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One of the world’s largest steelmakers has deployed a novel heat battery at its plant in India to curb emissions from its dirty, energy-intensive operations.
Tata Steel is using the 20-megawatt-hour thermal-storage system, developed by the German startup Kraftblock, at a massive steel mill in Jamshedpur, in the eastern state of Jharkhand. The technology captures waste heat that’s generated during an early stage of the steelmaking process, then repurposes that heat to replace fossil gas used within the plant.
On Friday, the companies announced the project for the first time and shared the initial results. Kraftblock has been operating the heat battery since last May as part of a one-year test run with Tata Steel.
Based on how well the system has performed so far, the cleantech firm expects its thermal-storage technology will reduce the site’s carbon dioxide emissions by 22,000 metric tons per year — about the same as taking 5,100 gas-fueled cars off the road — and will eliminate about 110 gigawatt-hours of fossil-gas use per year.
“It’s performing better than we calculated,” Martin Schichtel, Kraftblock’s CEO and co-founder, told Canary Media.
The project is likely the first of its kind within the steel industry, experts say. But manufacturers in other industrial sectors are increasingly testing out thermal-storage technology as they look for cleaner ways to produce the scorching heat they need to make ceramics, chemicals, dairy products, and processed food and drinks.
Some of these systems draw electricity from the grid to generate and store heat in specialized bricks, rocks, or salt. They then supply that heat to industrial furnaces and boilers whenever companies need it. Kraftblock, which launched in 2014, operates a system like this at a PepsiCo factory in the Netherlands, where heat batteries are used instead of fossil gas to deliver steam and hot oil for frying potato chips. The company has developed a “stonelike” storage material from byproducts such as steel slag and copper-mine waste, Schichtel said.
Kraftblock’s system in India charges up using the excess heat from industrial processes, not electricity. Schichtel said that hard-to-decarbonize sectors like steelmaking have a “huge” potential to harness more of their waste heat, which is typically just lost to the air.
At the Tata Steel site, two Kraftblock units are connected to the “sinter” plant by a maze of thick silver pipes. Sintering is a highly energy-intensive process in which iron ore, limestone, and other materials are heated together to make lumps that are fed into blast furnaces — the hulking coal-fueled facilities that produce iron, the main ingredient in steel.
Tata Steel primarily uses fossil gas to generate heat to make the sinter, and later runs the finished product through large circular equipment to cool it back down. Kraftblock’s technology gathers the thermal energy that the cooled-off sinter releases and stores it in the batteries — at up to 500 degrees Celsius (932 degrees Fahrenheit). Tata Steel can then tap those batteries to warm the water needed for the sintering process.
Kraftblock’s system “enables us to significantly reduce our fossil energy consumption and emissions while improving process efficiency,” Subodh Pandey, Tata Steel’s vice president of technology, R&D, new materials business, and graphene, said in a statement to Canary Media. “This project is a significant step towards a greener, more energy and cost-efficient steel industry.”
Kraftblock declined to say how much its 20-MWh system cost to build or operate. But Schichtel said the project was developed without any subsidies, a fact that reflects the growing regulatory pressure facing Indian steelmakers. India is set to launch a carbon-credit trading scheme this year, and the European Union recently enacted a carbon-border tariff on polluting imports, which applies to metal from India.
Such policies are “definitely supportive” of clean technologies like Kraftblock’s, Schichtel said.
Globally, steelmaking accounts for between 7% and 9% of human-caused greenhouse gas emissions. Most of that pollution comes from heating coal in blast furnaces — a chemical process that can’t be directly replaced with thermal-storage systems. Steelmakers are pursuing other low-carbon methods instead, including producing iron using green hydrogen or with novel electrochemical processes.
Tata Steel, for its part, recently announced plans to invest $1.2 billion in advanced technologies at its Jamshedpur plant that are designed to reduce coal use in the ironmaking process and will capture carbon emissions from the steel mill.
Still, heat batteries like Kraftblock’s could provide a key way for steelmakers to start cleaning up their existing facilities today, even as they work to solve the much harder, longer-term challenge of fully decarbonizing, said Kaitlyn Ramirez, a senior associate in the Climate-Aligned Industries Program at RMI, a clean energy think tank.
Curbing steelmakers’ energy use is especially crucial, given how much renewable power cleaner steel mills are expected to need for steps like producing green hydrogen and operating electricity-driven furnaces and reactors. “Every amount of energy that we can reduce or make more efficient … makes the ultimate transition to near-zero [steel] production easier and much more feasible in the near term,” Ramirez said.
