The European Commission says it has approved, under EU State aid rules, a €128 million ($139m) Swedish measure to support SSAB in decarbonising its steel production, Kallanish learns.
Sweden notified the Commission of a €128m measure to support SSAB’s project to transition from its current coal-based steel production process in Luleå.
The Commission says in a statement that the aid will take the form of a direct grant and come from the Just Transition Fund.
These funds will support the accelerated transition for the installation of its electric arc furnace, equipment for secondary metallurgy and a caster. The EAF will use scrap and direct reduced iron produced using renewable hydrogen, with a capacity of 2.5 million tonnes/year of green slab.
The measure will accelerate the project by three years and the new installation is envisioned to start producing green steel as of 2029.
The funding allows for significant carbon emission savings versus three years of operation using fossil fuels.
The Commission adds that the project will help to end dependence on Russian fossil fuels while also helping to meet the demands of policies such as the European Green Deal, the Green Deal Industrial Plan and the REPowerEU Plan.
SSAB has committed to share the technical know-how gained through the project with industry and academia, while a claw-back mechanism will also be in place, if the project generates extra net revenue.
Carrie Bone UK