Steel manufacturing globally remains a big source of CO₂ emissions – and time is running out. This is why we are reinventing steelmaking by addressing the root cause of CO₂ emissions in the industry. Reinventing steelmaking means rethinking the whole production system.
SSAB has taken a policy decision to transform all our sites to fossil-free steel production. Our globally recognized brands such as Hardox® wear plate will be made with a significantly reduced carbon footprint. Our 140 years of experience ensures that the quality of all our well-known steels remains the same.
As a market leader in premium steels and steel plate in our Nordic and U.S. home markets, SSAB is responsible for the impact we make on our surroundings. We’re proud to already have reached this far in our journey towards a fossil-free future.
SSAB’s transformation of its Nordic production system is the first true steelmaking transformation in centuries. All five blast furnaces in Sweden and in Finland will be replaced by more flexible and cost-efficient mini-mills that run on electricity.
Luleå in Sweden and Raahe in Finland will get new mini-mills that are at the heart of the new Nordic production system. These mills are integrated steel production facilities with the capacity of carrying out all steps of steelmaking from melting fossil-free sponge iron and scrap to rolling products.
The new mills will typically have an electric arc furnace, a ladle furnace or vacuum furnace for precision control of chemistry, a strip or billet continuous caster for converting molten steel to solid form, a reheat furnace and a rolling mill.
Transforming our production system will not only considerably contribute to the reduction of CO2 emissions, but also make us even better placed for higher profitability.
Looking ahead, traditional steel will be more costly over time as free ETS allocations are gradually phased out and reach zero by 2034, leading to increased emission costs. Higher marginal costs with the existing blast furnace technology makes growth unsustainable and uneconomical. The ETS allocation and CO2 price make the EU cost curve “steeper” which supports healthier dynamics. Rebuilding our strip production system is also a leap toward a better cost position, greater flexibility, shorter lead times and more capacity for further processing. This allows us to meet customer demands for more dimensions in high-strength steels.
In a blast furnace, coal is used to remove the oxygen from the iron ore, and the end product is liquid iron. Since this process uses coal and produces large amounts of carbon dioxide, it is neither economically nor environmentally sustainable in the long term.
SSAB’s blast furnaces in the Nordics are already today among the most efficient in the world, emitting less than average amounts of CO2 emissions and using high-grade iron ore pellets and high-quality coke, but still our blast furnaces account for more than 90% of SSAB's CO2 emissions. This means that the blast furnaces have to be replaced by other technologies.
When transforming the Nordic production system, the blast furnaces will be decommissioned and electric arc furnaces (EAFs) will take their place in Oxelösund as well as in the new mini-mills projected for Luleå and Raahe.
In an EAF, recycled steel or fossil-free sponge iron is melted into liquid form. Since the electric arc furnace can be easily started and stopped on a regular basis, the mills can swiftly be adjusted to market demand, operating on 24-hour schedules when demand is high and cutting back production when sales are lower.
Resource scarcity, urbanization and climate change - combined with increasing need for new infrastructure - create a growing need for more sustainable solutions. Given their quality, SSAB’s high-strength steels have already enabled our customers to achieve CO2 savings. Our fossil-free steel will enable our customers to reduce their carbon footprints even further, safe in the knowledge that their products are manufactured from premium materials using only fossil-free energy sources.
Our strategy is to develop and offer fossil-free steel on a commercial basis already in 2026 as the first steel company in the world to do so. Together with our partners and customers, we will create fossil-free value chains, from the mine all the way to the end-product.
Customer demand for steel with no or low carbon footprint continues to increase. SSAB has delivered test batches of fossil-free steel to strategic customers. Feedback from customers has been positive and we can state that the properties of fossil-free steel are at least as good as those of blast furnace steel and that they meet all the requirements placed on our products.
SSAB Zero™ is steel made from recycled steel. It has near zero emissions during steel production, without mass balancing allocation of emission reduction or carbon emission offsetting. SSAB Zero™ is a near zero-emission steel in ironmaking, steelmaking and rolling, but not completely fossil-free, as the raw material is scrap. The recycled steel was originally produced with coal and fossil fuels.
