In a groundbreaking move, H2 Green Steel—Sweden's emerging titan in the eco-friendly steel industry—has secured an awe-inspiring €1.5 billion in equity funding. This herculean financial leap is engineered to propel the construction and activation of an innovative, large-scale green steel facility in the heart of Sweden.
Oh, but that's not all. The fundraising extravaganza, orchestrated by the clean hydrogen infrastructure fund Hy24, will also fuel the creation of Europe's most gigantic electrolyzer. The ultimate game plan? To equip H2 Green Steel with the renewable hydrogen required to kick coal to the curb in their steelmaking protocols.
Anticipation hangs thick as H2 Green Steel aspires to unleash this avant-garde plant by the end of 2025. Envision steel manufacturing with a jaw-dropping 95% reduction in carbon emissions vis-a-vis traditional blast furnace methodologies.
A star-studded lineup of investors orchestrated this financial symphony. Incumbent backers such as Altor, GIC, and Just Climate made their presence felt, while newcomers Andra AP-fonden and Temasek joined the funding chorus. They stand shoulder-to-shoulder with the likes of AMF, Cristina Stenbeck, Hitachi Energy, and other notables, constituting the financial backbone of this green steel venture.
Henrik Henriksson, CEO of H2 Green Steel, hailed the "impressive" calibre of investors backing his firm.
"Some of the most professional institutions, investors and industrial companies globally are part of this round, and we are proud that they all share our commitment to sustainability as their true north," he said. "€1.5bn is the largest private placement in Europe this year, and the appetite to invest in us proves our solid business case and the market demand for green steel."
In its short history—back to only 2021—H2 Green Steel has hit it out of the park by raising over €1.8 billion through three funding rounds. The latest investment thrusts the firm into the €3.5 billion debt financing stratosphere.
Otto Gernandt, CFO of H2 Green Steel, said the cash injection marked "the start of industrial scale decarbonization of basic materials production".
"The sector will require substantial investments over the coming decades to enable our customers to produce green end products and, thereby, meet their climate targets," he said. "We hope this financing will contribute towards accelerating the much needed, broad participation of capital markets in the transformation of hard-to-abate industries".
All this buzz unfolds hot on the heels of Boston Metal, a U.S.-based green steel startup, closing its Series C round with a cool $262 million. Boston Metal aims to revolutionize the steel and metal sector, leveraging a host of high-value metals and pioneering technologies.
Among Boston Metal's latest investors are venture capital wings from energy colossus Aramco, investment behemoth M&G Investments, natural resource fund Goehring & Rozencwajg, and the powerhouse investment management firm Baillie Gifford.
"Boston Metal's success in raising capital from diverse sources spanning private equity, venture capital, institutional investors and strategic investors demonstrates robust confidence in Boston Metal's ability to transform steel and metals production for a sustainable future," said Tadeu Carneiro, chairman and CEO at Boston Metal. "Our high-value metals business is nearing commercialization at our subsidiary in Brazil, with our manufacturing facility opening this fall, and we continue to make significant progress on the scale-up of molten oxide electrolysis for green steel production at our pilot plant outside of Boston."
Existing investor Breakthrough Energy Ventures - the climate technology fund founded by Bill Gates - also joined the Series C funding round alongside several other prior investors, including Microsoft's Climate Innovation Fund, BHP Ventures, and Prelude Ventures.
"Boston Metal has made remarkable progress on the maturation of its molten oxide electrolysis technology and business model, which has the potential to decarbonize steelmaking at scale while delivering significant value and sustainability benefits for the metals industry," said Carmichael Roberts, co-lead of the investment committee at Breakthrough Energy Ventures. "We're proud to continue our investment in the company, as it's an example of the high-impact technology we seek to support solving the world's most pressing climate problems."