European Investment Bank supports Austria’s only crude steel producer voestalpine in its mission to lower the environmental and carbon footprint of its activities.
Funds back the company’s four-year research and development programme up to 2028.
A focus will be on greentec steel, a plan to reduce CO2 emissions by up to 30% in 2029 compared to 2019 by partially replacing coal-based blast furnaces with electric arc furnaces powered by green electricity.
The European Investment Bank (EIB) is providing a loan of €300 million to voestalpine AG, Europe’s third largest steelmaker. The financing will be used for the company’s research and development (R&D) programme over a period of four years, with the goal to optimise manufacturing processes, increase energy and raw material efficiency, and extend product life. Overall, voestalpine aims to drastically reduce its environmental and carbon footprint by 2030 and to achieve carbon neutrality of its production by 2050.
“Steel manufacturing is responsible for a significant share of global CO2 emissions. At the same time, it is fundamental for the competitiveness and technological leadership of European industries and for millions of jobs across the continent. Therefore, we need to find ways to produce iron and steel more sustainably – R&D is key to doing so. I very much welcome our new cooperation with voestalpine, which will help to decarbonise their operations while delivering high-end products,” said Thomas Östros, EIB Vice-President in charge of activities in Austria.
Vestalpine will use the capital provided by the EIB to fund key research and innovation. “By continuing to invest in new products and processes, we can further secure our position as a global player in demanding product segments. Our R&D activities are primarily focused on digital and resource-saving products and processes. One of the main research topics we are currently looking into is greentec steel, a project voestalpine intends to use to become a quality leader in net-zero steel production in the future”, said CFO of voestalpine AG Gerald Mayer.
The steel and technology group is one of the most research-intensive companies in Austria, with around 800 R&D employees in 70 companies and 100 scientific partners worldwide.
Greentec steel is the group’s plan for green steel production. In a first step starting in 2027, voestalpine will cut its CO2 emissions by up to 30% by partially replacing its current coal-based blast furnace technology with electric arc furnace technology powered by green electricity. This represents almost 5% of Austria’s annual CO2 emissions, making greentec steel the country’s largest climate protection programme. voestalpine’s aim is CO2-neutral steel production by 2050.
Background information
The European steel industry is a global leader when it comes to innovation and environmental sustainability. It directly employs around 306 000 people, and through indirect and induced effects supports 2.5 million jobs. With a turnover of €130 billion the steel industry is a key sector in the European Union.
A competitive steel industry is fundamental for the technological leadership of European manufacturing industries. Construction, carmakers, mechanical engineering and the appliance industry are the main customers of European steelmakers. The success of their products, as well as the degree of innovation that enables them to stand out from other suppliers outside the European Union, are frequently determined by the technical performance and quality of the steel they use.