SSAB Fossil-free™ steel is made with iron ore using HYBRIT® technology, i.e. the reducing agent in the direct-reduction process is fossil-free hydrogen.
The mining and steel industry in Sweden has been – and is – an invaluable strategic asset. It supplies steel to basically all large industrial manufacturers in the Nordics, as well as to a large number of small and medium-sized companies. Without domestic mining and steel production, the conditions for manufacturing industries in Sweden would significantly deteriorate.
SSAB’s green transformation is among the most important changes in the steel industry for decades. It’s not only about new technology that reduces carbon dioxide emissions to basically zero. We’re also introducing a new production logic that makes us faster, more flexible and more resistant to economic cycles.
This transformation meets the requirements of the global political agenda: reduction of emissions, green transition, jobs and competitiveness. For the transformation to become a reality, the required infrastructure must be in place in time as well as the availability of competitive fossil-free electricity.
Fossil-free energy will be key to enable the transition. The additional electricity demand at SSAB’s facilities in the Nordics after conversion will amount to approximately 4.5 TWh. This adds up to about 3 TWh more than today. Scaling up the pilot production of sponge iron to a commercial scale requires an additional 5 TWh within the framework of the HYBRIT collaboration with LKAB and Vattenfall.
All fossil-free power sources will be needed going forward and we assume that policy-makers will provide long-term conditions for securing competitively priced fossil-free electricity. The extension of transmission capacity must be rapid with as few lines as possible but with as much power as possible. When allocating capacity, both social and climate benefits will have to be taken into account to a greater extent than today. The existing capacity must in turn be optimized allowing for more flexible and precise usage.
Simplified, faster and more predictable permit processes for new mines, industrial facilities and power lines will be needed. As an example, environmental permit processes – similar to the EU Commission’s proposal in REPowerEU – should be shortened to a maximum of 12 months. Assessments should weigh together environmental, climate and social benefits in permit processes and land allocation.
We think that there should be a cost to emit CO2 and that there should be clear incentives for a quick transformation. It is positive that the EU has agreed on new rules for emissions trading with a clear timetable for phasing out emission allowance. It’s a leap forward that the system includes new, more CO2 efficient technologies such as hydrogen-based production.
In the proposal for the border adjustment mechanism (CBAM), it would have been good to take exports from the EU into account since they face different competitive conditions on global markets, for example steel produced in countries without costs for CO2 emissions.
To support frontrunners that develop breakthrough technologies, take risk and make green investments, there is a need for an enabling policy framework with the EU and on global markets, ensuring a level playing field. We think that government support and de-risking are relevant in the field of R&D and upscaling of new technologies. Public funding of already commercially available technology may entail an unwanted risk of a subsidy race.
To succeed in the transition, there is a need for effective frameworks, political leadership and action rather than general subsidies.
For a successful transformation to a new production system, the supply of skills is absolutely crucial. This places new demands on our know-how. Therefore we attach great importance to the further training of our staff.
SSAB has several internal development programs for different levels of the organization, such as an internal business development program and a training module for middle managers. We also have trainee programs, for example with a focus on digitalization. Moreover, we focus on competence development in connection with the planned transformation of the Nordic sites.
SSAB has also applied for funding from the EU’s Just Transition Fund for both competence and technological development in Luleå.
The second phase of the joint project FOSSA (Fossil-free Steel Applications) coordinated by SSAB Europe has received a positive financing decision from Business Finland. The project supports SSAB’s goal of building a fossil-free value chain from steel production to the end customer.
SSAB has signed a letter of intent for deliveries of fossil-free steel to Manitou Group. Deliveries are set to start in 2026 and ramp up as SSAB’s fossil-free steel production capacity increases. This agreement meets the ambitions of the two companies to significantly reduce their direct and indirect carbon emissions.
SSAB and John Deere Forestry Oy have signed a letter of intent on deliveries of fossil-free steel from 2026 onwards.