The European Commission has sanctioned a substantial €265 million aid package to support the development of a pioneering green steel plant in Sweden. The state aid, approved for H2 Green Steel (H2GS), will contribute to the establishment of a low-emission steel plant in Boden, which is expected to commence operations in 2026.

This innovative facility will be equipped with a 690-megawatt electrolyser, a direct reduction plant utilizing renewable hydrogen, two electric arc furnaces, and comprehensive rolling and finishing facilities. With an anticipated annual production capacity of 2.4 million tonnes, the plant is set to become a significant producer of green steel.

The grant, partially funded through the Recovery and Resilience Facility (RRF), elevates the total state funding for the project to over €500 million. The project, which had previously received €250 million from the EU’s Innovation Fund, represents a total investment estimated at around €6 billion.

Margrethe Vestager, the Executive Vice President of the European Commission in charge of competition policy, highlighted the importance of this aid in establishing Europe's first large-scale steel plant powered entirely by hydrogen from renewable sources. This strategic move aligns with the EU's goal of achieving climate neutrality by 2050, while ensuring fair competition in the market.