Iceland
November 6, 2025
Welcome to Luleå, the Arctic port city in northern Sweden that’s making global headlines – not for snow, hockey or northern lights, but for a massive transformation in the steel industry. Nestled on the edge of the Baltic Sea, this town of about 80,000 people is home to SSAB, one of Europe’s largest steel producers. And at the heart of it all is a giant, fire-breathing steel furnace that has long stood as both an industrial powerhouse – and a climate challenge.
This one furnace alone has been responsible for 8% of Sweden’s total CO₂ emissions. That’s right: a single piece of infrastructure, melting iron ore into steel, has been among the country’s biggest climate sinners. But now, thanks to groundbreaking innovation and bold investment, this fossil-fueled behemoth is about to go green – and it’s not just good news for the planet, but for the people of Norrbotten County too.
The End of Coal in Swedish Steel
Traditionally, steel production has relied on coke, a coal-derived fuel used to heat iron ore to high temperatures in blast furnaces. The result? Gigantic carbon emissions. But SSAB, in collaboration with HYBRIT (a joint venture between SSAB, Vattenfall and LKAB), has pioneered a revolutionary process: fossil-free steel made using hydrogen instead of coal.
The result is a process where green hydrogen, produced with renewable electricity, replaces coal in the reduction process. Instead of emitting CO₂, the only byproduct is water vapor. In 2026, SSAB plans to shut down the traditional blast furnace in Luleå and replace it with an electric arc furnace powered by fossil-free energy and fed with hydrogen-reduced iron.
What It Means for Luleå – and the Planet
The climate impact of this transition is enormous. SSAB estimates that converting its production process will reduce Sweden’s total CO₂ emissions by about 10%. That’s a staggering number in a country already known for its green ambitions.
But it’s not just the planet that benefits – Luleå itself is set for a boom. The green steel transition will bring:
- Thousands of new jobs in construction, infrastructure and technology
- A surge in demand for engineers, electricians and skilled tradespeople
- Growth in renewable energy infrastructure, including wind and hydro projects to power the green hydrogen production
- Increased global attention as Luleå becomes a hub for sustainable industry and innovation
With major companies like Volvo and Mercedes-Benz already placing orders for green steel, the demand is real – and growing fast.
The Big Picture
What’s happening in Luleå isn’t just a local upgrade – it’s a global model for climate-smart industry. In a world struggling to decarbonize heavy industries, Luleå is showing how bold innovation, collaboration, and political will can reshape even the dirtiest of sectors.
This is more than a furnace retrofit. It’s a climate milestone, a regional renaissance and a sign that green jobs and green industry can go hand in hand. Luleå’s steel is no longer just strong – it’s smart, sustainable and shaping the future.