Kraftblock is part of the climatetech accelerator Third Derivative, run by RMI. The startup joined last year’s “industrial innovation cohort,” along with other industrial-heat-focused companies such as Advanced Thermovoltaic Systems, HyperHeat, and Noc Energy.
Nick Yavorsky, a senior associate at RMI who works with Third Derivative cohorts, said his team thought that Kraftblock was “on a very successful commercial pathway.” The startup had already raised 20 million euros ($23.6 million) in Series B financing when it joined the accelerator, and it had already deployed its thermal-storage technology at the Netherlands PepsiCo plant and at a ceramic manufacturing facility in Germany.
The Tata Steel project is “kind of a beacon” for thermal-storage startups looking to break into the steel sector, Yavorsky said. He added that he sees significant potential for scaling Kraftblock’s technology. Beyond the carbon-intensive blast furnace, steelmaking involves over a dozen upstream and downstream processes that require lots of energy and generate plenty of heat.
Worldwide, steelmakers operate over 480 integrated iron- and steelmaking facilities, according to Global Energy Monitor. India’s steel sector is growing particularly fast, and much of that new capacity is still expected to rely heavily on coal, underscoring the need to slash steel-related emissions wherever possible.
Schichtel said that Kraftblock and Tata Steel could consider expanding the heat-battery project after the full year of operations. He noted that the startup’s technology can store and manage heat up to 1,300 degrees Celsius (2,372 degrees Fahrenheit) — much higher than the sinter plant requires — which enables its technology to harness waste heat from a wide range of industrial processes.
“Not all steel mills will convert to hydrogen [ironmaking] within the next five or 10 years, right?” he said. “So each step you can do to minimize emissions, to increase energy efficiency for existing systems, is highly value-added.”
A correction was made on March 2, 2026: This story originally said that Third Derivative was run by RMI and New Energy Nexus. While New Energy Nexus co-founded Third Derivative, it is now run solely by RMI.
Hi everyone and welcome. My name is Matias Sundine. I am the editor-in-chief of Warp News and the founder of Warp Institute, a foundation I started a few years ago. Warp Institute is part of Project Energy Society, and the goal there is to use the logic from how the internet is built and apply that to the energy system, the energy grid. This means you will end up with an abundance of energy, and not just any energy, but clean green energy. We think that will really shift the mindset of humanity because we are, of course, super dependent on energy. We have always been and we still are, because it is expensive or damaging to the planet. But that is changing now with technology.
If you put these things together and, as I said, borrow the logic from the internet, we think we can get to an abundance of energy. When you have an abundance of energy, when you do not have to think about the last drop of energy and how we are going to use it, that would shift how we think about things and the things we do. We will do many new things that we thought would be unimaginable today. The leader of this project is Yunas Spirishon and he and his team in Lund have been working on this. I heard this idea from Yunas three years ago and immediately understood this was really something, because when you have dropping costs on solar and batteries and all that, you see the components are already there but everything is getting less expensive. I immediately understood this was a really good idea and a really good theory, but so far it had been a theory. A good one, but still a theory. Now it is not a theory anymore. Recently in Lund, Yunas, you pushed a button and something happened.
Yes, exactly. Matias, thank you for having this call and thank you for supporting us over the last three years. We believe that Energy Society is really the next paradigm shift. This last Saturday we took a really important step because we now have the world’s first operational energy net, as we call it, between two different buildings. We have a freedom cable between them. They are two separate buildings owned by two different real estate companies. There is an office, some apartments, a gym, a lot of mobility spaces like parking spaces, and also a grocery store. They are connected with an independent parallel electrical grid, or as we call it, the freedom cable. There is an energy router in each building. There is solar and there are batteries on both sides, and they can now exchange electricity without paying for distribution, which today is the largest cost component of the Swedish electrical system and is planned to increase dramatically due to large investments in the traditional grid. Apart from the cable and the routers, we now also have the energy router operating system, or OS, because sharing energy is sharing love. It talks to the network management system, which then talks to the BSS OSS system. My company, via ROPA, is thrilled to become the world’s first Energyet operator, helping the real estate companies that make these investments not only with the project but also with running it daily, managing the system and the interactions between these local nodes and the traditional electrical grid. All the key components are here and we have verified them. Everything works and we are ready to start scaling this. One key aspect is exactly what you talked about, Matias: hyperscale. Everything we use is commercial off-the-shelf components. The critical thing that made this practical and financially viable is that the power electronics in the routers are the same components used in electric vehicles. These are the components that transfer energy from a charger to a car battery. They are price-effective and commercially available. By comparison, upgrading a transformer in the traditional Swedish grid can take five to seven years. If we are in a pinch and pay extra for transport, we can get these power electronic components in five to seven hours. The cost difference is about a thousand to one in distribution.
