InvestEU backs €209 million of financing for large-scale production of green steel with minimal carbon footprint in Sweden

The European Investment Bank (EIB) and the Nordic Investment Bank (NIB) will take part in the project finance deal to support H2 Green Steel’s large-scale green steel production facility in Northern Sweden. The EIB will contribute €314 million, of which €200 backed by a guarantee granted by the European Commission under the InvestEU programme, and €114 million of intermediated financing to be provided through commercial banks participating in the project financing. The NIB will provide €57 million to the project finance package, of which €9 million supported under InvestEU.

The green steel will be produced with up to 95% fewer CO2 emissions compared to the current manufacturing process. This ground-breaking European flagship project is essential for the decarbonisation of the primary steel industry, one of the hard to abate sectors. The financing agreements are supported in part under InvestEU’s research, innovation and digitalisation window, supporting the EU policy objective of developing and boosting innovative technologies for the green transition. They are also in line with the European Commission’s Green Deal Industrial Plan, which aims to provide support to scale up the EU’s manufacturing capacity for the net-zero technologies required to meet Europe’s ambitious climate targets.

Commissioner for Economy, Paolo Gentiloni, said: “This agreement is a great demonstration of InvestEU’s support for Europe’s transition to climate neutrality. I am proud that, together with the European Investment Bank and the Nordic Investment Bank as key implementing partners, InvestEU is backing this pioneering initiative, contributing to the production of more sustainable steel in Sweden. This is good news for both the climate and our economy as it will help to significantly cut CO2-emissions, while boosting innovative technologies and creating jobs in Europe, supporting our net-zero industrial base.”

The InvestEU programme provides the EU with long-term funding by leveraging private and public funds in support of EU policy priorities. As part of the programme, the InvestEU Fund is implemented through financial partners who will invest in projects using the EU budget guarantee and thus mobilising at least €372 billion in additional investment.