Swedish steelmaker Ovako to use hydrogen power for steel rerolling

Swedish steelmaker Ovako will install an electrolyzer for the production of fossil-free hydrogen at its site in Hofors, the company said on June 22. The 17 MW plant will generate 3,500 cubic meters of fossil-free hydrogen per hour and is expected to be completed by the end of 2022, provided that permits are secured as planned, the company said.

The new unit, once functional, will make Ovako the first in the world to use power generated from hydrogen to reheat steel before rolling.

The use of the hydrogen will enable Ovako to reduce its CO2 emissions during steel production in Hofors by 50%, the company said. The steel industry, which accounts for 7-8% of total CO2 emissions worldwide, has been under pressure to reduce its emissions as the EU strives for carbon-neutrality with net-zero greenhouse gas emissions by 2050, S&P Global Platts reported earlier.

Ovako produces around 400,000 mt/year of long steel products in Hofors, mainly for the automotive and mining industries as well as wind power sectors. Ovako produces around 1 million mt/year of steel products. The company targets to use the hydrogen that it produces in all of its steel rolling units by 2030.

The project, worth approximately SEK 180 million ($21 million) aims to establish an industry-wide use of fossil-free hydrogen. There are also good opportunities for cost-effective and large-scale use of hydrogen in other areas, such as transportation but it can also improve electricity grid stability, while the residual heat can be utilized in district heating networks, the company said.

The project is also supported by Volvo Group, Hitachi ABB Power Grids Sweden, H2 Green Steel, Nel Hydrogen and the Swedish Energy Agency.

“Decentralized hydrogen production in the steel industry fits very well with the transport industry’s need for fossil-free fuel. This technological solution is scalable because it can be used by the steel industry in large parts of the world. Working in partnership with other industries to be involved in the entire value chain around our transport solutions is essential,” said Lars Stenqvist, Chief Technology Officer at Volvo Group. A filling station for hydrogen-powered heavy vehicles is also planned to be built beside the hydrogen plant.

“This exciting collaboration will test new value chains, and we look forward to acquiring knowledge about how an electrolysis plant can interact with the existing electricity network and become an important resource for its stability,” said Jenny Larsson, Managing Director, Hitachi ABB Power Grids, Sweden.

— Annalisa Villa