One story from the development team shows exactly what Warp News is about, the exponential development of hyperscale components. We started in the low-voltage space, which in the EU means one thousand volts and below, operating at 800 DC volts because that was the maximum of the components. During the process, a new generation of power electronics from chargers became available. Apparently, humans do not like to wait, so we now have 1500 volt DC components we can use. Even before serial production, the amount of energy we can transfer on the same freedom cable has basically doubled because we are on the right technical trajectory and price performance curve. As vehicles, chargers, buildings, neighborhoods, and cities adopt this, volumes increase and prices drop further. It is surprising that many people miss this. Battery costs have dropped 90 percent in ten years and will continue to drop as production increases.
If you compare this to the internet, we are at a stage similar to ARPANET. Instead of four university nodes, we have these two connected real estate nodes, but it is a full technology stack. The energy protocol is published, open, and free, just like IP. Anyone can build a compatible energy router. We believe hundreds or thousands of people should produce their own routers and let the best win. What is best varies. We can have diversity of vendors, local production, and independent energy systems that can still share resources with neighbors and larger networks without distribution cost if desired. In Sweden, which already has one of the best and cheapest grids in Europe, it is profitable to build this parallel architecture. If it works here, it should work in many places worldwide. In the US, more than 11,000 projects are waiting to connect to the traditional grid, which would double production, and 90 percent are wind, batteries, and solar because they are cheaper and easier. Energy net can also be built super robust. The traditional grid is too sensitive. With internet architecture applied to energy, there is no single point of failure. It becomes super resilient.
This has changed my thinking. At first, I saw abundance and positive effects. Today, with Russia’s war against Ukraine and geopolitical uncertainty, this project has become very important for security. Thousands of small networks are far more resilient than a centralized grid. Even if cut off, you still have some electricity, which makes a huge difference in crisis or war. It is important for Europe’s security and competitiveness.
Now that we are live with real deployments, the next step is to scale. Just as Sweden pioneered modern broadband and digital telephony by combining innovation with new infrastructure, we can break the gridlock in the traditional grid. Filling suitable Swedish roofs with solar could generate over 50 terawatt hours per year, while Sweden consumes about 150 terawatt hours annually. This clean, cheap, resilient local energy is market-paid, not subsidized. It frees capacity in the traditional grid for industrial and transportation transition. It is the cheapest, fastest, and most secure way to accelerate the green transition. If it works in Sweden, it can work even better in many other European grids and eventually worldwide with policy adaptations. Who does not love clean green energy that you can run independently in your backyard together with your neighbors?
If you want to follow developments in the Energy Society, we report on them regularly at Warp News. Sign up for our free newsletter at warpnews.org to receive updates once a week. Thank you very much, and thank you Yonas for chatting with us. Remember, Energy Society will be built by all of us together. Energyet is an open free standard and you can start building your own energy independence right now.
Factories that make essential materials like steel and cement need scorching-hot air and steam to transform raw ingredients into finished products. Traditionally, they get that heat by burning fossil fuels. But the startup Electrified Thermal Solutions is pursuing a far cleaner approach: tapping piles of bricks.
The Boston-based company has developed a thermal battery system that uses electricity to heat metal-oxide firebricks for hours at a time. The goal is to soak up wind and solar power from the grid during cheaper off-peak periods, then deliver the stored heat to industrial furnaces, boilers, and kilns whenever manufacturers need it.
Now, Electrified Thermal is putting its technology to the test. Last week, the MIT spin-off unveiled its first commercial-scale thermal battery at the Southwest Research Institute in San Antonio. Its Joule Hive system can store 20 megawatt-hours of heat at temperatures of up to 1,800 degrees Celsius (3,270 degrees Fahrenheit).
“That is hot enough to do the job of fossil fuels in virtually any application,” said Daniel Stack, Electrified Thermal’s CEO and co-founder. “We’re talking about making cement, steel, chemicals, and glass, but also things like potato chips, which need steam generation for food processing.”
From the outside, the Joule Hive heat battery resembles a truncated shipping container connected to pipes and wires. Its insulated steel walls enclose stacks of firebricks, which are charged up by running clean electricity directly through them. The thermal energy is then discharged by running air through the brick stacks that can be piped as hot gas directly into factories.
