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14 September 2022

H2 Green Steel lands more cash for development

By Bogdan Avramuta

Swedish green steel advocate, H2 Green Steel, has secured a total of $190 million in the first Series B financing round from a selected group of investors but it hopes to raise as much as $2.5 billion in subsequent rounds.

Following its launch in February 2021, and the closing of the Series A financial round in May of the same year, the company has gained approval for the construction of a steel production plant in Boden, Sweden, in record time. The firm has also secured contracts for 14 TWh of renewable energy that will power the Boden facility where groundwork has already started.

The Series B funding was led by new investors like Swedbank Robur Alternative Equity, AMF, GIC, Schaffler along with previous supporters and shareholders like Altor Fond V Vargas, Kingspan, FAM, Marcegaglia, IMAS Foundation, Cristina Stenbeck and Daniel Ek.

Henrik Henriksson, CEO of  H2 Green Steel, said that this “financing milestone is a real declaration of confidence for H2 Green Steel.”

According to our latest steel industry forecast, the global crude steel production will hit around 3,000 MTons per year in 2050 out of which 81% will be powered by green hydrogen. (34% from hydrogen direct reduction and electric arc furnaces and 47% from hydrogen powered electric arc furnaces that use scrap steel).

In a multi-trillion dollars industry where an 80% stake is up for grabs, it was to be expected that companies would start to make moves and the recent news only reaffirms our outlook.

A few weeks ago, BMW Group and H2 Green Steel signed a final contract on the delivery of CO2 reduced steel. The agreement addresses BMW’s upstream scope 3 emissions and includes recycling and end-of-life management measures. The two companies agreed to have 40% of the pre-consumer steel scrap returned to H2 Green Steel’s electric arc furnaces for recycling.

The carbon tax that buyers will have to pay if the steel they use has been manufactured using fossil fuel processes will outweigh the premium paid upfront for green steel. This will signify yet another trigger for the looming role of hydrogen in the steel industry.