What is the Green Steel Project?
With the Green Steel Project, Tata Steel Nederland aims to gradually change the way steel is produced in IJmuiden. The goal is to reduce direct CO₂ emissions, lessen the impact on the surrounding environment, and increase the use of scrap.
Implementation will take place in phases and depends on factors such as permits, investment decisions, financing, energy infrastructure, and the availability of energy and raw materials.
The expected effects of the project are being assessed in the environmental impact report and will be taken into account in the permitting process and decision‑making.
Why we are changing
Current steel production relies heavily on coal and results in CO₂ emissions. Steelmaking also affects the surrounding environment, for example through emissions to air and water, noise, and odour.
We believe that steel should continue to be produced in the Netherlands in the future. That is why we want to invest in a new production route that better aligns with future requirements in the areas of climate, environment, and circularity. Ultimately, our goal is to achieve net‑zero Scope 1 and 2 greenhouse gas emissions by 2045. More about our 2045-ambition. **
What will change in Phase 1?
In the first phase, Tata Steel Nederland intends to replace Blast Furnace 7 and Coke & Gas Plant 2 with a DRI plant and an electric arc furnace****. Adjustments to buildings, roads, rail connections, logistics, and energy facilities on the site will also be required.
Not everything will change immediately. Part of the existing production route will remain in use during this phase. Phase 1 therefore does not mean that Tata Steel Nederland will immediately stop using coal, natural gas, or other fossil fuels altogether. Additional steps will be needed after Phase 1.
What do we aim to achieve?
The Green Steel Project is designed to enable improvements in several areas.
Lower CO₂ emissions
A large share of the current direct CO₂ emissions from steel production comes from the use of coal in the blast furnaces. In the first phase of the Green Steel Project, Tata Steel Nederland plans to replace Blast Furnace 7 and Coke & Gas Plant 2 with, among other things, a DRI installation and an electric arc furnace. After that, far less coal will be needed for this part of production.
According to an independent technical report for the government, direct CO₂ emissions can decrease by around 5.4 million tonnes per year. This represents a reduction of more than 40% compared with the representative baseline used in the report.
* More information on the calculations and supporting evidence.
Less impact on the environment
In addition to reducing direct CO₂ emissions, the Green Steel Project is intended to lessen the impact of operations on the surrounding environment. Since 2019, we have already implemented more than 30 improvement measures. With the Green Steel Project, we build on efforts to reduce emissions and dust dispersion, including through new installations and further covering of raw materials. The effects of these measures are being assessed in the environmental impact report (MER) and will be considered in permitting procedures and decision‑making.
More use of scrap
The new production route makes it possible to use more scrap in steelmaking. This allows valuable raw materials to remain in the cycle longer and reduces the need for new materials. Our ambition is to increase the share of scrap in steel production from 17% to around 30% starting in Phase 1. Greater use of scrap contributes to more efficient use of resources and supports further decarbonisation of steel production.
From coal to a new production route
In the first phase, Tata Steel Netherlands aims to shift part of steel production from coal to electricity and natural gas. Over time, natural gas can be replaced by biomethane and/or hydrogen, enabling further reductions in CO₂ emissions.
Whether and when this transition will take place depends on factors such as the availability and affordability of these energy carriers, the required infrastructure, technological developments, permits, and investment decisions. Tata Steel therefore works with different scenarios and closely monitors developments.
***More information on natural gas, biomethane and hydrogen
What is already certain, and what is not?
The Green Steel Project is being developed and implemented step by step. Various parts of the project still depend on permitting, decision‑making, investment decisions, financing, energy and transport infrastructure, the availability of energy and raw materials, the technical design of installations, and the outcomes of studies and procedures.
As a result, timelines, expectations, and project components may change in the future. On this page, we indicate what is already confirmed and which elements are still under preparation or investigation. New information will be added as it becomes available.
Frequently asked questions about the Green Steel Project
The Green Steel Project is a multi‑year transition to a new way of producing steel. We regularly receive questions about topics such as expected CO₂ reduction, technical feasibility, financing, and the role of biomethane and hydrogen. Below we answer several of these questions and refer to the studies and reports on which our plans and calculations are based.
* What is the expected 40% CO2 redution based on?
A large share of current CO₂ emissions from steel production arises from the use of coal in the blast furnaces. Blast Furnace 7 accounts for roughly 60% of today’s coal‑based steel production. That is why Tata Steel Nederland intends to replace this blast furnace with a DRI installation (Direct Reduced Iron) and an electric arc furnace as part of the Green Steel Project — a production route that uses far less coal. This enables a substantial reduction in CO₂ emissions from steelmaking.
The expected reduction of more than 40% is based on calculations reviewed by the independent engineering firm Mott MacDonald. In a technical report for the Dutch government, the firm concludes that direct CO₂ emissions from steel production can decrease from 12.6 million tonnes per year to 7.2 million tonnes per year after completion of the first phase of the Green Steel Project. This corresponds to a reduction of more than 40%. The comparison is based on a baseline derived from Tata Steel Nederland’s 2018 production and emissions.
Mott MacDonald concludes that the calculations were made using standard methods within the steel industry. They assessed raw materials, energy flows, and production processes for both current and future steelmaking routes. The calculations are based on assumptions about project execution and future operations. Actual results will depend on factors such as permitting, investment decisions, planning, energy infrastructure, and project implementation.
