Volvo signs deal to buy “near zero emissions” steel that is not made from coal

Swedish trucking giant Volvo Group has signed a deal with H2 Green Steel to purchase near zero emissions steel for use in the manufacturing of commercial vehicles.

H2 Green Steel secured a €1.5 billion investment in early September to fund the construction of its flagship large-scale green steel plant in Boden. Groundworks have been ongoing at the site since the Northern summer of 2022, and H2 Green Steel expects to be able to begin producing the steel by the end of 2025.

Instead of using coal in the production process, H2 Green Steel will be using hydrogen, produced on-site with what is set to become Europe’s largest electrolyser, which itself will be powered by renewable energy.

“Steel is a big contributor to the footprint of our products, and working together with both established and new players for developing decarbonized materials is key to advancing our progress in sustainable transport and infrastructure solutions,” said Andrea Fuder, chief purchasing officer of Volvo Group.

H2 Green Steel expects its Boden plant to deliver steel with up to 95% less CO2 emissions compared to steel produced with traditional blast furnace technology.

Given the dominant role steel has in automotive manufacturing, transitioning to steel with such low CO2 emissions will have a massive impact on decarbonising the automotive supply chain.

“The commercial vehicle industry has actively been driving the demand for green steel, validating the market interest,” said Henrik Henriksson, H2 Green Steel’s CEO.

“When an undeniable large player like Volvo Group, working at the forefront of sustainable change, places a customer order it’s a clear sign of confidence in both our company and our product.”