Spanish independent power producer (IPP) Zelestra has signed a power purchase agreement (PPA) with German steel manufacturer Salzgitter Flachstahl for a new solar-plus-storage portfolio, which Zelestra Germany CEO Mathias Künicke said is “the largest hybrid deal in Germany to date.”
The portfolio will consist of two new solar PV projects, with a combined capacity of 147MW, to be combined with 79MW/237MWh of battery energy storage systems (BESS). The projects will be built in Thuriginia, in eastern Germany, and Brandenburg, in central Germany, and supply power to the Salzgitter steel facility in the city of the same name.
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Zelestra will build, own and operate the solar facilities, while Salzgitter Flachstahl, a subsidiary of Salzgitter AG, will acquire all of the power generated at the projects and manage the batteries. The deal is both companies’ first hybrid PPA in Germany.
“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,” said Salzgitter Flachstahl head of group energy procurement Marco Huber. “The agreement supports our ambitious decarbonisation of steel production and helps to secure the competitiveness of the Salzgitter site.”
This “ambitious” plan has been dubbed ‘SALCOS’ (Salzgitter Low CO2 Steelmaking), and is a €2.7 billion (US$3.12 billion) initiative from Salzgitter AG to replace coal used in its steelmaking operations with green hydrogen produced by renewable energy. Zelestra CEO Leonardo Moreno added on LinkedIn that the deal, which is the largest solar-plus-storage offtake agreement signed in Germany, will be an “important element” of Salzgitter AG’s decarbonisation plan.
The steelmaker has already invested in green hydrogen production through wind turbine operator Avacon’s installation of a 30MW wind farm at its manufacturing centre, and the Zelestra deal represents its first entry into the solar-plus-storage space.
Read the full version of this story on our sister site Energy-Storage.news.
