Fossil-free steel a giant step in Scania's decarbonisation
“Now we are gearing up in our journey towards completely emission-free products!”
This is how Scania’s Head of Purchasing Anders Williamsson sees the company’s decision to invest in and enter into a partnership with the company H2 Green Steel (H2GS). At this completely new steel plant in Boden, in northern Sweden, carbon dioxide emissions per tonne of steel produced can be reduced by 95 percent thanks to a new production method and the use of hydrogen gas produced from electricity from hydropower and wind power.
Anders Williamsson, who has been responsible for Scania's negotiations with the newly formed company H2GS Green Steel, is enthusiastic. He thinks that the investment will strengthen both Sweden's position, and Swedish industry's position, as a leader in decarbonisation.
Business model based on close partnerships
“Of course, this also strengthens Scania's position as a leader in the transition to sustainable transport. Since each Scania truck contains around 5 tonnes of steel, we can use steel manufactured with H2GS technology to take a giant step in our journey towards products that are emission-free throughout the value chain. It is a real increase in ambition that will not only contribute to Scania being able to deliver on the climate goals in the Paris Agreement, but actually raise the bar further,” says Anders Williamsson.
H2GS is built on the experience and lessons learned from the establishment of battery manufacturer Northvolt. The business model is based on a close partnership with strategic customers, including a deep collaboration on product development, process technology, recycling strategies and logistics.
“One of the important success factors for H2 Green Steel is to bring in heavy industrial players from the start, with whom we can do early joint product development. We now get this through Scania, which is a company with a clear ambition for the sustainability work in all parts of its operations,” says Carl-Erik Lagercrantz, Chairman of the Board of H2GS and Northvolt.
H2GS plans to start production in 2024
Scania's partnership with H2GS is based on the same successful concept as the collaboration with Northvolt.
“By investing in the start-up phase of the company, we manifest our confidence in the investment, at the same time as we are given good opportunities to, among other things, secure future deliveries,” Anders Williamsson explains.
H2GS plans to start production at the new steel plant in 2024. According to Anders Williamsson, production in Boden will comprise around 90 percent of the various types of steel and qualities that Scania demands.
“Of course, we will continue to buy steel from other suppliers in the future. Here, we follow the exiting development of fossil-free steel production that takes place in the ground-breaking Swedish HYBRIT project in collaboration between SSAB, LKAB and Vattenfall, Anders Williamsson concludes.