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• Pioneering green steel demonstration project could boost trade and accelerate decarbonization in sector currently responsible for up to 8 percent of global carbon emissions

• Ahead of the UAE hosting UN climate change conference, COP28, the pilot project could cut CO2 in steel-making process by 95 percent and turbocharge UAE’s journey to becoming green steel production hub

Abu Dhabi Future Energy Company PJSC – Masdar, one of the world’s leading renewable energy companies, has partnered with Emirates Steel Arkan, (ADX: EMSTEEL), one of the largest publicly traded steel and building materials manufacturers in the region, to develop an innovative green hydrogen project to decarbonize the hard-to-abate steel sector in the UAE.

The pilot project is the first-of-its-kind in the Middle East and North African region. Located in the Emirates Steel Arkan production facilities at the Industrial City of Abu Dhabi, the project is currently in the installation phase. Electrolyzers have already been delivered to the site to help produce ‘green steel’, a premium product sought after by global manufacturers eager to meet their net-zero goals. Expected to be commissioned in early 2024, the project will demonstrate the use of green hydrogen - instead of natural gas - to extract iron from iron ore, a key step in steelmaking.

The rising global demand for green steel, presents huge growth potential for the UAE’s steel industry as the country aspires to be among the frontrunners to decarbonize the global steel value chain. The project shows how clean energy and heavy industry partners in the UAE are taking urgent action to accelerate decarbonization. It is also a significant step in enabling the UAE’s strategy of making the country one of the world’s largest hydrogen producers by 2031. Steel manufacturing contributes between 7 and 8 percent of worldwide carbon emissions. Decarbonizing this industry holds the key to propelling the world towards a net-zero future. With the UN climate change conference COP28 set to begin in the UAE at the end of this month, innovative projects that halt emissions without stifling progress will be a focus of international attention.

Active in over 40 countries and with a total electricity generation capacity of over 20GW, Masdar is targeting 100GW by 2030. Masdar will have a strong presence during COP28 in Expo City, Dubai, where it plans to showcase innovative projects including this pioneering partnership with Emirates Steel Arkan.

Mohamed Jameel Al Ramahi, CEO of Masdar, said:

Eng. Saeed Ghumran Al Remeithi, Group CEO of Emirates Steel Arkan, said:

Emirates Steel Arkan’s carbon intensity is independently certified to be less than half of the global steel industry average, and in 2022, it made significant strides in energy efficiency, achieving a double-digit reduction in energy intensity and a remarkable reduction in emissions and emissions intensity. This was achieved by using 80% of clean electricity, carbon capture, and scrap metal utilization. Emirates Steel Arkan is committed to reducing 40% in carbon emissions by 2030, with primary aim to achieve Net-Zero by 2050.

Masdar is dedicated to advancing the decarbonization of hard-to-abate sectors to secure global net-zero goals. For the past year, Masdar has been leading the ‘decarbonizing industry’ working group under the Sustainable Markets Initiative launched by His Majesty King Charles III of Britain.

Established in 2006, Masdar is active in more than 40 countries with a total electricity generation capacity of more than 20GW. It has invested, or committed to invest, in worldwide projects with a combined value of more than US$30 billion with ambitious growth plans to reach 100GW and 1 million tonnes of green hydrogen by 2030.

• VERBUND to be co-developer of produced green hydrogen
• Agreement follows Masdar’s launch of new green hydrogen business unit in December

Masdar, one of the world’s fastest-growing clean energy companies, has signed a memorandum of understanding (MoU) with VERBUND, Austria’s leading energy utility and one of the largest producers of hydropower in Europe, to explore the production of green hydrogen for the Central Europe market.

The MoU was signed at Abu Dhabi Sustainability Week (ADSW) 2023  by Michael Strugl, Chief Executive Officer, VERBUND, and Mohammad Abdelqader El Ramahi, Executive Director, Green Hydrogen, Masdar. As per the agreement, the two companies will cooperate on developing pathways to produce and export green hydrogen to Central Europe, specifically Austria and Southern Germany. 

