Green shift contingent on power guarantee: steelmaker

By Arctic Business Journal - November 25, 2022
SSAB managing director Martin Lindqvist wants his firm to go green by 2030, but is concerned there won’t be enough electricity for that to happen (📸: SSAB / Henrik Hansson)

SSAB, A SWEDISH steelmaker, has announced plans to decarbonise production at its European mills 15 years earlier than planned as it seeks to eliminate 90% of its carbon pollution by 2030, but warns the effort will fail unless it receives a guarantee from power producers that it will receive the electricity the new plants need.

Martin Lindqvist, the SSAB managing director, has previously stated that the plan was contingent on the availability of renewable energy to produce what is known as “green” steel. That was a message he reiterated last week when he criticised Svenska Kraftnät, the nationally owned electricity transmission system operator, for being unwilling to guarantee SSAB that it would supply it with the renewable energy it and other industrial producers needed to decarbonise their operations.

Svenska Kraftnät says it currently supplies power on a first-come, first-served basis, and that, Mr Lindqvist was concerned, could see activities such as bitcoin-mining receive power generated from renewable sources before vital industries such as steel-making and transport.

Instead, SSAB has called for Svenska Kraftnät to copy the Finnish practice of prioritising certain customers. Svenska Kraftnät says doing so is possible, but that it was a “complex issue” that it needed time to review before it could offer SSAB an answer.

“We are looking at it right now and aim to deliver an answer in a few months”, Daniel Gustafsson, a Svenska Kraftnät spokesperson, said.

SSAB’s decarbonisation plan calls for replacing existing steel mills in LuleĂĄ, Sweden, and Brahestad, Finland, with what are described as “integrated electric” steel mills, and associated rolling mills and finishing facilities.

Traditional steel production consumes large amounts of coal as part of the process that turns iron ore into iron. Green steel can be made using hydrogen and an electric arc furnace to melt the ore. SSAB intends to make this process “fossil-free” by using only electricity from renewable sources, such as hydroelectric (see video below).

According to SSAB, converting to hydrogen at its LuleĂĄ plant would eliminate 8 million tonnes of carbon dioxide emissions a year, or some 10% in Sweden’s total carbon pollution. Converting the Brahestad mill would cut that country’s carbon pollution by 7%.

Previously, SSAB had planned its 45 billion kronor (€4.2 billion) transition from carbon to hydrogren in the Nordic region by 2045, but increasing demand for products made from fossil-free technologies means it will accelerate the process.

This article has been fact-checked by Arctic Business Journal and Polar Research and Policy Initiative, with the support of the EMIF managed by the Calouste Gulbenkian Foundation.

Disclaimer: The sole responsibility for any content supported by the European Media and Information Fund lies with the author(s) and it may not necessarily reflect the positions of the EMIF and the Fund Partners, the Calouste Gulbenkian Foundation and the European University Institute.