Nel Hydrogen Electrolyser AS, a division of Nel ASA (OSE: NEL), has received a purchase order for a 20MW alkaline water electrolyzer from Ovako, a European manufacturer of engineering steel. The electrolyzer will be installed at Ovako’s existing plant in Hofors, Sweden, the first plant in the world to use hydrogen to heat steel prior to rolling and hot forming. The fossil-free hydrogen will replace fossil propane gas currently used in heating furnaces at the site.
The purchase order has a contract value of approximately EUR 11 million, and the equipment is expected to be delivered at the end of 2022, with the first hydrogen production in 2023. The electrolyzer will produce oxygen and hydrogen to be used in Ovako’s steel-heating process and is a major step towards zero-carbon emission steel production. The conversion to hydrogen will enable Ovako to reduce its CO2 emissions for steel production in Hofors by 50 percent from already low levels.
“In June, we announced our collaboration with the Volvo Group, Hitachi Energy, H2 Green Steel, and Nel Hydrogen with the purpose to invest in fossil-free hydrogen in Hofors. An investment that also got support from the Swedish Energy Agency. We are now very pleased to have reached this important milestone of the project. The electrolyzer technology will enable us to eliminate CO2 for heating steel before rolling”, says Rickard Qvarfort, President Business unit Hofors.
Ovako is a European manufacturer of engineering steel for customers, e.g., in the bearing, transportation, and manufacturing industries, and is a subsidiary of Sanyo Special Steel and part of the Nippon Steel Corporation Group. The company has a geographical presence in Europe, North America, and Asia.