Mohamed Jameel Ramahi, Chief Executive Officer, Masdar, said, “Masdar has long pioneered green hydrogen as an energy source for the future and today we believe that future is upon us. We are committed to developing our green hydrogen business as we see it playing a significant role in the global energy transition.  We look forward to partnering with like-minded companies like VERBUND to accelerate investment in this sector and to meet growing demand in Europe.” 

Last year, Masdar announced the establishment of its new green hydrogen business, with a goal of producing 1 million tonnes of green hydrogen per annum by 2030.

"Green hydrogen is the game-changer for a sustainable energy system, taking us a step closer to carbon neutrality. As a leading renewable energy company, VERBUND is working on the development and expansion of local hydrogen production as well as long-term import solutions,” said Michael Strugl, Chief Executive Officer, VERBUND. "We are very pleased about the cooperation we signed today with Masdar. Only with global partnerships like this one will we be able to achieve the goal of a successful sustainable energy transition." 

VERBUND generates close to 100 percent of its electricity from climate-friendly, renewable energy, primarily hydropower, complemented by wind and solar, and is also active in energy transmission and international trading. It believes green hydrogen will become a crucial building block to decarbonize industry and transport in Europe and has already launched several flagship projects to expand its value chain into green hydrogen.

Green hydrogen is typically hydrogen produced from water electrolysis powered by renewable electricity. The resulting energy carrier can be used in many energy applications. It can be used in the form of hydrogen or converted to other derivatives for industry, power, or transportation, supporting the decarbonization of hard-to-abate sectors like heavy industry, long-haul freight, shipping, and aviation. 

With such a wide range of prospective uses and needs, green hydrogen demand is expected to grow greatly in the coming years. According to the International Energy Agency’s Global Hydrogen Review 2022, meeting governments’ climate pledges alone will require 34 million tonnes per annum (mtpa) by 2030.

Masdar is seeking to become one of the world’s leading players in the growing green hydrogen econpmy, one of the company’s executive directors told Energy Intelligence. As one of the world’s leading clean energy companies, Masdar has set its sights on becoming a hub for the production and export of green hydrogen, Mohammed Abdelqader El-Ramahi, Masdar’s Executive Director for Hydrogen, said in an interview.

“We want to become one of the top five players globally,“ El-Ramahi said according to the report, “and we want to be one of the key players in the green hydrogen spectrum as the fuel of the future,”

Late last year, Abu Dhabi National Oil Co. (ADNOC) and TAQA, Abu Dhabi National Energy Company, completed the transaction that saw them take stakes in Masdar alongside the UAE’s sovereign wealth fund, Mubadala. The new partnership means Masdar has set ambitious targets of reaching 100 gigawatts of mostly solar and wind capacity by 2030, up from 20 GW currently. The company has also established a green hydrogen unit, headed by El-Ramahi, which is targeting production of 1 million tonnes of green hydrogen and derivatives by 2030.

By capitalizing on shareholder ADNOC’s infrastructure and key role in the petrochemical, oil and gas industries, Masdar will make Abu Dhabi a key international hub for the production and export of green hydrogen and its derivatives, El-Ramahi said. “We are leveraging their knowledge,“ he told Energy Intelligence, “not to mention also their network trading routes in the spectrum of green hydrogen.”

Of the 1 million tonnes capacity, half will be produced in Abu Dhabi, with local demand projected at around 200,000 tonnes per year, and the remaining volumes exported, according to the report, with the rest produced internationally.

El-Ramahi said Masdar is focusing on “key geographies,” including Saudi Arabia and Oman. Both countries have significant solar and wind potential. Egypt and Morocco are also attractive locations, given their access to infrastructure and status as export hubs.

“We will be leveraging our potentials within Mubadala, TAQA and ADNOC on all prospects — financial through relationships with banks and international financial institutions, in addition to both technical and commercial networks, knowledge, know-how, to accelerate this footpath into meeting our projected targets,” El-Ramahi said.

He predicted that, as technology evolves and regulatory frameworks are established, the green hydrogen market will grow. Masdar also sees green hydrogen becoming cost competitive beyond 2027 and toward 2030.