Top 10 Green Hydrogen Steel Projects: thyssenkrupp’s 1.4 GW Deal and 12.5 Mtpa Capacity in Development (2025-2026)

The global green steel market is experiencing a significant geographical fracture, driven by divergent energy costs and policy support. While ambitious project announcements are surging in regions with low-cost renewable energy like Australia and the Middle East, European producers face a harsh economic reality, leading to widespread project cancellations and delays. Analysis of market activity in 2025 and 2026 reveals that high energy prices have crippled European ambitions, with Arcelor Mittal cancelling a €1.3 billion grant-supported project in Germany. In stark contrast, Oman is developing a massive 12.5 Mtpa of Direct Reduced Iron (DRI) capacity, positioning itself as a future export hub. The dominant theme is the strategic offshoring of the most energy-intensive part of the steel value chain, creating a “Green HBI Trade” model where Europe will increasingly import green iron to feed its mills and comply with regulations like the Carbon Border Adjustment Mechanism (CBAM).

1. PGS Green Iron Project

Company: Perpetual Global Solutions (PGS), thyssenkrupp nucera
Capacity: 2.5 million tonnes per annum (Mtpa) of green Hot Briquetted Iron (HBI) from 7 Mtpa of green iron pellets; supported by a 1.4 GW electrolyzer.
Application/Details: Giga-scale green hydrogen production to create green HBI for export. First exports are anticipated in 2029.
Source: PGS selects thyssenkrupp nucera as preferred supplier for 1.4 GW …

2. Jindal Steel Duqm HBI Plant

Company: Jindal Steel Group
Capacity: 2.5 Mtpa of Hot Briquetted Iron (HBI).
Application/Details: A second DRI plant at the Duqm facility, with technology supplied by Tenova and Danieli. It is one of three major projects contributing to Oman’s 12.5 Mtpa DRI capacity pipeline.
Source: Oman at the frontline of the green steel transition – IEEFA

3. Green Steel WA DRI Plant

Company: Green Steel WA
Capacity: 2.5 Mtpa Hydrogen DRI Plant.
Application/Details: The project, under consideration as of March 2025, aims to leverage Western Australia’s renewable energy resources for green iron and steel production.
Source: [PDF] Resources and Energy Quarterly, March 2025

4. Stegra Greenfield Plant

Company: Stegra (formerly H 2 Green Steel)
Capacity: Large-scale DRI-EAF facility supported by a 740 MW electrolyzer.
Application/Details: One of Europe’s flagship integrated green steel projects, aiming to start production in 2026. Despite construction progress, it faced a $1.1 billion pivot to maintain its timeline.
Source: Stegra’s $1.1 Billion Pivot: How Sweden’s Green Steel Pioneer

5. Hy Iron Namibia Expansion

Company: Hy Iron
Capacity: Aims for two million tonnes of DRI production annually by its third phase.
Application/Details: With a €2.3 billion investment for its third phase, the project shipped its first green DRI to Europe in February 2026 and is ramping up capacity with EU funding.
Source: Africa’s First Green Iron Production Begins in Weeks

6. Baosteel Zhanjiang Energiron DRI Plant

Company: Baosteel Zhanjiang Iron & Steel (Baowu Group)
Capacity: A new 220-tonne Electric Arc Furnace (EAF) designed for DRI, hot metal, and scrap.
Application/Details: This facility in China officially began DRI production in January 2026, representing a major step in Asia’s green steel transition.
Source: New Energiron® DRI plant starts production at Baowu – Danieli

7. Element Zero Pilbara Iron Super Hub

Company: Element Zero
Capacity: 2.7 Mtpa of green iron.
Application/Details: Another major Australian project under consideration as of March 2025, reinforcing the country’s strategy to become a dominant green iron exporter.
Source: [PDF] Resources and Energy Quarterly, March 2025

8. Whyalla Steelworks Transformation (Phase I)

Company: GFG Alliance
Capacity: 2.1 Mtpa of green sponge iron and 2.5 Mtpa of steel.
Application/Details: A key project in the South Australian government’s Green Iron and Steel Strategy, focused on integrating hydrogen-based DRI technology.
Source: [PDF] CEF_Transformation-and-Decarbonisation-of-Whyalla-Steelworks …

9. Unnamed US DRI Plant

Company: Unspecified
Capacity: 2.5 million tons per year DRI unit.
Application/Details: Announced in June 2025, this project includes two 120 MW Electric Arc Furnaces (EAFs) and is part of over 15 million tonnes of new EAF capacity planned in the US.
Source: How the US became a leader in green steel production – GMK Center

10. Arcelor Mittal India Renewable Energy Projects

Company: Arcelor Mittal
Capacity: 1 GW of nominal capacity (solar and wind).
Application/Details: Foundational investment to power future green steel ambitions. Arcelor Mittal Nippon Steel India received the country’s first Green Steel certification in February 2026.
Source: Green steel projects update: The momentum builds – EUROMETAL

Table: Top Green Steel DRI Projects (2025-2026)