The unit in San Antonio will allow manufacturers to “kick the tires” to see how the system works, including for on-site testing of minerals drying and other materials processing, Stack said. Electrified Thermal is poised to start delivering its first units to customers’ facilities at the end of this year or in early 2027, he added.
The startup is also partnering with ArcelorMittal to test the thermal-storage technology at the steelmaker’s R&D facility in Spain, and the two are considering piloting the system at a steel plant, where it could potentially replace the fossil-gas heat that is used to shape and strengthen the metal. ArcelorMittal and other global industrial giants, including cement-maker Holcim and iron-ore producer Vale, have invested in the firm.
“Industry has taken notice, and they’ve been very engaged in adopting electrified heating into their processes to try and reduce [energy] costs and cut emissions,” Stack said.
Electrified Thermal is one of more than two dozen startups that are attempting to clean up heavy industries by harnessing thermal storage, using not just specialized bricks but also materials such as crushed rock, molten salt, and sand. By banking low-cost renewable power from the grid, the firms aim to deliver heat that’s even cheaper than fossil gas — a formidable challenge for projects in U.S. regions where gas is abundant and inexpensive.
Thermal storage “has rapidly become one of the fastest-growing areas of interest within emerging storage technologies,” said Yiyi Zhou, a clean energy specialist at BloombergNEF, who added that the approach “offers its strongest potential in long-duration, heat-linked applications,” like the ones that Electrified Thermal has focused on.
Startups in this fledgling sector raised about $200 million in venture capital in 2025 from about a dozen disclosed deals, according to the consultancy Cleantech Group. In 2024, the sector raised close to $300 million — a total that includes a $150 million investment in Antora Energy, a California-based company that uses graphite blocks to generate intense beams of heat.
Electrified Thermal, for its part, says it has raised over $23 million in private capital since launching in 2021.
“It’s an exciting space, just given the overall need for electrified solutions in the sectors that thermal-energy storage companies are working in,” said Zainab Gilani, a research associate focused on energy and power at Cleantech Group. “The problem is definitely immense.”
Industrial heat accounts for about one-fifth of the world’s energy consumption and contributes a significant share of planet-warming pollution globally. In the United States, direct heat use in factories is responsible for roughly 13% of the country’s energy-related carbon emissions.
About three-quarters of those U.S. thermal emissions are the result of low- and medium-temperature processes that produce everyday goods like milk, beer, toilet paper, and bleach. In many cases, electric versions of boilers, ovens, and dryers can already replace the fossil-fueled heating systems in those factories.
But higher temperatures are harder to achieve using electrified equipment, since the extreme conditions can quickly destroy their metallic wires and heating rods, Stack said. For startups like Electrified Thermal, the idea is to design systems that can provide “flame temperature” heat for decades before they need replacing, he added.
Only a handful of industrial-scale thermal storage systems have actually been installed to date worldwide, and many additional projects are needed to build up manufacturers’ confidence in this approach, Gilani said.
Rondo Energy, for example, began operating its first 100-megawatt-hour heat battery last October in a rather counterintuitive place: the oil fields of Kern County, California. The battery’s heat generates steam that is injected into oil wells to increase production, a job previously done by a gas-fired boiler. According to Rondo, the project is a necessary step that allows the startup to secure a paying customer as it scales the technology to decarbonize other industries.
Finding cost-effective projects in the U.S. is especially key now that the Trump administration has canceled hundreds of millions of dollars in Department of Energy awards for industrial decarbonization efforts. The defunded projects included ones that planned to use Rondo heat batteries: a plastics-recycling facility in Texas and beverage-production sites in Kentucky and Illinois.
Electrified Thermal, meanwhile, was set to supply its technology to the ISP Chemicals plant in Calvert City, Kentucky. In 2024, the manufacturer was selected for up to $35.2 million in federal grants to replace gas boilers with the thermal battery. But ISP Chemicals later withdrew from award negotiations, according to the DOE’s website, and Stack confirmed that the project is “halted at this time.”
Still, he said, Electrified Thermal remains focused on deploying its first large-scale projects this year and next, and aims to install 2 gigawatts of thermal power capacity by 2030.
The success of thermal storage projects will largely hinge on their ability to deliver heat that’s cheaper than fossil gas — and for that, they’ll need wider access to wholesale energy markets. In certain places, the price of wind and solar power can drop to zero or even be negative when supplies exceed electricity demand for hours at a time. But most industrial customers buy their power from utilities at retail rates, which excludes them from tapping that cheap clean electricity.
