Sweden’s H2 Green Steel (H2GS) has signed a 7-year binding agreement with ZF, one of the biggest suppliers to the automotive industry globally. Deliveries of near zero emissions steel are set to begin in 2026.
ZF directly and indirectly processes around 2.5 mln tons of steel per year worldwide. This agreement covers a significant share of ZF’s yearly steel volumes, making it strategically important in the company’s efforts to decarbonize its operations.
ZF has a strong sustainability strategy and aims to be climate neutral by 2040, including value chain emissions. This agreement, valued at EUR 1.5 bln, is expected to reduce CO2 emissions by close to 2.3 mln tons compared to traditional steelmaking processes.
The agreement will see H2GS also work closely with ZF’s sub-suppliers, with the goal of driving the steel industry transformation as an integrated approach in the entire supply chain.
ZF has 168 production locations in 32 countries. The company was founded in 1915 and is global technology company supplying mobility technology for passenger cars, commercial vehicles and other industrial applications.
H2GS was launched in 2021 to accelerate the decarbonization of hard to abate industries. Starting with steel – one of the heaviest polluting industries – the company is building a green field steel plant in Boden which will run on renewable electricity. The plant will produce its own green hydrogen in a giga-scale electrolyzer, which in turn will reduce iron ore to green sponge iron through direct reduction. The green sponge iron will feed the green steel process achieving emission reductions of up to 95 pct compared to traditional steelmaking with coke and coal in a blast furnace.
