Groundbreaking Swedish 17 megawatts plant enables large-scale production of hydrogen

Ovako, together with Volvo Group, Hitachi ABB Power Grids Sweden, H2 Green Steel, and Nel Hydrogen, will become the first in the world to heat steel with hydrogen prior to rolling. And, it’s expected to open in a little more than a year.
September 01, 2021

A subsidiary of Sanyo Special Steel and a member of Nippon Steel Corporation group, the third-largest steel producer in the world, Swedish Ovako develops high-tech steel solutions for the bearing, transport, and manufacturing industries.

— Our production facilities in Scandinavia include sites at Hofors, Hällefors, Smedjebacken, and Boxholm in Sweden as well as Imatra in Finland. It’s based on recycled scrap and includes steel in the form of bar, tube, rings, and pre-components, tells Göran Nyström, Executive Vice President with responsibility for marketing and technology.

The company is currently building Sweden’s largest fossil-free hydrogen facility. It’s located at their steel mill and hub — that has its roots in the mid-16th century and houses the research and development department that developed its famous IQ-Steel — in Hofors, a small town in Gävleborg County with around 7,000 inhabitants. 

— Our goal is to greatly reduce CO2 emissions, developing local industrial hydrogen production, and taking the first step towards a future hydrogen infrastructure for the transport sector. Not only will it be the first to heat steel with hydrogen prior to rolling and is the next major step towards carbon-neutral steel production. The technical solution will also enable large-scale and cost-effective production of hydrogen for applications like fossil-free freight using fuel-cell trucks. With installations at multiple locations, this could enable a network with locally produced fossil-free hydrogen available for the transport sector, says Nyström, adding,

— The electrolyzer for the production of hydrogen from water is expected to be completed by the end of 2022, provided that permits are secured as planned. The 17 megawatts (MW) plant will generate 3,500 cubic meters of fossil-free hydrogen per hour.

What will you use it for?

— The conversion to hydrogen will enable us to reduce our CO2 emissions for steel production in Hofors by 50 percent from already low levels. The investment of approximately SEK 180 million is supported by the Swedish Energy Agency. The goal is to establish industry-wide use of fossil-free hydrogen, expand awareness of the potential of this fuel, and achieve cost-effective production. A filling station for hydrogen-powered heavy vehicles is intended to be built beside the hydrogen plant. The long-term plan is for local hydrogen production to be used in all of our units where steel is rolled by 2030, provided that there is a good supply of fossil-free electricity. If adopted by steel producers around the world, this technique has the potential to save 300 million tonnes of CO2 annually, provided fossil-free electricity is available.

Hydrogen is certainly getting a lot of attraction now. How important will it become for the necessary transition? And what are the main challenges related to it?

— By replacing fossil fuels, green hydrogen will be critical to the transition of most industrial processes. The challenge is not only in the production of fossil-free hydrogen but also in establishing how it can best be used to achieve and control the high temperatures required to produce high-quality steel. Where direct electrification is not possible, green hydrogen is one of the complementary energy carriers which can support the energy transition towards a carbon-neutral future. This exciting project will test new value chains as well as providing knowledge about how an electrolysis plant can interact with the existing electricity network and become an important resource for its stability.

What’s next for you?

— For us it is important that we cooperate across industrial boundaries and invest in solutions that provide substantial and rapid climate benefits. Since 2015, we have reduced our CO2 emissions by 54%. We will now be the first steel company to show that it is possible to eliminate CO2 for heating steel before rolling and get even closer to climate-neutral production. As mentioned, the production is fully based on recycled steel scrap and in combination with our efficient processes together with Nordic electricity, our cradle-to-gate carbon footprint of supplied products is about 80% lower than the global average. We have established ambitious climate targets based on a roadmap to 2040 that includes a major focus on further reducing our own carbon footprint, Nyström concludes.