Iberdrola, H2 Green Steel announce €2.3B hydrogen project

H2 Green Steel (H2GS) and Iberdrola will build a 1 GW plant to produce Green Hydrogen to feed a 2-million-tonnes direct reduction tower, enabling green steel production.

Both partners have agreed to establish a green hydrogen production facility with 1 GW electrolysis capacity and a DRI process capable of producing around 2 million tonnes/year of direct reduced green iron to be processed for making flat steel. The electrolyser will be jointly owned and operated by Iberdrola and H2 Green Steel.

The plant will be constructed in the Iberian Peninsula, with production in 2025 or 2026. All potential locations under consideration for the site have access to cost-effective renewable electricity and the required infrastructure.

Iberdrola will deliver renewable energy to the plant, while H2 Green Steel will own and operate the DRI production, including any downstream green steel production processes.

The project would require around €2.3 billion investment which will be financed with a combination of public funding, green project financing, and equity.

Henrik Henriksson, CEO of H2 Green Steel, said, “Large-scale Green Hydrogen production will be key to enable the transition of heavy industry towards sustainable operations.”

Aitor Moso, Director at Iberdrola, added, “With access to abundant supplies of low-cost renewables, and a highly-skilled workforce, the Iberian Peninsula can be central to Europe taking a global lead in the development of this new green technology.”

Kajsa Ryttberg-Wallgren, EVP at H2 Green Steel, commented, “Our project in Boden in northern Sweden has proved that there is a very strong demand for green steel from a broad customer base.”

Millán García-Tola, Iberdrola’s Global Hydrogen Director, noted, “The challenge of achieving net-zero demands both vision and action across many industrial sectors.”