Vattenfall backs hydrogen to decarbonise heavy industry, eyes supply chain ownership


Vattenfall believes hydrogen created from renewable power could decarbonise heavy industry such as steel and cement production – and the firm wants to own the supply chain from generation to storage.

CEO and president Magnus Hall told the Aurora Spring Forum that “fossil-free steel on a full scale will, I think, be deployable between 2030 and 2035”.

While a “huge investment” and change for industry, Hall said Vattenfall was engaged with Sweden’s major manufacturers around decarbonising processes.

He suggested while climate change has perhaps been sidelined by global political issues, it will “come back big time”, with companies aware of the need to clean up.

“I think in the future, if you are not sustainable as a company, you will be punished,” said Hall.

Hydrogen sonata

Vattenfall is involved in a trial to replace coking coal in ore-based steel making with hydrogen and is building a test plant.

The firm has also struck a deal with pulp and paper firm Preem to use hydrogen to create biofuels from forestry bi-products.

Hall said Vattenfall also has designs on decarbonising the “huge” German chemicals industry.

Decarbonising heavy industry using renewables to create hydrogen via electrolysis would require not just vast amounts of renewable power, but adjacent infrastructure.

Hall said Vattenfall intends to build the whole lot.

“We see Vattenfall doing the electricity production, the hydrogen splitting and storing the hydrogen – which is complex.”

While the costs of offshore wind are falling fast, Hall called for the continuation of market stabilising subsidies such as the contract for difference scheme (CfD), which guarantees power prices.

He also said industry would have a role to play, not only in terms of appetite to change processes, but to support renewables deployment through power purchase agreements.

“We know how to handle merchant risk, but to drive develop of renewables, we really need this big cooperation [between utilities, industry and government] to make the shift happen.”

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