Oldenburg/Bremen, 15 January 2024: The steel manufacturer ArcelorMittal Bremen and the energy service provider EWE want to jointly implement further hydrogen projects and thus advance the transformation of the region on the way to climate neutrality. In April 2023, ArcelorMittal Bremen, EWE and the EWE subsidiary swb laid the foundation stone for the construction of a 10-megawatt hydrogen production plant in Bremen. The electrolysis plant will form the basis for green steel production in north-west Germany. It is due to go into operation this year. ArcelorMittal Bremen and EWE have now signed a letter of intent to supply green hydrogen in large quantities. The aim is to significantly reduce CO2 emissions in steel production. The project represents a further milestone on the way to a fully decarbonised steel industry in Bremen. Green hydrogen from a 320-megawatt production plant in Emden is expected to be supplied to Bremen from 2028.
Stefan Dohler, EWE CEO, comments: "The energy transition will only succeed with the use of hydrogen. I am convinced of this. Producing hydrogen from renewable energies will create the conditions for making industrial processes such as steel production climate neutral. Hydrogen is therefore an indispensable component for achieving the climate targets that have been set and for linking the three sectors of energy, mobility, and industry. Together with partners, EWE is therefore planning projects along the entire hydrogen value chain and gradually implementing them - from production from renewables, storage and transport to application, especially in industry and heavy goods transport.
Frank Hohlweg, Chief Operating Officer and member of the Executive Board of ArcelorMittal Bremen, says: "Green hydrogen is an essential component for our future steel production in order to decarbonise our production. We are working hard to make the complete technology switch possible. To this end, our blast furnaces are to be replaced by new electric arc furnaces and a direct reduction plant in the future. In future, we want to use hydrogen instead of coal as a chemical reducing agent and thus further reduce CO2 emissions towards net zero. Until green hydrogen is available in sufficient quantities and at competitive prices, we are planning to use natural gas in the transition phase, which will already reduce emissions by more than 60 per cent. With the use of green hydrogen, we will then take the decisive step towards CO2 -free production."
Connecting large-scale project "Clean Hydrogen Coastline" as the basis
According to Stefan Dohler, the starting point for the large-scale production of green hydrogen for ArcelorMittal Bremen is the connecting large-scale project "Clean Hydrogen Coastline". This brings together production, storage, transport and utilisation in industry, thereby implementing the political requirements. EWE applied for funding for this large-scale project in February 2021 as part of the European IPCEI programme (Important Projects of Common European Interest) and reached the second stage of the process in May 2021. Funding is currently still being reviewed at European level.
ArcelorMittal has applied for national subsidies for the conversion of production technology from blast furnaces to electric arc furnaces with a direct reduction plant, which also still have to be approved by the EU Commission.
EU funding approval and swift federal funding necessary
Both managers agree that the projects require early funding approval at European level. The aim of the cooperation is to realise a ramp-up of the hydrogen infrastructure in Germany and the EU through early and courageous commitment. Long-term investment security for the realisation of major projects such as "Clean Hydrogen Coastline" and the conversion of production technologies is essential for this. The swift approval of funding by the EU Commission is a necessary legal prerequisite for this. Without a firm guarantee of funding, rapid provision of funding and fast approval procedures, companies will probably not be able to realise their projects, or not within the planned timeframe.
EWE plans to build up to 400 megawatts of electrolysis capacity at locations near the German North Sea coast that are beneficial to the system, from which up to 40,000 tonnes of green hydrogen can be produced annually, depending on the sales market. There is also the possibility of expanding production capacity to gigawatt scale in line with demand. The green hydrogen will also be used at ArcelorMittal Bremen. The hydrogen from the EWE plants is to be transported via hydrogen pipelines, which are being built as part of the large-scale "Clean Hydrogen Coastline" project, as well as the planned "HyPerLink" project of the long-distance gas network operator Gasunie. These pipeline connections are part of the planned hydrogen core network. The positioning of EWE's production facilities at important offshore connection points also makes it possible to integrate the import of green hydrogen.
Further joint hydrogen activities being implemented
In addition to the planned use of green hydrogen from EWE production plants in the north-west, the partners EWE and ArcelorMittal Bremen are already involved in other hydrogen projects. In April of this year, ArcelorMittal Bremen, EWE and the EWE subsidiary swb laid the foundation stone for the construction of a 10-megawatt hydrogen production plant. The electrolysis plant will form the basis for green steel production in north-west Germany. It is scheduled to go into operation in 2024 and will initially produce around 1,500 tonnes of hydrogen per year. In future, production volumes will be gradually increased into the three-digit megawatt range. This will save around 11,000 tonnes of CO2 per year. The lion's share of the green hydrogen will be supplied to the ArcelorMittal steelworks in the immediate vicinity of the electrolyser. The use of green hydrogen will reduce CO2 emissions at the steelworks.
ArcelorMittal has set itself the goal of producing climate-neutral steel by 2050. In Europe, CO2 emissions are to be reduced by 35 per cent by 2030. In order to achieve these targets, ArcelorMittal Bremen plans to replace the two blast furnaces with a direct reduction plant and two electric arc furnaces in two stages. After commissioning, the direct reduction plant is initially to be operated with natural gas and gradually converted to hydrogen operation. This will depend on the availability of generation capacity, infrastructure and economic and political conditions.