Magsort

Steel and concrete production are significant sources of emissions from human activity. The steel industry is already taking many major steps to reduce its emissions, including replacing coal with hydrogen in steel manufacturing. Emissions reduction measures in the steel industry also include material efficiency through circular economy: when valuable raw materials are recovered from steel industry side streams, the already improved emissions reduction potential in production processes will be further enhanced.

With Magsort’s solution, almost all metal can be recovered from the waste slag – and in the future the remaining slag could even be ground into cement.

Climate Fund financing decisions are guided by a three-tiered set of criteria. The threshold conditions for financing are at least a credible path to self-sustaining business, verifiable added value for the state’s participation in the total investment and compliance with the six environmental objectives of EU sustainable financing, the so-called do no significant harm principle. In addition to the threshold conditions, emissions reduction potential and other effects, such as business potential, are sought.

Estimates indicate that the solution has a significant appr. 4.8 Mt CO2-eq cumulative emissions reduction potential in the steel industry in the 2020s. Funding from the Climate Fund has initially been assessed based on the business and emissions reduction potential in the steel industry. However, in the longer term, the use of the solution in cement manufacturing could lead to additional emissions reduction of up to millions of tonnes of CO2-eq. The solution also has significant export potential.

The €4.5 million funding from the Climate Fund is aimed at strengthening the working capital i.e. financing equipment investments. The Climate Fund loan is drawn down one unit at a time against the validation of target-specific emissions reduction potential.

The interest on the Climate Fund’s capital loan has been priced in accordance with the reference interest rate table published by the EU, i.e. the Climate Fund is entitled to interest on its capital loan on market terms. In addition, the Climate Fund receives an additional interest rate tied to the profitability of the projects.

The Climate Fund has revised its impact assessment by reviewing the ten-year emissions reduction potential of the 2021 investment targets for the first time.