In Texas and Europe, however, companies can more readily access those ultralow rates, and tech providers are pushing utilities and regulators in more U.S. states to similarly open their wholesale markets to industrial users.
“Thermal batteries as an asset class are very new, and so the rules were not written with their existence in mind,” Stack said. “We would benefit from opening that market in more geographical areas of the United States.” This includes California, where renewables are so abundant that a large portion of that supply is curtailed when there’s not enough demand.
Stack called the deployment of that first unit in San Antonio a “pivotal moment” for the company. “We’ve turned on a system now that meets industry where they are, and can electrify them while saving them money on their heating bill,” he said. “And I don’t see anything that stops us from mass deployments.”
Tesla is rededicating itself to rooftop solar, a decade after it bought the then-leading company in that sector, SolarCity.
The pioneering electric car maker has continued to sell rooftop solar through its energy division since the SolarCity acquisition. But the Solar Roof product — essentially roof tiles that generate energy and which was touted in 2016 as a reason for investors to approve the acquisition — never achieved the pacesetting status that Tesla’s Powerwall did for home storage or its Megapack did for large grid batteries.
On Thursday, a day after reporting year-end earnings for 2025, Tesla unveiled its newest energy product during an event at the company’s retrofuturist Tesla Diner in Los Angeles. And the buzzy new item is, in fact, a rooftop solar panel, launched at a tumultuous moment for both Tesla and the residential solar market.
“This is the first time that we’ve actually fully designed and manufactured our own solar panel, aside from everything that we’ve been doing on the Solar Roof,” said Colby Hastings, who runs the residential energy business at Tesla Energy. “This is available now. This is very real-world.”
Tesla has already begun manufacturing the new panel at its factory in Buffalo, New York, where it built a line capable of more than 300 megawatts of annual production, with room to grow, Hastings said. Tesla also assembles the Solar Roof at that location.
The new design offers “superior aesthetics,” Hastings said, thanks to its low-profile, all-black appearance, with no visible bus ribbon needed to conduct electricity from the cells. Tesla also leaned on its dataset of 500,000 solar installations performed by its in-house teams, Hastings said, to streamline the parts needed to secure the modules to a roof. For instance, the new panel cuts out the rail architecture typically used to fasten panels.
“We’re always looking for ways to eliminate unnecessary pieces and improve time,” Hastings said.
On Wednesday, Tesla reported a drop in revenue (its first full-year revenue drop), vehicle deliveries, and gross profit for the full year 2025. Perhaps the company’s most surprising announcement, though, was that it plans to scrap production of its Model S and Model X cars and instead use those factories to manufacture bipedal automatons. (The solar panels, however, will still be “proudly made on Earth by humans,” per company materials.)
While Tesla’s core business suffered last year, its energy division shone brightly — as automotive revenues fell by 10% for the year, “energy generation and storage revenue” grew by 27%, though the division still makes far less money than its core business. The company deployed an immense 46.7 gigawatt-hours of storage in 2025, more than 10 times the rate just four years prior. But while Tesla freely discloses battery capacity delivered by its generation and storage business, it does not share solar capacity deployed, making it hard to gauge the significance of solar relative to energy storage.
As with Tesla’s vehicle sales, the rooftop solar market is experiencing a downturn. First California, the biggest residential market by far, overhauled the rules for solar compensation in a way that crushed sales. Then the Republican-backed budget law ended the federal tax credit for households that buy their own rooftop solar systems. However, that law kept a tax credit for systems leased by third parties.
Tesla launched a lease offer last year to monetize those remaining tax credits; customers can choose to buy out their systems after five years. As a U.S.-based domestic manufacturer, the company also should be able to claim the advanced manufacturing production credit (45X) for its production in Buffalo.
So in spite of the market turbulence, Tesla can still avail itself of supportive federal policies even though the budget law passed — over the protestations of CEO Elon Musk. But Tesla is far from alone in making solar panels in America these days: It will be competing against the likes of Qcells, the most prolific manufacturer of residential panels in the U.S., which operates more than 8 gigawatts of module capacity, compared with Tesla’s 300 megawatts.
Scale matters in this industry. Lacking that, Tesla does have an advantage: its connected ecosystem of home energy products.
“To my knowledge, we’re the only manufacturer out there that’s directly producing electric vehicles, charging, storage, mounting hardware, solar panels, all of the controls that you can use to integrate these devices and make them work together for your home, and one app to have that full experience in,” Hastings said.
That could be enough to carve out a profitable niche in what’s left of the U.S. rooftop solar market in the second Trump administration.
