EC approves €128 million state aid to Sweden to support SSAB in decarbonization

The European Commission (EC) has approved €128 million in state aid to Sweden to support steelmaker SSAB in decarbonizing steel production at its Luleå site. This is stated in the report of the institution.

The assistance will take the form of a direct grant. It will support the company’s accelerated transition to electric arc furnace production by installing an electric arc furnace (EAF), secondary metallurgy equipment and a continuous casting machine.

The EAF will operate on scrap and direct reduced iron produced using renewable hydrogen. The capacity of SSAB’s electric arc furnace plant in Luleå will be 2.5 million tons of green slabs per year.

According to the EC, this measure will accelerate the project by three years. The new facility is expected to start producing green steel in 2029. SSAB has committed to actively sharing the experience and technical know-how gained from the project with industry and academia.

In the spring 2024, SSAB decided to build a modern, environmentally friendly mini-mill in Luleå. The project involves shutting down the current blast furnace-based production system. This will reduce CO2 emissions in the country by 7% in addition to the 3% reduction achieved through the conversion of the Oxelosund plant.

As GMK Center reported earlier, SSAB started construction of an electric arc furnace in Ökselesund at the end of 2023. The company intends to transform its entire production system in Northern Europe by 2030. Investments in the EAF in Ökselesund and related raw material processing will amount to about $600 million.