Sweden’s pioneering ‘fossil-free’ steel production plant has taken a key step forward with a SKr200m ($20.2m) investment by national utility Vattenfall, steel-maker SSAB, iron mining company LKAB and the Swedish Energy Agency (SEA) to construct a subterranean hydrogen storage facility.

The 100-cubic-metre tank for the scheme, which was launched in 2016 with the aim of commercialising the use of hydrogen rather than coke and coal in steel manufacture, will be built 25-35 meters underground on LKAB's land in Svartöberget starting in 2021, close to the pilot plant currently under construction on SSAB's site in Luleå.

The partners calculate that switching to clean-energy production of steel and iron has the potential to reduce the Nordic country’s total carbon emissions by 10%.

“The implementation study for the HYBRIT initiative showed that large-scale storage of hydrogen gas can play an important role in Sweden's future energy system,” the project partners said in a statement.

“As well as acting as a buffer to ensure an even flow to the steel production, a large-scale hydrogen gas storage facility would offer a better opportunity to balance the electricity system with a greater proportion of weather-dependent power generation and enable a competitive production cost for the fossil-free steel.”

Vattenfall CEO Magnus Hall said: "We, as partners, are step-by-step developing our joint fossil-free steel project, and the support from the SEA is important. Now we are investing in the next piece of the jigsaw puzzle for a value chain in which hydrogen gas plays a decisive role in the success of the initiative and the development of competitive fossil-free electricity generation in Sweden.

SSAB CEO Martin Lindqvist stated: "The HYBRIT initiative gives us the opportunity to eliminate carbon dioxide emissions completely, and to lead the work of developing fossil-free steel products. The investment in a storage facility for fossil-free hydrogen gas is an important building block in achieving our goal of a fossil-free value chain from ore to finished steel.

LKAB CEO Jan Moström added: "Hydrogen gas storage is an important issue to solve in order to bring the various elements of HYBRIT together. Large, complex and expensive leaps in technology need to be taken for the sake of the climate, to achieve the goal of zero net emissions.”

The storage facility, which will store pressurised hydrogen gas in a steel-lined bedrock cavern, is expected be ready for operation in 2022. In June 2018, the HYBRIT partners started the construction of the plant in Luleå, with retooling of a pellet works in Malmberget to switch over from coal to bio-oil, to manufacturing fossil-free pellets.

The pilot plants will be run from 2022-2024, with the partners exploring the possibility of scaling up the manufacturing by building a demonstration plant in 2025, three years earlier than originally planned, to produce fossil-free steel from iron ore for commercial use. By 2035, the companies hope to be selling fossil-free steel “on a broad scale”.

The Hybrit project has been granted financial support of SKr599m by the SEA, with the three partner companies investing SKr1.1bn.

Last month, the HYBRIT initiative joined the Leadership Group for Industry Transition launched by Sweden and India at the UN Climate Action Summit in New York.