Stegra’s grand plan to build the first large green-steel mill in the world has recently hit a rough patch. Faced with increasing project costs and construction delays, the Swedish startup has been seeking to raise over $1 billion in additional financing since last fall to complete the flagship facility near the Arctic Circle.
Last week, though, Stegra shared some brighter news: The company landed a major new customer, marking a step forward for the beleaguered project.
A subsidiary of the German conglomerate Thyssenkrupp has agreed to buy a certain type of steel from Stegra’s plant in northern Sweden, which is set to start operations next year. The plant will use green hydrogen — made with renewable energy — and clean electricity to produce iron and steel. The sprawling facility is expected to initially produce 2.5 million metric tons of steel annually and eventually double its production of the metal.
Stegra, formerly H2 Green Steel, estimates that its process will slash carbon dioxide emissions by up to 95% compared with traditional coal-based methods, which account for up to 9% of global emissions.
Thyssenkrupp Materials Services said it would buy tonnages in the “high-six-digit range” of “non-prime” steel — metal that doesn’t meet the high-quality standards required for certain uses but that is still strong and durable enough for other applications. Steel mills typically produce a higher ratio of non-prime metal when they’re starting up, which decreases over time, according to Stegra. The deal should help the firm generate cash flow when the plant first opens.
“A partner for non-prime steel is important for the ramp up of our steel mill,” Stephan Flapper, head of commercial at Stegra, said in a Jan. 12 statement. “Together we can drive an even stronger pull for steel products made via the green hydrogen route.”
The deal is Stegra’s first for non-prime steel, though the startup has already inked agreements for prime steel with automakers such as Mercedes-Benz, Porsche, and Scania, as well as major companies including Cargill, Ikea, and Microsoft. The offtake contracts represent more than half the steel that will be produced during the plant’s first phase.
Notably, Thyssenkrupp Materials Services won’t count the carbon-emission reductions associated with the green steel toward its own climate targets. Instead, Stegra will separately sell the green credentials, in the form of environmental attribute certificates, to other customers in the prime steel market. Stegra previously struck a deal to sell certificates to Microsoft — which is an investor — to help offset emissions from conventionally made steel that the tech giant is using to build data centers outside Europe.
The startup’s announcement with the Thyssenkrupp subsidiary didn’t include details about the financial value or other parameters of the multiyear agreement. Stegra didn’t respond to Canary Media’s requests for comment.
Analysts said the lack of specifics makes it difficult to know exactly how meaningful this development is for the Swedish steelmaker as it works to address its financial challenges.
“This gives a positive signal … that they’re moving in the right direction,” said Anne-Sophie Corbeau, a Paris-based hydrogen analyst at Columbia University’s Center on Global Energy Policy. “But it’s really complicated to quantify how significant this is.”
The new deal with Thyssenkrupp and the previous one with Microsoft “suggest Stegra has a technically sound product,” Brian Murphy, head of hydrogen and low-carbon gas for S&P Global Energy, said by email. He added that, in general, signing long-term offtake deals for clean-hydrogen projects has become “the key unlock” for developers to secure necessary financing.
Still, “more price information is required to assess the full impact on Stegra’s financial position,” he said.
Stegra is forging ahead with its multibillion-dollar project even as other European steelmakers put their hydrogen-fueled ambitions on ice.
Last year, Thyssenkrupp Steel and the industrial giant ArcelorMittal said they were canceling or postponing projects in Europe, citing the economic headwinds and uncertain market conditions facing green steel and hydrogen production. The setbacks come even as the European Union is increasing regulatory pressure on steelmakers inside the bloc and globally to curb CO2 emissions from industrial facilities. In the United States, meanwhile, plans for two marquee green-steel projects were shelved last year.
Construction on Stegra’s plant in northern Sweden was 60% complete as of late October, and the company continues to share snapshots of ongoing work at its snow-covered site on social media. Stegra’s success, if it comes, could reinvigorate green-steel efforts across the region, particularly if the company can sell its steel at prices that cover the higher costs of making low-carbon metal, Corbeau said.
“In the end, if the economics work and they manage to sell most of the steel at a premium, that will be a good signal for a lot of the other companies that have been hesitant,” she said.
I spent much of 2024 writing about the ambitious plans that U.S. steelmakers had to clean up the coal-reliant industry. But by the start of 2025, it was fast becoming clear that those green-steel dreams were in serious trouble.
