29 June 2023
Commission approves €280 million state aid to support ArcelorMittal Belgium to decarbonise its steel production
The European Commission has approved, under EU State aid rules, a €280 million Belgian measure to support ArcelorMittal Belgium (‘ArcelorMittal') in partially decarbonising its steel production processes. Belgium notified to the Commission a €280 million measure to support ArcelorMittal's project aimed to partially decarbonise its steel production in Ghent, where it operates two blast furnaces producing liquid hot metal from a mixture of iron ore, coke and limestone.
The aid, which will take the form of a direct grant and a soft loan, will support the construction of a direct reduction iron plant. Together with a new electric arc furnace, the plant will substitute one of the two existing blast furnaces. Natural gas, initially used in the energy mix, will be gradually phased out of the steel production processes. Ultimately, the plant will be operated using renewable hydrogen and only complemented by low-carbon hydrogen if there is not sufficient renewable hydrogen available.
The plant is envisioned to start operating in 2026 and it is expected to produce 2.3 million tonnes of low-carbon direct reduced iron per year. Once completed, the project is expected to avoid the release of above 50 million tonnes of carbon dioxide. ArcelorMittal has committed to disseminate the technical know-how gained through the project.