Stegra Boden Green Steel Plant

Sweden’s most expensive industrial bet in a generation is rising on a former marshland near the Arctic Circle. Stegra, the Stockholm-based startup formerly known as H2 Green Steel, is building what would be the first commercial-scale green steel mill in the world. The Boden plant replaces metallurgical coal with green hydrogen across the entire steelmaking flow, from iron-ore reduction through hot rolling. If it works at the planned 2.5 million-tonne-per-year output rate, it would cut roughly 95% of CO2 emissions versus a comparable blast-furnace mill.

Project Scope

The Boden site covers 240 hectares and integrates four major industrial blocks. A 700 MW hydrogen electrolyzer plant, supplied with hydropower from the Lule River, produces the green hydrogen feedstock. A Midrex-licensed direct reduction (DRI) plant turns iron-ore pellets into sponge iron using that hydrogen instead of coal-derived syngas. An electric arc furnace and rolling mill complex from SMS Group converts the sponge iron into hot- and cold-rolled steel coils, and a 150,000 square meter cold mill building, under construction by Logistic Contractor, houses the downstream rolling, finishing and warehousing operations.

Construction started in mid-2022. Financing has been assembled in tranches, most recently a €1.4 billion package closed in early 2026 that backstops completion. Total project cost is now estimated at roughly €6.5 billion, with first commercial output of green steel targeted for 2027. Stegra has signed pre-orders with Mercedes-Benz, Scania, BMW, Volvo Cars and Porsche, covering a meaningful slice of nameplate capacity through 2030.

Why It Matters

Boden is the first project at this scale to actually break ground on hydrogen-direct-reduced steel. Multiple competing pilots are running across Germany, Spain and South Korea, but Stegra’s is the only one with the full hydrogen-to-cold-coil flow integrated on a single site at commercial scale. It is also one of the largest single-site capex deployments in Swedish industrial history.

The economics are not yet universal. Boden works because it sits on top of abundant, low-cost Nordic hydropower, on a rail line that connects to Luleå’s deepwater port, and inside an EU emissions-trading regime that prices carbon at levels that close most of the cost gap with conventional steel. Replicating the model in a region without those three conditions is a different question, and one that European policymakers are watching closely. If Stegra ramps cleanly, the next wave of green steel investments in Sweden, Finland and northern Spain becomes much easier to underwrite.

Project Team & Details