Swedish specialty steel manufacturer SSAB has announced that the conversion of its Oxelesund plant to fossil fuel-free steel production will be delayed due to appeals related to environmental regulations affecting the permitting process for the construction of a new power transmission line. The delay affects the electrical connection required for the company's new electric arc furnace (EDP).
According to the company, Vattenfall Eldistribution has informed SSAB that the timing of the required connection to the power grid has been postponed. The new energy infrastructure is considered critical for the operation of the planned steel plant without the use of fossil fuels.
The construction of the electric arc furnace continues according to the plan.
Despite the delay in issuing permits, SSAB stated that the construction of the electric arc furnace itself continues according to schedule and within budget. Previously, the company planned to start production on the new EDP at the beginning of this year, 2027.
Johnny Shestrem, President and Chief Executive Officer of SSAB, criticized the impact of Swedish permitting and grid approval procedures on industrial investment projects. He stated that the uncertainty surrounding the procedures for issuing permits and approving electricity infrastructure poses a significant risk to future investments in electrification and industrial modernization in Sweden.
Shostrem also stressed that the European Union considers the steel industry as a strategic sector, especially against the background of growing demands for civilian and military readiness throughout Europe.
The company said it would provide additional updates as soon as the full extent of the delay becomes clear.
No significant impact on the results of operations in 2026 is expected.
According to SSAB, the postponement will not have a significant impact on the company's profit or cash flow during 2026. The company also noted that current production operations and customer deliveries will remain unchanged.
SSAB stated that after the Oxelesund conversion is fully completed, the project is expected to reduce total carbon dioxide emissions in Sweden by about three percent.
Author: Stilorbis
Steelorbis.com
