warehouse racking

IKEA’s largest retailer to use hydrogen-produced steel in 50% of warehouse racking

In a pivotal move toward sustainability, Ingka Group, the world’s largest IKEA retailer, has inked a landmark agreement with H2 Green Steel to integrate hydrogen-based steel into 50% of IKEA’s global warehouse racking. Slated to be operational by 2026, the partnership aligns with Ingka Group’s aggressive carbon reduction agenda and IKEA’s commitment to achieve climate positivity by 2030.

H2 View reports that Ingka Group is committed to annually procuring at least 12,000 tonnes of this eco-friendly steel, offering a greener alternative to traditional steel production methods that contribute to higher carbon emissions.

H2 Green Steel, currently in the process of building its inaugural green steel manufacturing facility in Boden, Sweden, leverages hydrogen in the direct reduction of iron (DRI). This novel approach results in a staggering 95% reduction in carbon emissions compared to conventional steel production. The Boden plant is expected to commence its operations in 2025 with an initial output of five million tonnes per year.

Companies like H2 Green Steel are redefining the business landscape in a manner that positively impacts both the industry and the environment, said Karen Pflug, Chief Sustainability Officer at Ingka Group. She emphasized the role steel plays in warehouse infrastructure, noting that sourcing green steel across industries can significantly diminish global greenhouse gas emissions.

In a year marked by ecological strides, H2 Green Steel has secured multiple green steel offtake contracts, collectively valued in the billions of euros. Additionally, the company recently announced a €1.5 billion ($1.6 billion) equity raise, led by a consortium of investors that include Hy24, Altor, GIC, and Just Climate. These funds are earmarked for the construction of the Boden facility and the procurement of 700MW electrolysers, which will produce the green hydrogen feedstock, supplied by thyssenkrupp nucera.

The confluence of Ingka Group’s environmental stewardship and H2 Green Steel’s technological innovation could serve as a blueprint for other businesses aiming to balance profitability with sustainability. With steel being an integral part of industrial operations, this partnership offers a compelling case for reimagining supply chain components through the lens of green technology.

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