Lhyfe and Ugitech sign an MoU to decarbonise steelmaker's operations using green hydrogen

Green hydrogen producer Lhyfe has signed a Memorandum of Understanding (MoU) with Ugitech , a subsidiary of stainless steel producer Swiss Steel Group, for the creation of a green hydrogen production unit near Ugitech's Ugine site (Savoie, France).
Lhyfe and Ugitech sign an MoU to decarbonise steelmaker
Ugitech's Ugine steel plant. Courtesy of Lhyfe/Ugitech.

The intention is to decarbonize part of the steelmaker's industrial operations and help decarbonize local mobility. The site, to be located in the heart of the French Alps where the 2030 Winter Olympics will be held, should also contribute to a sustainable model of winter tourism.

This is the first agreement in Europe to replace fossil fuels with green hydrogen in the stainless steel sector.

“We are delighted to sign this memorandum of understanding with Ugitech, whose commitment to decarbonisation we commend” said Philippe Desorme, Vice Chief Executive Officer at Lhyfe. “The steel sector is a major consumer of fossil fuels and is one of the industrial sectors that should be decarbonised as a priority. The energy transition is going to become increasingly necessary to ensure the long-term survival of our industries, and green hydrogen is emerging as one of the pillars of this transition. It can and must now be deployed as quickly as possible, including in the steel sector.”

As part of its roadmap for decarbonising its business, Swiss Steel Group, one of the world’s largest producers, processors and distributors of long special steel products, has decided to use green hydrogen at the Ugitech plant in Ugine, to replace the natural gas used in some of its thermoprocessing equipment (burners, reheating furnaces, heat treatment furnaces, etc.) and thus decarbonise part of its industrial processes. The steelmaker, which produces around 200,000 tonnes of steel a year, has selected Lhyfe to support it in this energy transition. This project could avoid emitting 16,000 tonnes of CO2 a year.

Lhyfe, which is signing its first memorandum of understanding with a steel manufacturer, already has three production sites and is currently building several sites in Europe.

Plans to produce up to twelve tonnes per day to decarbonise Ugitech’s operations and develop hydrogen mobility in the region

Lhyfe plans to install a green hydrogen production unit with a capacity up to twelve tonnes per day (a maximum electrolysis capacity of 30 MW), at Ugitech’s Ugine plant. This green hydrogen would be used mainly at the Ugitech plant, supplied via a pipeline. Lhyfe would also supply hydrogen to local mobility and industry players, to help develop the local hydrogen ecosystem, particularly in the run-up to the 2030 Winter Olympics.

The two partners are now entering the feasibility study phase of the project. Implementation of the project will be subject to the conclusions of this study, the granting of operating licences and building permits, and financial investment decisions.

“Ugitech is coordinating the HYDREAMS project, which aims to demonstrate the feasibility of substituting natural gas with decarbonised hydrogen in thermal steel transformation processes (reheating and heat treatment furnaces)” added Frédéric Perret, Director of Development at Ugitech. “HYDREAMS has nine European partners and has received a grant from the European RFCS fund. Using laboratory tests and industrial demonstrators, this project, which started in April 2023 and ends in October 2027, will verify that hydrogen combustion will have no negative impact on processes and products. The next step is to roll out this new solution to all systems for which direct electrification is not a compatible option. This is the purpose of this MoU with Lhyfe.”

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