ZF has concluded a long-term agreement for Swedish start-up H2 Green Steel to supply 250,000 tons of steel per year from 2025 onwards, accounting for 10% of ZF’s current steel requirements
ZF directly and indirectly processes around 2.5 million tons of steel per year worldwide, and as part of its efforts to further reduce its carbon footprint, ZF is purchasing sustainably produced materials. The latest development is that ZF has concluded a long-term supply agreement with H2 Green Steel (H2), a Swedish start-up. From 2025 through to 2032, H2 will ramp up and supply ZF with 250,000 tons of steel annually from its production plant in northern Sweden. This order accounts for 10% of ZF’s current steel requirements and is projected to save around 475,000 tons of CO2 per year.
H2 was launched in 2021 with the aim of accelerating the decarbonisation of heavy industries, starting with the steel industry through new production processes and technologies, and by using green hydrogen. The steel will be produced in a fully integrated production process, using end-to-end digitalisation, electricity from renewable energy sources, and green hydrogen instead of coal. In traditional steel making, iron ore is reduced by heating it together with coal, utilising a chemical reaction that separates the oxygen from the iron, forming and emitting CO2. In H2’s production process, green hydrogen reacts with iron ore similarly to carbon, resulting in the extraction of oxygen. However, instead of creating CO2, the main by-product is water.
“With the introduction of low-CO2 production processes and sustainable products, the steel industry is in the midst of a profound transformation. Innovative companies with new concepts are in demand. We are supporting this transformation through our long-term supply relationship with H2 Green Steel,” stated Daniele Pontarollo, head of ZF Group’s materials management. ZF is also in dialogue with other steel suppliers to explore opportunities for sourcing more green steel.