Stegra and Uniper have entered into a transformative agreement to ensure a reliable supply of electricity for Stegra’s pioneering plant in Boden, Northern Sweden. Under the terms of this long-term power purchase agreement (PPA), Uniper will supply 6 terawatt-hours (TWh) of electricity to Stegra over six years, spanning 2027 to 2032. This collaboration marks a significant step in the journey toward large-scale green industrial production in Europe.
Driving Green Industrial Transformation
Stegra’s state-of-the-art facility in Boden is poised to become a cornerstone of green industrial production. Set to commence operations in 2026, the plant will produce green hydrogen, green iron, and green steel at unprecedented volumes. The initial annual output is expected to reach 2.5 million tonnes of green steel. This ambitious initiative aligns with global efforts to decarbonize heavy industries and reduce greenhouse gas emissions.
The plant’s production process is deeply reliant on electricity to power its 700MW electrolysis facility. This facility will generate green hydrogen, a crucial component in reducing iron ore to green sponge iron, the raw material for producing green steel. The agreement with Uniper ensures that Stegra can secure a substantial portion of the electricity required for its energy-intensive operations, providing a stable foundation for its ambitious production goals.
The Partnership: Meeting Energy Demands for Sustainability
The collaboration between Stegra and Uniper represents a strategic alignment between two industry leaders committed to sustainability and innovation.
Johan Svenningsson, Country Chairman at Uniper Sweden, emphasized the company’s role in supporting the energy transition:
“We are proud to support the ongoing transition of the energy system by being a reliable and innovative partner to industrial off-takers.”
From Stegra’s perspective, the deal solidifies its position as a trailblazer in green industrial solutions. Arne Österlind, Head of Energy Portfolio at Stegra, highlighted the strategic importance of the agreement:
“The agreement with Uniper forms the base for a strategic partnership with a player which can provide us with long-term access to electricity for our plant in Boden, set to produce green hydrogen, green iron, and green steel at scale. This electricity delivery is central to our strategy and a key step towards accelerating reductions of industrial emissions in Europe.”
Securing Renewable Energy for Green Steel Production
The production of green steel is energy-intensive, requiring significant amounts of renewable electricity to achieve its low-carbon goals. Green hydrogen, produced via electrolysis, is the linchpin of this process. Electrolysis splits water molecules into hydrogen and oxygen using electricity, and when powered by renewable energy, it generates hydrogen without emitting carbon dioxide.
The hydrogen produced will be used to reduce iron ore to sponge iron, a process that avoids the use of fossil fuels. The resulting green sponge iron will then be fed into Stegra’s steel production facilities, creating high-quality steel with a minimal carbon footprint.
Through this agreement, Stegra ensures a steady supply of renewable electricity, a crucial element in meeting its operational needs and sustainability targets.
Accelerating Europe’s Industrial Decarbonization
This partnership also underscores the broader impact of industrial collaborations in reducing emissions across Europe. With heavy industries accounting for a significant share of global greenhouse gas emissions, initiatives like this serve as vital components of Europe’s climate strategy.
The Boden plant is part of a larger vision to revolutionize industrial operations by integrating renewable energy solutions and innovative technologies. By securing this long-term electricity supply, Stegra not only strengthens its operational capabilities but also reinforces its commitment to driving systemic change in the steel industry.
A Model for Sustainable Industry
The agreement between Stegra and Uniper exemplifies how partnerships can enable the large-scale transformation of industrial processes. It showcases the feasibility of aligning ambitious production goals with sustainability commitments, setting a benchmark for future industrial projects.
As the global push for decarbonization intensifies, collaborations like this will play an increasingly central role in creating a sustainable industrial landscape. By combining renewable energy with cutting-edge technologies, Stegra and Uniper are leading the charge toward a greener, more sustainable future.
This long-term deal is not only a milestone for both companies but also a testament to the potential of collaborative solutions in tackling the urgent challenges of climate change and industrial emissions.
