Credit: Salzgitter AG
Energy giant to provide 126,000 MWh of solar power a year to Salzgitter Group to help slash steel emissions
Octopus Energy has continued its European expansion drive, today confirming a major new deal to provide solar power to one of Germany's leading steel manufacturers.
The energy giant's generation arm announced it has inked a power purchase agreement (PPA) with Salzgitter Group, which will see it supply 126,000 MWh of clean electricity a year from the Schiebsdorf solar farm in Brandenburg.
The 10 year deal - financial details for which were not disclosed - aims to support Salzgitter's plans to transition towards low carbon steelmaking. It will provide the company with long term certainty over its electricity costs and enable it to slash the carbon footprint of the steel it produces by transitioning to hydrogen-based furnaces.
Salzgitter now plans to use an electrolyser powered by Octopus' solar farm to produce green hydrogen, which can replace fossil fuels in the steel production process.
The company is one of a number of leading steel manufacturers to pursue plans to slash emissions from the carbon intensive industry through the use of hydrogen, carbon capture, or electric arc furnaces.
Octopus acquired the Schiebsdorf solar farm last month, on behalf of the Sky fund (ORI SCSp), marking the latest step in the company's plans to invest more than €1bn in German clean energy infrastructure by 2027.
Alex Brierley, co-head of Octopus Energy Generation's fund management business, hailed the partnership with Salzgitter as "a significant leap towards decarbonising heavy industry and propelling Germany's clean energy transition".
"Germany's shift to net zero has many opportunities to get involved, and we're geared up to announce more deals very soon," he added.
Ralph Schaper, head of Salzgitter AG's Energy Economy Department, said: "As we work towards our strategic emissions reduction goal, this latest PPA adds another significant source of clean electricity to power our operations, create green hydrogen and ultimately produce greener steel for our customers. Octopus, with its extensive track record in European renewable energy, is an ideal long-term partner for us."
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