Sweden Advances on Road to Fossil-Free Steel With Three-Way JV

A Swedish joint venture that hopes to rewrite the rules of steel production took a major step forward on Monday.

Hybrit, an initiative run by steelmaker SSAB AB, iron ore producer LKAB and energy supplier Vattenfall AB, aims to remove fossil fuels from the steelmaking value chain by replacing coking coal with hydrogen and clean energy.

The project is now starting test operations for the production of fossil-free sponge iron — something that SSAB’s chief executive Martin Lindqvist sees as a “milestone” given the industry accounts for 7% of carbon dioxide emissions globally and 10% in Sweden, he said.

The Hybrit project aims to reduce CO2 emissions to 25 kilograms per metric ton of steel from about 1.6 tons by using hydrogen to produce direct reduced iron (DRI) as a feedstock, along with scrap, to make the metal. Electrolyzing water from renewable energy sources will generate the hydrogen.

–Grant Sporre, Bloomberg Intelligence

Product launch in a “big, commercial scale” is planned for the first quarter of 2026 and will target “the automotive industry and others,” Lindqvist said in an interview.