A long-term power supply agreement has been signed between Salzgitter Flachstahl and Iberdrola Deutschland as part of the Salzgitter Group's 'Partnering for Transformation' strategic mission, which is designed to bring together the German steelmaker with its customers to achieve climate targets.

Electricity is to be sourced from the 'Baltic Eagle' offshore wind farm currently under construction in the German Baltic Sea, the aim being for the wind farm to deliver wind power for virtually carbon-neutral steel, claims Salzgitter.

The deal means that Salzgitter has secured the delivery of 114MW of green electricity over a period of 15 years. The wind farm is scheduled to go online at the end of 2024.

Once commissioned, the Baltic Eagle facility, which is located roughly 30km northeast of the island of Rügen, will deliver an overall capacity of 476MW.

Sustainably produced energy from Baltic Eagle will serve to additionally secure Salzgitter's SALCOS Low CO2 steelmaking transformation programme with green electricity being used to produce green hydrogen, a core component of 'virtually carbon-neutral steel'.

"The collaboration envisaged with Iberdrola is another key component of our energy strategy. Our main aim is to secure our requirements for electricity from renewables for Salzgitter AG and for the SALCOS transformation programme in particular."

Gunnar Groebler, chief executive officer, Salzgitter AG.

Salzgitter Group is already an active partner for generating renewable energies. Ilsenburger Grobblech, for example, has been delivering plate in the onshore market for the wind energy sector since 1996 and increasingly for the offshore segment since 2010. The company's other products for wind turbines include HFI longitudinally welded steel, pipes, precision steel tubes for cable cars and large diameter pipes for offshore wind farm substructures.

"Under our integrated growth strategy, the co-operation with Salzgitter AG marks another important step for Iberdrola Deutschland on this important core market."

Felipe Montero, chief executive officer, Iberdrola Deutschland

Gunnar Groebler, Salzgitter AG's CEO commented that establishing sustainable production and process chains was becoming increasingly important for the company, its suppliers and its customers. "By concluding this PPA, we have taken another big step toward climate-neutral production," he said.

Iberdrola Deutschland's CEO, Felipe Montero, commented: "Through strong partnerships and long-term PPAs, we are contributing, among other undertakings, to the transformation of Germany's industry, while also supporting the ramping up of green hydrogen in the market." He said that it was the company's intention to work alongside other key players in the German business arena and support them in achieving their climate targets with economically viable solutions in the market, such as PPAs.

Iberdrola Deutschland is the largest operator of offshore wind farms in the German Baltic Sea and is active in the planning, construction and operation of onshore wind farms and photovoltaic projects.

The Wikinger offshore wind farm, which was connected to the grid in the German Baltic Sea in 2017, will be joined by the aformentioned Baltic Eagle (2024) and the Windanker (2026).

According to Iberdrola Deutschland, entering into partnerships with leading German companies like Salzgitter Group is part and parcel of the company's growth strategy in the important core market of Germany.