BMW will begin to use steel produced by natural gas or hydrogen as well as green power sources from its supplier network, and will also increase the use of recycled steel to be used in BMW’s standard production of cars, at its European plants by 2026.
The car manufacturer will expand its sourcing of low-carbon steel from two suppliers, Salzgitter AG and H2 Green Steel. BMW says it will use low-carbon steel to meet more than 40% of the steel needed at its European plants by 2030, which will help reduce carbon emissions by up to 400,000 metric tons per year.
BMW was already using Salzgitter AG as a steel supplier and the company will use green hydrogen instead of coal for its steel production.
Salzgitter AG will also increase the use of recycled steel for BMW, such as taking steel scraps from car production and using the materials to make new steel. That steel will then be returned to BMW manufacturing sites for continued use.
According to the International Energy Agency, in 2019 around 22% of steel was made by remolding scrap, making production out of recycled materials one of the primary sources of cleaner steel production.
BMW says up to a quarter of the steel used in its vehicles comes from recycled materials and circular manufacturing. It wants to increase that number to 50% by 2030. Using the secondary steel also requires significantly less energy, BMW says, and emissions on average are 50% to 80% lower than primary steel production.
H2 Green Steel will begin supplying BMW with the cleaner materials in 2025. The company says its steel production reduces emissions by 95%.
H2 Green Steel is also part of the Green Hydrogen Catapult (GHC), an organization committed to producing the clean fuel. It is especially impactful for heavy industries like steel.
The GHC recently announced plans to increase its agreement to commission electrolyzers for green hydrogen production from 25 gigawatts to 47 gigawatts by 2027. At the time, H2 Green Steel CEO Henrik Henriksson said the company was seeing demand for green steel outpace their production.
BMW isn’t the only car manufacturer to increase green steel use.
In October 2021, General Motors said it will use net zero steel products made by Nucor; those products use 100% renewable electricity and carbon offsets. BMW has also invested in startup Boston Metal, which will produce carbon free steel by using electricity from renewable sources.
BMW plants in Europe process more than half a million tons of steel per year.
“This is an important step in substantially reducing CO2 emissions at source in the supplier network,” says Joachim Post, a member of the board of management of BMW AG responsible for purchasing and supplier network.