Green steel developer Stegra has agreed two power supply deals for its 700MW renewable hydrogen and steel project, which is currently under construction in Boden, Sweden and due to start operation in early 2026.
The deals amount to 8.25TWh of electricity supply, with 6TWh coming from Germany’s Uniper over six years, and a further 2.25TWh coming from Switzerland-based power trader Axpo over three years, both beginning in 2027.
Neither company has revealed the generation source of the electricity supplied under the deals, although Axpo currently has around 24TWh of renewable power from wind and solar “under management” in the Nordic region.
Stegra — formerly known as H2 Green Steel — has been working to procure vast quantities of power for the first phase of the Boden plant, which will produce 2.5 million tonnes of steel from direct-reduced iron (DRI), which will be made with green hydrogen produced at the site.
As well as requiring electricity for 700MW of electrolysers, it must also power an electric arc furnace at the plant.
The company told Hydrogen Insight earlier this year that it had secured 40-50% of its power needs for phase one from hydropower and onshore wind.
In 2022, it bagged a 14TWh, seven-year power supply deal with Statkraft, which it said at the time would account for 30% of its power needs, implying an overall power demand of 46TWh over seven years.
The company then in 2023 agreed a deal with Fortum for around 2.3TWh per year across two deals of differing lengths.
“The different contracts have different lengths and set ups,” a spokesperson for Stegra told Hydrogen Insight today. “We have covered around half of our future electricity needs in PPAs and will continue to build our electricity portfolio over time with agreements of different, scope, length and character up until the start of operations when we also plan to buy electricity on the spot market.”
Arne Österlind, head of energy portfolio at Stegra, described the agreement with Axpo as a “major step forward” for the project, also implying that the developer is exploring further deals with Uniper as part of a long-term partnership.
“The agreement with Uniper forms the base for a strategic partnership with a player which can provide us with long-term access to electricity for our plant in Boden, set to produce green hydrogen, green iron and green steel at scale,” he said. “This electricity delivery is central to our strategy.”
Stegra said in October that the steel mill itself is under construction with a plan to begin operation within 500 days, implying a start date of February 2026. The first steel is expected to roll off the production lines in April 2026.
The company has a power allocation from Sweden’s grid operator for phase one of the project, but had its allocation for phase two (which would see the plant’s steel production capacity scaled up to five million tonnes per year) abruptly cancelled following a change in regulations.
UPDATED: with Stegra comments
