Under the terms of the deal, Siemens will build the Herne-6 unit which will have an electrical capacity of more than 600MW. It will have capacity to produce 400MW of thermal energy with combined cycle operation.

The thermal energy generated by the plant will be used for the district heating grid of Germany’s Rhine-Ruhr metropolitan region.

STEAG and Siemens also signed a long-term service agreement for the power plant project.

The new gas-fired CHP plant will have fuel efficiency of more than 85%, making it one of the world’s most efficient and most environmentally friendly plants, Siemens said.

Siemens Power & Gas Division CEO Willi Meixner said: “We’re very pleased that we were able to land this project in a difficult market environment.

“This success also shows that our strategy of developing projects in close collaboration with our customers is working. Environmentally friendly, gas-fired CHP plants such as Herne 6 can play an important role in further implementing the transition to a new energy mix in Germany.”

As a general contractor, Siemens will be responsible for the construction of the plant on the site of an existing power plant owned by STEAG in Herne.

Siemens plans to manufacture the plant’s key components in Germany. These include steam turbine and generator in Mülheim as well as the H-class gas turbine at the gas turbine factory in Berlin.

STEAG management board chairman Joachim Rumstadt said: “We are convinced that Siemens is the right partner for this important and pioneering project.

“As we know from our successful collaboration in earlier projects, Siemens has excellent expertise in the area of power plant construction.”

Scheduled to enter service in the spring of 2022, the new gas-fired CHP plant is expected to generate electricity and reliably supply the Rhine-Ruhr region with district heat at the same time.