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German steel and metal producer Salzgitter Flachstahl GmbH has entered a long-term power purchase agreement (PPA) for 900 GWh of solar power supply from Iberdrola Deutschland's 60 MW solar PV plant.
The corporate PPA translates into 60 GWh of annual green electricity supply during the 15-year period. It will kick into effect from 2025 onwards. Iberdrola will cater to this PPA from a solar power plant in Germany's Saxony-Anhalt.
The Spanish giant calls the 60 MW facility the company's second-largest solar power plant in Germany which is currently at an advanced stage in development. Project commissioning is planned for 2025.
Iberdrola and Salzgitter are already under a PPA for the supply of 6,500 GWh to be supplied from the former's Baltic Eagle Offshore Wind Farm.
"The expansion of our cooperation with Iberdrola is another important component of our energy strategy. With their support, we can secure the demand for electricity generated from renewable sources for Salzgitter AG and in particular for our SALCOS® transformation program," said Salzgitter Flachstahl CEO Ulrich Grethe.
Under its SALCOS or Salzgitter Low CO2 Steelmaking program, the company plans to use hydrogen for climate-neutral steel production, thus replacing the use of coal in its blast furnaces. Recently, Salzgitter also signed a pre-contract with Uniper to supply green hydrogen for the SALCOS project.
For Iberdrola, these contracts with corporate customers are part of its strategy to further expand its presence in the German onshore business. Both the signatories target to ensure competitive electricity supply and stable prices for large commercial customers, they add.