Under the Biden administration, two big companies had proposed pioneering projects for cleaner steelmaking that were slated to receive $1 billion in federal support and would serve the growing market for lower-carbon metal. The industry seemed poised to begin a new chapter in the storied history of American iron and steel.
The manufacturer SSAB planned to produce iron — the key ingredient in steel — using green hydrogen in Mississippi. Then early last January, I saw the Swedish company had quietly withdrawn from award negotiations with the U.S. Department of Energy following the demise of its would-be hydrogen supplier, Hy Stor Energy. Soon after, President Donald Trump took office for a second time, moving swiftly to rescind grants and dismantle federal programs meant to advance clean energy and curb industrial emissions.
It wasn’t long before Cleveland-Cliffs, the other award recipient, shelved its own initiative for a hydrogen-ready ironmaking plant in Ohio. Today, the company is working with the Trump administration to develop a new scope for the project, one that preserves the use of fossil fuels. And SSAB recently told me that it’s not planning to revive any hydrogen-based projects in the United States.
Green hydrogen, which is made with renewable energy, has long been considered the Holy Grail for decarbonizing heavy industries because it can be used to replace fossil fuels in existing technologies and manufacturing methods. But now the U.S. green hydrogen boom itself has collapsed, taking the steel industry’s ambitions down with it.
At the dawn of 2026, America’s steel producers have no major green hydrogen initiatives slated to start this decade. Supplies of the low-carbon fuel remain scarce and expensive, and there’s no serious, coordinated attempt by the U.S. government to help resolve these stubborn barriers to cleaner steelmaking.
But while it may seem as if the industry has given up on decarbonizing U.S. steel production, the reality is much more nuanced.
Despite the high-profile retreats, manufacturers are still steadily making progress to clean up the country’s nearly 2-century-old industry. Legacy companies are investing in new steel-recycling mills, and startups are building facilities and raising private funding to scale novel technologies. Tech giants are boosting demand for cleaner construction materials as they work to limit the climate impact of the data center boom.
So what should we expect in the year ahead? There is no one clear path forward in the transition to greener steelmaking but rather many winding roads, with some heading toward progress and others looping back to the past. Here are three broad developments I’ll be keeping an eye on.
America’s modern steel era began in the late 19th century, fueled by scorching blast furnaces that use coke — a purified form of coal — to transform iron ore into molten iron, which is then turned into steel. This is still the main way that virgin, or “primary,” steel is made today, and it’s responsible for the bulk of the industry’s carbon emissions and toxic air pollution.
In recent decades, U.S. manufacturers have largely shifted to making “secondary” steel by recycling scrap metal in electric arc furnaces. But a dozen blast furnaces still operate in a handful of states, and their owners say they’re committed to keeping the facilities running well into the future.
U.S. Steel, which is now a subsidiary of Japan’s Nippon Steel, is set to “reline” its largest blast furnace in Gary, Indiana — a major maintenance project that could extend the aging furnace’s operating life by up to 20 years. In late December, U.S. Steel’s board of directors approved $350 million for the undertaking. The company also announced that it will restart operations at an idled blast furnace in southern Illinois to meet rising demand for domestic steel.
Cleveland-Cliffs, which relined one of its blast furnaces in Cleveland in 2022, plans to make similar upgrades at two other mills. The company will reline a blast furnace in Burns Harbor, Indiana, in 2027 and do the same in Middletown, Ohio — the site of its previous hydrogen project — “in the next four to five years,” according to CEO Lourenco Goncalves.
“Reality is back. La-la land is gone,” he said about the change of plans during an earnings call last May.
The manufacturers argue that propping up existing infrastructure is the better choice economically for maintaining and expanding their steelmaking capacity, versus building a new furnace or adopting other technologies. In the long run, however, those coal-fueled furnaces could become big liabilities as automakers, data center developers, and other key customers look to suppliers that offer less-carbon-intensive metal.
“The real challenge, from a technology perspective, is that there’s not really a path for a blast furnace to make the [low-carbon] products that are increasingly being demanded in the market,” said Kaitlyn Ramirez, a senior associate in RMI’s Climate-Aligned Industries Program. “There’s no solution that’s going to be cost-competitive to do that.” She added that the relining decisions represent a “window of opportunity” for steel producers to pivot away from coal instead.
Even as the two steel giants throw a lifeline to a few old dirty furnaces, they and other companies are still making investments to expand lower-carbon production of the ubiquitous, sturdy metal.
Nippon Steel, for its part, recently announced plans to build a $4 billion plant somewhere in the U.S. with two new electric arc furnaces, which typically combine a little bit of iron with a lot of scrap metal. These facilities can curb carbon emissions by 75%, compared to traditional steel mills, because they require using dramatically less coal, a figure that will grow as the nation’s grid increasingly runs on clean energy, according to industry reports.
