Sweden-based truck and bus manufacturer Scania and Sweden-based global steel company SSAB today announced a new fossil-free steel agreement, including a target to decarbonize all SSAB steel supplies to Scania’s heavy-duty vehicles by 2030. SSAB is the main steel supplier for Scania vehicles.
Steel production is one of the largest emitters of CO2 globally, with the sector’s total greenhouse gas (GHG) emissions responsible for 7% – 9% of direct emissions from global fossil fuel use.
SSAB announced plans in 2021 to commercialize its fossil-free steelmaking technology, HYBRIT, developed in collaboration with partners Vattenfall and LKAB, by 2026. HYBRIT replaces the coking coal traditionally used for iron ore production with fossil-free electricity and hydrogen produces water as a by-product instead of carbon dioxide.
Deliveries under the new agreement are expected to begin in 2026.
Martin Lindqvist, CEO of SSAB said:
“We are really looking forward to increasing deliveries of our fossil-free steel and thus contributing to more sustainable value chains. Fossil-free steel will be a game changer in heavy transport. It has the same high quality and technical properties as traditional steel. And while it is produced in a sustainable way, it can also be recycled, just like steel always has been.”
The new agreement follows Scania’s commitment last year to decarbonise its supply chain by 2030, with efforts focused on key sources of emissions from manufacturing materials, with batteries, steel, aluminum and cast iron accounting for around 80%.
Both companies are members of the First Movers Coalition, which encourages companies in sectors where decarbonisation is a challenge to make more low-carbon purchases. of which Scania and SSAB are members, to reduce the carbon footprint in hard-to-reduce sectors. The companies said the new agreement will support their goals to use their purchasing power to create early markets for innovative clean technologies.
Christian Levin, CEO of Scania, said:
“Scania’s goal is to stimulate the shift towards a sustainable transport system. To achieve that goal, we are taking action across the entire value chain together with partners such as SSAB, which is leading the transition to a sustainable steel industry.”