The giant green steel factory would create up to 5,000 jobs – Schedule postponed again

To Inkoo The gigantic green steel factory planned for western Uusimaa would create a total of 5,600 person-years of work in Finland and bring tax revenues of approximately 300 million euros to the state coffers per year.

This was announced by the Norwegian Blastr Green Steel company running the project at its event in Inkoo on Tuesday. Calculations on the economic effects of the factory project were made by the consulting company Ramboll.

The calculation of 5,600 person-years is based on the multiplier effects generated by the production plant in the economy, such as subcontractors and services.

According to current plans, the factory would bring a little less than a thousand direct jobs. The number has decreased somewhat from what was initially announced.

The factory, if realized, would be one of Finland’s largest industrial investments ever. Its price tag is four billion euros.

Inkoo factory would produce about 2.5 million tons of steel with low carbon dioxide emissions per year. It is on the same scale as the production of Finland’s largest steel factory, SSAB’s Raahen factory.

The electricity consumption of Inkoo’s green steel factory would be a whopping 7–10 terawatt hours per year. The figure corresponds to almost ten percent of Finland’s current electricity consumption.

Steel would be produced using a technology where iron is reduced with hydrogen instead of burning coal. Melting would take place in an electric arc furnace.

The raw materials would be iron pellets imported from abroad and recycled steel.

When electricity is produced cleanly, the method is quite climate-friendly.

In traditional steel production based on burning coal, more than two tons of carbon dioxide can be produced per one ton of steel. Blastr calculates that a ton of steel emits around 300 kilograms of carbon dioxide.

Present in the Inko cafe there was also Blastr Green Steel’s country manager for Finland, who jumped into green steel from a long career at Fortum Antti Kaikkonen.

Kaikkonen told media representatives that he owns a summer cottage very close to the planned plot of the green steel factory. Some of the locals have been worried about the noise emissions of the large factory and the effects on the air quality and the sea in the surrounding area.

Kaikkonen reminded that there is a lot of industrial history in the area, even if the locals don’t necessarily think of Inkoo’s identity as such.

Blastr’s steel plant would be built on the site of the former Fortum coal power plant. The power plant, which ceased operations in 2014 and was dismantled in 2020, was the largest coal-fired power plant in the Nordics when it was operating.

According to Kaikkonen, the place is ideal in many ways. The deep harbor and strong electricity transmission connections are ready. In addition, Finland’s electricity production is already very clean compared to European standards, and new wind and solar electricity projects are underway.

“If these green transition investments cannot be started in such places, then this will become really difficult,” Kaikkonen stated.

Kaikkonen there was also news hidden in the presentation: the target schedule has been postponed again.

“The goal is for the factory to be in full production by the end of the decade,” Kaikkonen said.

When Blastr announced its project in January 2023, the intention was to start production already in 2026. When HS reported on the start of the environmental impact assessment in August 2023, the company clarified that the target year for starting production is 2027.

So now we are talking about the end of the decade.

Ramboll’s consultant Samuel Rintamäki in the films, the economic effects of the construction period had been calculated for the period 2024–2028.

One of the reasons for the postponement is probably the encounter with realism in the permit process. For example, the construction of a port area requires surveys of the bottom vegetation, which can only be done in the summer.

A bigger question in the environmental impact assessment is where to put the heat generated by the factory. A lot of it is produced, and if discharged directly into the sea, it would accelerate eutrophication.

Now, based on the feedback it received, Blastr had already slightly changed its environmental impact assessment program so that it also includes an option in which all surplus heat is evaporated away from the evaporation towers. The utilization of waste heat is also being sought.

“Many things still need to be answered before we actually start building,” Kaikkonen said.

Blastr has a financing round for the factory underway. According to Kaikkonen, the increased interest rates will not change the factory’s profitability calculation significantly.

According to him, the EU’s tightening regulation plays the most important part in the competitive advantage of the Inkoo project. The EU will start setting an increasingly higher price for steel production emissions starting in 2026, which favors green production.

According to Kaikkonen, there are several similar projects under development in different parts of the world. However, not a single steel plant based on hydrogen reduction on such a large scale is in operation. Kaikkonen does not consider it a problem, because the functionality of the technology is known on a smaller scale and the devices can be obtained “off the shelf”.

“Now it just needs to be implemented on an industrial scale.”