Clean Steel Plant Investment Secures EUR 150 Million Commitment

A major clean steel plant investment is advancing in Spain after Hydnum Steel secured a EUR 150 million commitment from the Co-investment Fund (FOCO), managed by COFIDES, on August 5. The funding will support development of the company’s industrial complex in Puertollano, Ciudad Real, planned as the Iberian Peninsula’s first clean steel plant. The project is expected to move into earthworks and construction by the end of 2026, marking a significant step toward establishing large-scale low-carbon steel production in the region.

The financing forms part of a broader plan expected to mobilise more than EUR 1.5 billion in total investment. The project has also secured agreements covering 100% of the production capacity demand planned for its first phase during the initial five years of operation. These commitments provide the development with substantial commercial visibility as construction preparations progress. The investment structure is intended to support the establishment of an industrial-scale facility while advancing a production model designed around lower-carbon steel manufacturing and long-term operational demand.

The digitally integrated facility will eliminate fossil fuels from its production process, instead relying on electric arc furnaces powered by green hydrogen and 100% renewable energy. This approach is designed to reduce Scope 1 and 2 CO₂ emissions by up to 98% compared with traditional blast furnace methods. The project also has a significant employment dimension, with more than 5,000 total jobs expected to be generated across its various phases. The development therefore combines industrial investment, renewable-energy integration and employment creation within Spain’s emerging clean steel ecosystem.

Frequently Asked Questions

What is the EUR 150 million investment intended to support?
The funding is intended to support construction of a new clean steel industrial complex in Puertollano, Ciudad Real, designed to become the Iberian Peninsula’s first clean steel plant. The investment commitment comes from the Co-investment Fund (FOCO), managed by COFIDES, and forms part of a broader financial plan expected to mobilise more than EUR 1.5 billion. Construction and earthworks are planned to begin by the end of 2026, supporting the project’s transition from development toward industrial implementation.

How will the plant reduce steelmaking emissions?
The facility will replace fossil-fuel-based production with electric arc furnaces powered by green hydrogen and 100% renewable energy, supporting substantially lower operational emissions. According to the project description, this production model is expected to reduce Scope 1 and 2 CO₂ emissions by up to 98% compared with traditional blast furnace methods. The digitally integrated design is intended to combine renewable energy with alternative steelmaking processes while supporting the development of a large-scale clean steel production facility in Spain.