German steelmaker Salzgitter AG has announced that its subsidiary Salzgitter Flachstahl has signed a long-term power purchase agreement (PPA) with renewable energy company Zelestra covering 147 MW of solar capacity combined with 79 MW/237 MWh of battery storage, supporting Salzgitter's transition toward lower-carbon steel production under its SALCOS program.
According to the companies, the agreement, which covers two projects, represents Germany's largest hybrid solar-plus-energy-storage power supply agreement. It is also the first hybrid PPA in the German market for both companies.
Salzgitter to purchase 158 GWh of solar power annually
Under the agreement, Zelestra will build, own and operate two new hybrid solar and battery storage plants in Brandenburg and Thuringia. Each solar facility will be directly connected to a battery energy storage system.
Salzgitter Flachstahl will purchase a combined 147 MW, equivalent to 158 GWh per year, of solar power from the two projects and will control the operation of their battery storage systems. The arrangement will make Salzgitter a battery storage system operator for the first time.
The battery systems will be charged exclusively with surplus electricity generated by the associated solar plants, ensuring that the electricity subsequently supplied from storage is renewable.
The combination of solar generation and storage will allow Salzgitter to adjust its renewable electricity supply more closely to the consumption requirements of its industrial operations.
Green electricity to support SALCOS steel transformation
Salzgitter Flachstahl considers hybrid PPAs an important part of meeting the growing demand for renewable electricity resulting from the transformation of its steelmaking operations under the SALCOS program.
“The combination of solar energy and battery storage opens up the opportunity for us to procure renewable energy for our industrial processes in line with demand and at competitive conditions,” Marco Hauer, head of group energy procurement at Salzgitter Flachstahl, said, adding that the agreement supports the company's steel production decarbonization plans and the competitiveness of its Salzgitter site.