€1.3 B Cancellation Signals Arcelor Mittal’s European Cost Pressures

The stark difference between ambitious plans and economic reality is defining industry adoption. In Europe, prohibitive energy costs are forcing major players to retreat. Arcelor Mittal’s decision to cancel a €1.3 billion DRI project in Germany, despite public subsidies, and Salzgitter’s delay of its flagship Salcos project underscore a critical trend: it is currently uneconomical to produce green steel at scale in the EU. The operating expenditure for green hydrogen-fed DRI/EAF steel was calculated at €1, 074/tonne at the end of 2024, nearly double the price of conventional steel. This economic headwind is shifting the adoption model away from vertically integrated European production and towards a reliance on imported green intermediates like HBI. This allows steelmakers to decarbonize the final stages of production without bearing the immense cost of domestic green hydrogen generation.

Green Steel Commands High Price Premium in Europe

This chart directly visualizes the “prohibitive energy costs” and economic pressures mentioned in the section by showing the significant and persistent price premium for green steel in Europe.

(Source: EUROMETAL)

Australia’s 5.2 Mtpa Green Iron Push Highlights a Regional Shift (2025-2026)

A clear geographical shift in green steel leadership is underway, with momentum moving away from traditional industrial centers in Europe. Australia is emerging as a powerhouse, with projects like the PGS Green Iron Project and Green Steel WA collectively representing over 5.2 Mtpa of planned green iron capacity. This is driven by the country’s unparalleled renewable energy potential and vast iron ore reserves. Similarly, Oman’s strategic development of 12.5 Mtpa of DRI capacity, led by companies like Jindal Steel, and Namibia’s export-focused Hy Iron project highlight a new axis of production in regions with favorable green energy economics. This global redistribution of production is a direct response to Europe’s high operating costs and signals that the future of decarbonized primary steelmaking lies in regions that can produce green hydrogen most affordably.

Green DRI Production, Stegra’s 740 MW Electrolyzer Shows Scaling

While DRI and EAF technologies are well-established, recent installations reveal that the primary bottleneck—the at-scale production of affordable green hydrogen—is now being addressed. The maturity of the market is demonstrated by the move from pilot projects to giga-scale industrial ecosystems. The PGS project’s selection of thyssenkrupp nucera for a massive 1.4 GW electrolyzer and Stegra’s 740 MW facility in Sweden are not just proof-of-concepts; they represent the commercial-scale infrastructure required for mass production. Conversely, the cancellation of Cleveland-Cliffs’ hydrogen project in the US due to “insufficient clean hydrogen supply” proves that project viability is now entirely dependent on securing a reliable, low-cost green hydrogen value chain. Technology maturity is no longer about the furnace, but about the fuel.

H2-DRI and EAF Set to Dominate Green Steel Production

This chart reinforces the section’s point about technology scaling by projecting that hydrogen-based DRI and EAF methods will become the dominant technologies for green steel production.

(Source: Stellar Market Research)

EU Green Steel Outlook, CBAM Drives HBI Imports Over Domestic Production

For the year ahead, European steelmakers will be forced to prioritize capital efficiency by accelerating long-term offtake agreements for green Hot Briquetted Iron (HBI) from producers in Australia, the Middle East, and Africa. This strategy allows them to meet the 2026 CBAM compliance deadlines by importing decarbonization rather than attempting to produce it domestically at a significant cost disadvantage.

• Losing Steam: Integrated green steel projects in high-cost EU regions are being widely deferred. Key signals include Arcelor Mittal’s cancellation of its €1.3 billion DRI investment in Germany and the general suspension of its DRI module construction across Europe, citing prohibitive gas and electricity costs.
• Gaining Traction: Export-oriented green iron hubs are rapidly advancing. This is evidenced by the development of 12.5 Mtpa of DRI capacity in Oman, alongside major projects in Australia (PGS, Green Steel WA, Element Zero) and Namibia (Hy Iron) designed specifically for the export market.
• Catalyst: The full implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM) in 2026 is the primary driver. While it creates a market for low-carbon steel, it also exposes the EU’s production cost gap, which is estimated to be around €100/tonne higher than in the US or Saudi Arabia. The current EU green premium of €120-€180/tonne is insufficient to close this gap, making green HBI imports the most logical and economic path forward for many EU players.

Green Steel Project Pipeline Faces Cancellations and Delays

This chart illustrates the section’s claim that EU projects are “losing steam” by showing a project pipeline with a mix of outcomes, including a notable portion of cancelled projects around the mid-decade.

(Source: Leadership Group for Industry Transition)

The questions your competitors are already asking

This report covers one angle of the strategic divergence in global green steel project development. The questions that matter most depend on your work.

• Which steel producers are gaining or losing ground in the race to secure low-cost green iron?
• What is the outlook for European green steel deployment following the cancellation of ArcelorMittal’s grant-supported project in Germany?
• What are the opportunities for equipment suppliers and traders in the emerging “Green HBI Trade” between Europe and production hubs like Oman and Australia?

This report does not answer these. Enki Brief Pro does.

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