Ontario Invests in Clean Steelmaking Technology To Support Auto Sector

ArcelorMittal Dofasco Hamilton will be the first integrated steel mill in North America to transition off coal, and among the first in the world.

ArcelorMittal Dofasco and the Ontario government are joining forces on an investment to transform the province into a world-leading producer of green steel that will boost the province’s auto parts supply chain and skilled workforce in communities with deep roots in steel manufacturing. The partnership will help meet the global demand for low-carbon auto production.

The approximately $1.4 billion project by ArcelorMittal Dofasco will make the company’s Hamilton facility among the first of its global operations to replace coal-fed coke ovens and blast furnaces with new, low-emission technology. The move to a hydrogen-ready direct reduced iron fed electric arc furnace (EAF) will take advantage of Ontario’s clean electricity supply to eliminate the use of coal and coke from ArcelorMittal Dofasco’s steelmaking process, one of the largest sources of greenhouse gas emissions in the province.

ArcelorMittal Dofasco Hamilton
(Source: ArcelorMittal Dofasco)

Ontario is contributing up to $394 million in loan and grant support to the project, which will reduce carbon dioxide (CO2) emissions by about three million tonnes annually. The CO2 reduction is equivalent to taking almost one million cars off the road. The shift to “green steel” technology is critical as large automakers and other major manufacturers work to reduce emissions along their supply chains.

Phase 2 of Driving Prosperity ― The Future of Ontario’s Automotive Sector, demonstrated the government’s commitment to transform the province’s automotive supply chain to build the cars of the future. That commitment includes supporting the shift to low-carbon steel production that will give Ontario a competitive advantage in attracting investments; creating and retaining skilled, local jobs for Ontario workers; and helping the province meet its greenhouse gas emissions target by 2030.

“Not only is this investment great news for the people of Hamilton, this is great news for people across the province as we take another step towards making Ontario a global innovation hub for building the car of the future,” said Premier Doug Ford. “By investing in innovative technologies, we’re strengthening our economy and protecting good local jobs for Ontario workers.”

“Reducing ArcelorMittal’s CO2 emissions intensity worldwide by 25% by 2030 is an ambitious target for a steel and mining company; but we believe it is achievable and that it is our responsibility to invent or innovate the processes and technologies that will enable us to reach that goal,” said John Brett, CEO North America, ArcelorMittal. “As part of that, we understand that in the coming years, the assets used to make steel will undergo a transformation on a scale not seen for many decades.”

“This investment puts us on a path to low-carbon, sustainable steel and is possible only through partnership with government,” said Ron Bedard President and CEO, ArcelorMittal Dofasco. “All options for the newest, most advanced technology that achieves maximum carbon reduction for steelmaking, enhanced product capability and quality, and advanced manufacturing employment opportunities were explored. Extensive benchmarking and modelling were also completed in preparing the ultimate plan for the sustainability of the environment, the company, employees, customers, and the community.”

“From day one, our government’s plan has been to unleash Ontario’s economic potential and attract investment by making the province an attractive place to do business once again – and by lowering taxes, reducing electricity costs and red tape, we have reduced the cost of doing business in Ontario by nearly $7 billion a year,” said Vic Fedeli, Minister of Economic Development, Job Creation and Trade. “This exciting investment in innovative green-steel manufacturing with ArcelorMittal Dofasco will give automakers and other industries yet another reason to buy Ontario and hire Ontario workers when they look to transform their supply chain.”

Ontario is home to one of the cleanest electricity grids in the world, with more than 90 per cent of its electricity generation producing zero emissions. The government has made significant investments to reduce electricity prices for industrial customers, including through the Comprehensive Electricity Plan which has reduced costs by about 15 percent. This investment in clean steel making will take advantage of that clean, affordable electricity supply giving ArcelorMittal Dofasco a competitive advantage as businesses look to reduce emissions in their supply chain.

“As companies like ArcelorMittal Dofasco make significant investments to electrify and reduce emissions, they do so knowing they can rely on Ontario’s clean and affordable electricity system giving them a competitive advantage,” said Todd Smith, Minister of Energy. “Our government is proud to support this expansion of clean steelmaking that will support local jobs in Hamilton. We will continue to build on our significant investments that have reversed the trend of skyrocketing electricity prices as we continue to make Ontario an even better place to do business.”

In cooperation with the federal government, Ontario’s domestic steel industry and its customers, including major automotive, mining, energy, and construction companies, are working together to reduce the environmental impact of their operations and products. This investment will significantly reduce the province’s greenhouse gas emissions (helping move the province toward its 2030 target) and accelerate the province’s pivot to carbon-neutral manufacturing. Ontario’s investment will match the Government of Canada’s investment in the project, announced in July 2021. The goal is to have the project completed by 2028.

“ArcelorMittal Dofasco Hamilton will be the first integrated steel mill in North America to transition off coal, and among the first in the world. This is a massive achievement for the province and for Canada; and will solidify Ontario as a global leader in the transition to low-carbon manufacturing, including of electric vehicles,” said David Piccini, Minister of Environment, Conservation and Parks. “This is great news for Ontario workers and their families today and for our children and grandchildren who will benefit from a cleaner environment for many generations to come.”

“ArcelorMittal Dofasco has produced steel in Hamilton for more than a century and is the city’s largest private-sector employer,” said Donna Skelly, MPP for Flamborough-Glanbrook. “Our government is demonstrating its commitment to clean steelmaking technology and a thriving auto sector by investing in a company that has been recognized for its work on reducing greenhouse gases and minimizing its impact on the environment.”