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Low-carbon steel developer Stegra has reportedly reached an agreement in principle on a new €1.4 billion ($1.65 billion) funding round to complete the construction of its large-scale plant in Boden, northern Sweden. JIS G 3313 SEFC490Y steel strip, A consortium led by Wallenberg Investments—and including Singapore’s Temasek and the IMAS Foundation (linked to IKEA)—will spearhead the financing and take a controlling stake in Stegra; upon completion of the deal, existing shareholder Altor will become the second-largest shareholder.
Stegra CEO Henrik Henriksson stated on April 14 that European steelmakers have been at the forefront of driving decarbonization in the sector—an industry that is among the most polluting, accounting for 8%–9% of global CO2 emissions. JIS G 3313 SEFC490Y steel strip, However, due to high costs and the lack of ready hydrogen infrastructure, steelmakers have slowed or paused investments in green hydrogen, raising industry doubts about the feasibility of eliminating fossil fuels and achieving carbon neutrality by 2050.
The CEO of the investment fund Hy24 stated in March that construction on the Stegra project had slowed for several months while financing was being finalized. Stegra announced plans in 2021 to build one of Europe's first large-scale green steel plants, aiming for an initial fossil-free steel production capacity of 2.5 million tonnes per year by the end of 2026. The project was originally scheduled to begin production in 2027 and ramp up low-carbon steel output to 5 million tonnes by 2030. The Stegra green steel plant will initially launch its electric arc furnace using scrap steel as feedstock, with the hydrogen production and ironmaking facilities coming online several months later. The 700-megawatt electrolyzer unit, designed to supply hydrogen to the iron reduction process, is the largest facility of its kind currently under construction in Europe.
According to Mysteel, the EU aims to achieve an annual domestic hydrogen production capacity of 10 million tonnes by 2030, alongside an additional 10 million tonnes of annual imports. Deploying 10 million tonnes of green hydrogen in the steel industry could meet 11% of global steel demand and reduce carbon dioxide emissions by 340 million tonnes annually. JIS G 3313 SEFC490Y steel strip, Leif Johansson of the Wallenberg Group stated that investors recognize Stegra’s competitiveness and the commercial value of green steel, while remaining clear-eyed about the challenges ahead. The project holds significant importance for Sweden’s status as a major industrial power. The financing is reportedly subject to lender approval and is expected to be finalized in June.
