World’s first Green Steel Plant raises $4.6 billion in debt

Swedish startup H2 Green Steel AB secured its biggest ever financing package as it proceeds with the world’s first large-scale green steel plant in northern Sweden.

The firm signed agreements for a further €4.2 billion ($4.6 billion) in debt financing while also taking its total equity raising to €2.1 billion for the plant slated to come online early 2026, Chief Executive Officer Henrik Henriksson said at a press conference in Stockholm.

H2GS is among a new breed of steelmakers seeking to overhaul the way the alloy is manufactured in one of the most polluting industries in the world. The sector, which has relied largely on the same production techniques for more than a century, accounts for about 7% of global carbon emissions.

Among the company’s backers is investment firm Vargas Holding AB, which is also the founder of Northvolt AB, the Swedish battery maker that recently secured a $5 billion green loan to expand production at its factory in northern Sweden. Other backers of H2GS include include Kinnevik AB and Spotify Technology SA founder Daniel Ek.

The Stockholm-based steelmaker said it had signed agreements for €3.5 billion in senior debt and up to €600 million via a junior debt facility, according to a statement on Monday. The group of more than 20 lenders included Svensk Exportkredit, the European Investment Bank, together with commercial banks led by BNP Paribas SA, ING Groep NV, KfW IPEX-Bank Gmbh, Societe Generale SA and UniCredit SpA.

The latest funding spree was partly in response to a higher budget for the whole project that included additional infrastructure, according to the CEO. Speaking in an interview shortly after the press conference, Henriksson said, “It’s a sign of strength that we can raise this amount.”

On the equity side, the latest round saw H2 Green Steel raise an additional €300 million with new shareholders including the Microsoft Climate Innovation Fund, Mubea and Siemens Financial Services. US investment bank Morgan Stanley acted as an equity adviser to the company.

Henriksson though wouldn’t comment on any firm plans to list the company on the stock market, saying it’s a matter for the board. “We haven’t set a date for that yet,” he said.


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