Global oil, gas, and energy major bp plc and Germany's largest steelmaker thyssenkrupp Steel Europe AG have announced the signing of a Memorandum of Understanding (MoU) focused on the development of the long-term supply of low carbon hydrogen and renewable power in steel production, helping accelerate the steel industry’s wider energy transition.
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According to a statement, the companies will explore supply options for both blue and green hydrogen, as well as power from wind and solar generation through the use of Power Purchase Agreements (PPAs).
The steel and energy industries have of course long been closely linked. We provide fuel and feedstock for steel production while our platforms, pipelines, and turbine towers are made from steel. thyssenkrupp Steel has the ambition to make its steel production climate-neutral by 2045 and low carbon power and hydrogen will play a critical role in achieving that, said William Lin, EVP Regions, Cities and Solutions at bp.
bp is working to pursue green hydrogen production at its refineries in Lingen in Germany, Rotterdam in the Netherlands, and Castellón in Spain.
It is developing both blue and green hydrogen production projects around the world, including in the UK and Australia.
As part of our strategy to provide a range of decarbonization solutions to corporates, bp is already investing in and working to develop a portfolio of industrial-scale hydrogen projects in Germany, the Netherlands, Spain, the UK, and Australia. With our aligned ambitions and complementary investments, thyssenkrupp Steel and bp can together help this hard-to-abate sector decarbonize faster, William Lin said.
Push for low-carbon hydrogen and green steel
Steel accounts for 8 to 11 percent of global carbon dioxide (CO2) emissions. It is essential for the automotive and construction industries and for the manufacturing of industrial machinery.
It also forms the foundation for a string of decarbonization technologies, including wind turbines, generators, and smart power grids.
The companies also intend to jointly advocate for policies that will support the development of low carbon hydrogen and the growth of green steel in Europe.
thyssenkrupp Steel Europe currently produces 11 million tonnes of crude steel per year and is targeting the production of 400 000 tonnes of CO2-reduced steel by 2025.
The decarbonization of the steel industry will require enormous quantities of low-carbon and in the long term green hydrogen. This will increasingly require the use of electricity from renewable sources, said Dr Arnd Köfler, Chief Technology Officer at thyssenkrupp Steel Europe.
All this can only be achieved through a well-developed hydrogen infrastructure with a supra-regional pipeline network. The MoU is an important milestone for us to set the course with bp for a reliable supply of energy in the future, ended Dr Arnd Köfler.
