Justin Trudeau, prime minister of Canada, has announced that Canada-based Algoma Steel will receive up to $420 million to strengthen its operations and phase out steelmaking processes with coal at the company’s plant in Sault Ste. Marie, Ontario.
The funding will enable Algoma Steel to purchase state-of-the-art equipment to support its transition to electric arc furnace production. This electricity-based process is expected to cut greenhouse gas emissions by more than three million mt per year by 2030, contributing to achieving Canada’s climate goals.
According to the statement, the investment will create 500 jobs through the project’s construction and subcontracting.
“The 70 percent carbon reduction resulting from Algoma’s proposed transformation to electric arc furnace technology represents one of the lowest cost-per-tonne opportunities to achieve large-scale sustainable GHG reductions in Canada. The combination of an electric arc furnace with Ontario’s low carbon electricity will give our customers and infrastructure investments a green steel advantage,” Michael McQuade, CEO at Algoma Steel, said.
Meanwhile, as part of this investment of up to $420 million, Algoma Steel will receive up to $200 million from the Strategic Innovation Fund’s Net Zero Accelerator initiative and $220 million from the Canada Infrastructure Bank. The total cost of Algoma’s project is $703 million.