Green steel expansion can set stage for energy market shift in Nordics
(Posted on 20/04/26)
The Nordics are set for a new phase of structural growth in electricity demand with expected realisation of green steel fabrication projects that can trigger a significant shift in the regional market landscape, according to the latest ‘Nordic Long-Term Market Outlook – 2050+’ from StormGeo.
Expansion of fossil-free steel production using green hydrogen generated by electrolysis has taken a big step forward with developer Stegra recently securing key financing for its proposed 700MW plant in Boden, northern Sweden.
“This brings the project a big step closer to maturity and can set the stage for other similar projects being developed. Together with rapid expansion of AI data centres in the region, this can significantly boost local electricity consumption,” says Sigbjørn Seland, Chief Analyst at StormGeo.
And this can change the market picture by stimulating demand and pricing to incentivise onshore wind investments in the northern zone that has rich potential for development but has earlier seen a collapse in prices due to oversupply
Improving wind project economics in the north can reduce the price gap with the southern zone where project development has been hit by permitting issues and local opposition, despite historically stronger market fundamentals and higher prices.
The business case for renewables development in the Nordics has been further strengthened by recent geopolitical instability that has raised fossil fuel supply risk, as well as prices.
Onshore wind is seen as the prime focus for expansion due to its low cost and scalability, while offshore wind needs subsidy support – with Denmark most proactive – and nuclear build-out is mainly seen in Sweden.
“Abundant renewable resources in the Nordics allow low-cost and low-carbon power generation to be secured at the domestic level, increasing regional security of supply,” Seland says.
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