** How does Tata Steel Nederland plan to further reduce CO₂ emissions towards 2045?
Tata Steel Nederland aims to achieve net‑zero Scope 1 and 2 greenhouse gas emissions by 2045. The most significant step is replacing the current blast furnaces, where coal is used to produce iron. This process and its associated production chain currently account for a large share of steelmaking emissions.
With the first phase of the Green Steel Project, Tata Steel Nederland aims to reduce CO₂ emissions by more than 40% (see above). After that, the intention is to replace the second blast furnace with a new production route that does not use coal.
Emissions can then be further reduced by gradually operating the new installations with more sustainable energy carriers, such as biomethane and potentially hydrogen. Tata Steel Nederland is also exploring whether part of the remaining CO₂ emissions can be captured and stored. Additional measures are being developed as well, including further electrification, energy efficiency, and reducing emissions from other production processes.
This development is part of a broader global trend. Steel companies worldwide are investing in new production routes in which coal is gradually replaced by electricity, hydrogen, and other alternative energy carriers.
The ambition for 2045 extends beyond the first phase of the Green Steel Project. The main direction is clear: replacing the blast furnaces, further reducing emissions from the new production route, and increasing the use of more sustainable energy carriers. However, not all subsequent steps have been fully defined yet. Further development depends on technological progress, permitting, investment decisions, financing, energy infrastructure, and the availability of sustainable energy and raw materials. Tata Steel Nederland will continue to refine this pathway in the coming years and update information as plans and decisions become more concrete.
*** Is the use of biomethane and hydrogen realistic?
A key element of the Green Steel Project is that Tata Steel Nederland aims to shift from coal to electricity and natural gas to reduce emissions. Over time, natural gas can be replaced by biomethane and/or hydrogen. Whether and when this happens depends on factors such as availability, affordability, and the required infrastructure.
The new DRI installation is therefore being designed to operate on natural gas, biomethane, and hydrogen. This allows the share of sustainable energy carriers to increase step by step in the future, enabling further CO₂ reductions.
At the request of the Ministry of Climate and Green Growth, an assessment was carried out to determine whether sufficient biomethane could become available for Tata Steel Nederland. According to an independent report by Common Futures, the European biomethane market is growing rapidly and has sufficient potential to meet future demand. The report of the Advisory Committee on Tailored Agreements for Industrial Decarbonisation (AMVI) also concludes that the expected biomethane supply in Europe could be sufficient for Tata Steel Nederland's intended use.
For hydrogen, availability and affordability remain uncertain at this stage. That is why hydrogen is not a starting point for the early years of the Green Steel Project. However, the installation is being designed so that it can operate on hydrogen in the future, once sufficient sustainable hydrogen is available and the necessary infrastructure is in place.
**** Have these technologies been used in the steel industry before?
Yes. DRI installations (Direct Reduced Iron) and electric arc furnaces are used worldwide for steel production. According to the European Commission and Eurofer, these technologies are among the most important routes for reducing CO₂ emissions in the steel industry.
Many steel producers in Europe and beyond are investing in DRI‑based and electric‑arc‑furnace production routes as alternatives to traditional blast furnaces. The Green Steel Project therefore aligns with a broader international development in the steel sector.
In an independent technical advisory report for the Dutch government, engineering firm Mott MacDonald concludes that the chosen DRI‑EAF route is consistent with established industrial practice. At the same time, the report notes that further development of the project depends on various technical, economic, and infrastructure‑related conditions.
The new DRI installation will start up using natural gas but is designed to operate on biomethane and hydrogen as well. When the transition to more sustainable energy carriers will take place depends on factors such as availability, affordability, and infrastructure.
***** How will the transition to Green Steel be financed?
Implementing the Green Steel Project requires an investment of approximately €4 to €6.5 billion. Based on current insights, this investment will come from several sources, including Tata Steel Nederland, Tata Steel Limited, external financiers, and — under certain conditions — the Dutch government.
In the Joint Letter of Intent (JLoI) signed in 2025, Tata Steel Nederland, Tata Steel Limited, and the Dutch government set out high‑level agreements for further development of the project. It states that the Dutch government may contribute up to €2 billion to the decarbonisation of steel production in IJmuiden, subject to conditions.
Tata Steel Nederland and Tata Steel Limited have indicated that they intend to finance a significant portion of the investment themselves. Additional financing options are being explored through external parties such as banks and other financiers. The final financing structure will depend on factors including total project costs, market developments, investment decisions, and agreements still to be finalised.
Any potential government contribution is not intended to cover cost overruns. Conditions apply to such a contribution, including requirements related to decarbonisation, environmental performance, and project progress. Discussions on these matters are ongoing within the framework of the Tailored Agreements.
What does the execution of the Green Steel Project depend on?
The Green Steel Project is a major, multi‑year transformation. Its execution depends on several conditions. These include permits, final investment decisions, appropriate financing, and sufficient energy infrastructure. Sustainable energy and raw materials — such as electricity, biomethane, and potentially hydrogen — must also be sufficiently available and affordable. In addition, technical design, planning, and construction execution play important roles.
Tata Steel Nederland is working on these topics together with the government and other stakeholders. Not all decisions have been made yet. As soon as more clarity becomes available, we will update information on planning and implementation.
Want to know more?
Read more about:
- Joint Letter of Intent (JLoI);
- Advice from the Advisory Committee on Tailored Agreements for Industrial Decarbonisation (AMVI);
- Energy and biomethane scenarios from the Common Futures report;
- Technical assessment by Mott MacDonald;
- European Commission research on the transition of the European steel industry to climate neutrality
- Eurofer projects for low‑CO₂ steel production in Europe
