H2 Green Steel, which produces steel using green hydrogen in the process, has secured loans while increasing its equity capital. In total, the company has secured nearly €6.5 billion in financing to build the world’s first large-scale green steel plant in northern Sweden.

H2 Green Steel has signed a €4.2 billion debt financing package: €3.5 billion of senior debt and a junior debt facility of up to €600 million. There are 20 lenders in all, including Svensk Exportkredit (SEK) and the European Investment Bank, as well as commercial banks led by BNP Paribas, ING, KfW IPEX-Bank, Société Générale and UniCredit. H2 Green Steel has also raised almost €300 million in additional equity, bringing total equity funding to a total of €2.1 billion. The new shareholders include Microsoft Climate Innovation Fund, Mubea and Siemens Financial Services.

Last September, the company raised €1.5 billion in equity, making it the largest private placement of 2023 in Europe. Hy24 was one of the investors.

H2 Green Steel’s massive and unique commitment to decarbonise hard-to-abate industries

H2 Green Steel has also signed a €250 million grant agreement under the Innovation Fund* through the European Climate, Infrastructure and Environment Executive Agency (CINEA). In total, the company can benefit from €6.5 billion for its project.

“This massive commitment from our lenders, investors and the Innovation Fund is true recognition of the quality of our company. It’s also a big win for the climate as we hope the model will inspire the financing of other decarbonization initiatives in hard-to-abate industries,” says Henrik Henriksson, CEO of H2 Green Steel.

You can read the company’s press release here.

*The Innovation Fund is financed by the European Union’s Emissions Trading System and supports innovative projects that aim to speed up decarbonization of European industry and accelerate the green transition. 

Article written by Laurent Meillaud and translated by Logan King