitter’s low-carbon steel in components for its offshore wind farms.

There are also plans to recycle scrap from decommissioned wind turbines into the steel production process.

A spokesperson for Ørsted was unable to disclose details of the volumes of offshore wind, green hydrogen or low-carbon steel involved, or a timescale for the partnership to take effect.

Ørsted aims to make its own operations climate-neutral by 2025 and to eliminate its indirect carbon emissions by 2040.

Gunnar Groebler, chairman of Salzgitter’s executive board – and former head of Vattenfall's business unit for wind – added: “Together with Ørsted, we’re showing that circularity is becoming a reality on an industrial scale.”

German wind farms due to power metal company's facilities 

European Energy and 595 Solutions have signed a five-year power purchase agreement (PPA), for 80GWh. The power will be sourced from European Energy’s German wind portfolio.

As a result, 595 – active in the aluminium and magnesium sectors – will be able to cover all of its German electricity consumption with renewable energy, it stated.

Arne Amann, COO of 595, welcomed the deal, and said: “As foundries are not only businesses with a very high energy consumption, we are also operating in a country with some of the highest energy costs in Europe”.

Many wind farm operators in Germany are turning to corporate PPAs following the expiry of their projects’ subsidies under the country’s Renewable Energy Sources Act (EEG).

Gregor McDonald, head of energy trading at European Energy, said the deal illustrated the continued financial viability of European Energy’s German wind portfolio, in the post-EEG subsidies era. “595 are thus directly contributing to keeping green assets in operation after the initial state support period is over”, he said.

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