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Stegra has raised around USD 1.7 billion to complete its hydrogen-based steel plant in northern Sweden, strengthening one of Europe's key green industrial projects. The funding, led by the Wallenberg family along with global investors like Temasek and IMAS, will support construction, cover rising costs, and provide financial stability. The project has faced delays due to challenges in scaling green hydrogen and cost pressures. Despite this, investor participation indicates continued confidence in low-emission steel production and long-term industrial decarbonisation efforts.
Stegra has secured funding of about USD 1.7 billion (EUR 1.4 billion) from a group of investors led by Sweden's Wallenberg family to complete its hydrogen-based steel plant in northern Sweden. The company had been in discussions to raise additional capital for several months to ensure the project moves forward without further disruption. The plant is one of the few large-scale green steel projects currently under active development in Europe. Advertisement
The funding round saw participation from global investors including Temasek and IMAS, along with support from existing shareholders and lenders. The transaction remains subject to final approvals but is expected to improve the company's financial position and support the remaining construction work as well as initial operational readiness.
Chief executive Henrik Henriksson indicated that the funding reflected strong confidence from investors and lenders in the company's model and its ability to execute the project. He conveyed that the capital raised would also act as a buffer, reducing the need for additional fundraising during the construction phase and helping manage cost uncertainties.
The project has faced delays earlier due to rising construction costs and broader challenges linked to scaling green hydrogen technology. Timelines have been pushed back, with earlier expectations pointing to a phased start of production around 2027. At the same time, the company noted that customers have remained flexible on delivery schedules, as green steel can be integrated with conventional steel in various industrial uses without major disruption.
The facility is being developed in Boden and is designed to produce steel using hydrogen generated from renewable electricity, replacing coal-based processes. This approach is expected to significantly reduce carbon emissions compared to traditional steelmaking. The project forms part of Europe's broader effort to reduce emissions from heavy industries, especially steel, which remains one of the most carbon-intensive sectors.
The latest funding comes at a time when several green steel projects across Europe have been delayed, scaled down, or reconsidered due to high capital requirements and uncertainties around hydrogen costs and infrastructure. Against this backdrop, Stegra's ability to raise a large amount of capital highlights continued investor interest in projects focused on industrial decarbonisation, even as risks remain.
The company, earlier known as H2 Green Steel, had previously secured funding through a mix of equity, debt, and public support. However, increasing project costs and the need for additional infrastructure investment had made further fundraising necessary to ensure completion and maintain project timelines.
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