How offshore wind can unlock a competitive EU steel industry

Europe's offshore wind potential is at the heart of the North Sea Energy Cooperation's (NSEC) efforts to achieve climate neutrality, affordability and energy independence amid turbulent geopolitical conditions. 

As part of the NSEC, the energy ministers, European Commission and stakeholders met last year to set the agenda for the next 15 years of cooperation.

At the NSEC's North Sea Summit in Hamburg in January, building on the Esbjerg and Ostend declarations, the energy ministers of Belgium, Denmark, France, Germany, Ireland, Luxembourg, the Netherlands, Norway and the United Kingdom signed a joint declaration to set out their ambitions of 300GW by 2050, tenders for European installation capacity of up to 15GW per year in the period 2031-2040 and 100GW of cross border cooperation projects for the North Sea.

Ahead of the Summit, the eight Baltic TSOs, organised in the Baltic Offshore Grid Initiative – 50Hertz (Germany), AST (Latvia), Elering (Estonia), Energinet (Denmark), Fingrid (Finland), Litgrid (Lithuania), PSE (Poland) and Svenska kraftnät (Sweden) – published an offshore system study to promote coordinated maritime spatial planning, which could become an energy hub by 2040 with around 13GW of new interconnectors and up to 50GW of additional offshore wind compared to 2030. 

Clean Industrial Deal takes shape

Offshore wind energy is of great importance to Europe. It is cost-effective – cheaper than building a new fossil fuel power plant. It is efficient – a single offshore wind turbine supplies 16,000 households with electricity. And it is based in Europe – it employs 100,000 Europeans. 

Realising the potential of offshore wind energy in the North Sea and Baltic Sea creates jobs, supplies energy and promotes industrialisation in Europe. 

The North Sea Summit's investment pact will mobilise €1 trillion in economic activity and create around 91,000 additional jobs for Europe by 2031, based on the potential of the North Sea alone. So far, so good. What's more, offshore wind provides the energy with the power plant characteristics needed to transform energy intensive industries and stabilise electricity grids. 

Moving on to the steel industry, another brief intermediate step is necessary. This involves creating a solid investment framework for offshore wind energy through targeted mechanisms such as long-term power purchase agreements (PPAs), including cross-border PPAs. PPAs enable energy intensive companies, such as steel producers, to avoid price fluctuations by fixing the price as electricity consumers. This requires an electricity market design that is geared towards renewable energies to be able to use PPAs in the proposed manner. 

This is transferable to green hydrogen. And that brings us quickly to the tender criteria and the Net Zero Industry Act. But first, let's look at the steel industry using Salzgitter AG as an example.

Transformation of energy intensive industry

Salzgitter AG has entered into strategic partnerships with developers and operators of offshore wind energy at an early stage and secured PPAs with offshore wind farms in the North Sea and Baltic Sea.

In example 1, Salzgitter AG and Ørsted are working towards closed value chains in their business relationship. In addition to the supply of offshore wind energy and the use of renewable hydrogen, this also includes the production of low carbon steel and its use in components for Ørsted's offshore wind farms. There are also plans to recycle scrap from wind turbines that are being dismantled in the steel production process.

In example 2, Vattenfall and the steel group are pursuing their common goal of decarbonising industrial production processes. A new PPA stipulates that fossil-free electricity from the Nordlicht 1 offshore wind farm will be available for steel production from 2028.

In example 3, Salzgitter Flachstahl GmbH and Iberdrola Deutschland signed a long-term electricity supply contract from 2023. The electricity is to come from the Baltic Eagle offshore wind farm in the German Baltic Sea. With this PPA, Salzgitter Flachstahl GmbH has secured the supply of 114MW of green electricity for 15 years.

There are other European steel producers that are undergoing sustainable transformation and require green electricity and green hydrogen for this purpose. A competitive European steel industry creates jobs in Europe and is necessary for the resilient transition to a sustainable energy supply.

Not a one-way street

Ilsenburger Grobblech GmbH, a subsidiary of Salzgitter AG, and wind turbine manufacturer Siemens Gamesa signed a contract last year for the supply of around 25,000 tonnes of heavy plate for the construction of 36 wind towers. 

The so-called Siemens Gamesa 'GreenerTower’ has CO2eq emissions of less than 700kg per tonne of steel per tower. RWE is testing these CO2-reduced steel towers in half of the offshore wind turbines in its Danish offshore wind farm Thor and reports a CO2 reduction of at least 63% in the steel plates of the tower compared to conventional steel. In this way, the European steel industry is reducing the carbon footprint of offshore wind farms in Europe.

Green hydrogen from offshore wind energy is very important for the decarbonisation of other industrial sectors that are difficult to electrify. In addition to the steel industry these include the chemical industry, cement industry, maritime industry, transport, etc.

By the end of 2025, Amazon will have initiated more than 230 wind and solar projects in 13 European countries. Once all projects are operational, they are expected to provide 9GW of clean energy capacity. That is enough to power more than 6.7 million households in the EU annually. The demand is high. This is particularly true for AI and data centres in Europe. 

Why the Clean Industrial Deal secures Europe

In order to enable a clean, secure and competitive energy union, the overarching theme of the 20th edition of the European Sustainable Energy Week (EUSEW), there must be fair competition and European cross-industry lead markets as described must be able to grow.

The carbon border adjustment mechanism (CBAM) and net zero industry act are essential for this within the framework of the Clean Industrial Deal, with a focus on resilience and climate protection. In this way, industrial transformation for greater climate protection can simultaneously achieve energy independence, increased value creation potential, jobs and thus growing prosperity for Europe. 

All this requires a level playing field protected from price dumping with skilled workers, European technology development, production capacities and accelerated infrastructure expansion. 

The necessary regulations for green hydrogen and floating offshore wind energy will accelerate the development described above. In this way, the Clean Industrial Deal will lead to growing sustainable value creation for and, above all, within Europe.

This opinion editorial is produced in cooperation with European Sustainable Energy Week (EUSEW) - the biggest annual event dedicated to renewables and efficient energy use in Europe. #EUSEW2026 marks the 20th edition and will once again bring together the community of people who care about building a secure and clean energy future for the next generations.

Useful links

1. Europe's Wind Energy Workforce Report.
2. Global Offshore Wind Report.
3. Implementing Regulation (EU) 2025/1176 of 23 May 2025 specifying the pre-qualification and award criteria for auctions for the deployment of energy from renewable sources.
4. 2-in-1: carbon footprint as a quality criterion in the NZIA.
5. Offshore Wind Foundations Alliances resources.

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