Its subsidiary U.S. Steel already operates a sprawling steel-recycling operation in Osceola, Arkansas. I visited the Big River Steel site in late 2023, when U.S. Steel was building a second multibillion-dollar plant to make steel specifically for electric vehicle motors, solar panels, and power generators and transformers. Right next door was a field of flattened dirt where Entergy’s 250-megawatt solar farm was soon to be installed.
U.S. Steel finished the construction last year, and the company plans to buy enough clean electricity from the completed solar project to cover 40% of the second plant’s operations. Major steel recyclers like Nucor and Steel Dynamics have also struck deals with clean energy developers in other states to help reduce the emissions associated with running their power-hungry furnaces.
U.S. Steel is also set to construct a “direct reduced iron” facility at the Big River Steel site as it works to lead the industry in “advanced, sustainable steel production,” spokesperson Amanda Malkowski told the Arkansas news site Talk Business & Politics.
Neither Nippon Steel nor its subsidiary has given many specifics about the new ironmaking project. But most DRI facilities operating today use fossil gas to remove oxygen from iron ore, which yields lumps of iron that are fed into electric arc furnaces. This process emits about half as much CO2 as a coal-fired blast furnace. Using green hydrogen can curb overall emissions even further, by up to 90%, experts say.
Based on what’s happened in recent years, I’d be surprised if Nippon Steel plans to source green hydrogen for the project. But another major steelmaker claims to be committed to using the fuel down the road. Hyundai Motor Group says it plans to build a $6 billion steel plant in Louisiana by 2029 that will include a DRI facility and an electric arc furnace. The Korean automaker reportedly intends to start producing green hydrogen at the facility in 2034, though it hasn’t said much publicly about how it will manage such a feat.
Industrial giants aren’t the only ones working to clean up U.S. steelmaking. A handful of well-funded startups are steadily advancing newer ways of making the high-strength metal without using coal.
Last year, Boston Metal said it gotten one step closer to commercializing its “molten oxide electrolysis” technology after it fired up an industrial-size reactor at its facility in Massachusetts. Electra unveiled the site of its first demonstration plant in Colorado, where the company will produce iron with electrochemical devices powered by renewables. And in Texas, the startup Hertha Metals is turning iron ore directly into steel using a high-temperature, single-step process that currently runs on fossil gas but could switch to green hydrogen whenever supplies become commercially available, Hertha’s CEO Laureen Meroueh told me.
These novel efforts are drawing investment from not just global mining giants and metals manufacturers but also companies that use lots of steel — and see the material as a major source of their own supply chain emissions. Meta, for example, has agreed to buy certificates from Electra that will allow the tech company to count the emissions reductions associated with each ton of Electra’s clean iron toward Meta’s climate targets.
“Many of the long-term-focused large companies are looking at sustainability goals that last 10 to 20 years,” said Greg Matlock, the Americas metals and mining tax leader at accounting firm Ernst & Young. “Regardless of what the current political landscape is, I do think there’s absolutely still an appetite [for industrial decarbonization], and it’s a global appetite.”
The European Union is driving much of that global momentum. On Jan. 1, the 27-member bloc began implementing a carbon border tariff, which charges fees on imports of steel, aluminum, and other industrial products made in dirtier facilities abroad. The idea is to level the playing field for European manufacturers that invest in cleaner and potentially costlier facilities, while also encouraging other countries to regulate their own industrial CO2 emissions.
The carbon tariff won’t directly affect U.S. steelmakers all that much, given that they export only a tiny amount of metal to EU-member countries. But the policy’s ripple effects are already transforming the broader industry and putting pressure on all steel producers to modernize and clean up. Countries such as Brazil and Turkey have introduced domestic carbon-pricing policies in response to the EU’s moves. China has started shipping steel made using hydrogen to Italy, which experts say could set the stage for boosting Chinese green-steel exports.
“We’re moving toward a global standard … for lower-carbon steel, so American companies will be well positioned to compete in [global] markets if they continue to decarbonize,” said Angela Anderson, director of industrial innovation for the World Resources Institute. “It’s not likely that those trends are going to just dry up or reverse anytime soon.”
The U.S. has a chance to be at the cutting edge of cleaner steelmaking. Right now, the question seems to be not if we’ll take it, but when — and how far we’ll fall behind the rest of the world in the low-carbon industrial revolution.
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