NZ Steel’s $300m electric arc furnace gets green light

New Zealand Steel says it will soon start preparing its Glenbrook site for the installation of a new $300 million electric arc furnace, which it expects to have running by 2026.

The company, part of Australia’s BlueScope, said it had completed planning and internal approvals for the project.

NZ Steel said the furnace would reduce its greenhouse gas emissions by at least 45 per cent – the same as taking about 300,000 cars off the road permanently.

The Government has confirmed that it will co-fund the project to the tune of $140m, while NZ Steel will invest $160m.

Chief executive Robin Davies said the project would reduce Glenbrook’s carbon footprint by 800,000 tonnes per year.

“Steel is infinitely recyclable, and this model will make New Zealand as close to self-sufficient as possible using renewable energy via an innovative partnership with Contact Energy to recycle domestic scrap steel, rather than shipping it offshore,” he said.

Davies said NZ Steel would announce further partnerships as the project progresses, including the details of its scrap steel arrangements.

Delivery of the project remained subject to standard environmental regulatory approvals, he said.

Contact Energy has said power for the furnace would be supplied under a flexible, renewable energy agreement aimed at helping industry to decarbonise.

Last month, Meridian Energy said it had entered into a “demand flex” agreement with Open Country Dairy, similar to the one it has with NZAS – the country’s biggest power user.

Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.