The European Investment Bank (EIB) has granted a €350 million loan to the Italian Danieli Group, a global leader in steel plant production, a portion of which will be allocated to its plants in Croatia.

The loan will help to promote the circular economy through the production of recycled steel at Acciaierie Bertoli Safau in Cargnacco, Udine, Italy and Acciaierie Bertoli Safau in Sisak, Croatia, the EIB and Danieli said in a joint press release.

They said that 65% of the loan (€227.5 million) will be allocated to Danieli’s Italian plants in Udine province, while the remaining 35% (€122.5 million) will go to the plants in Sisak.

This is the fifth operation signed by the EIB and Danieli in the last 25 years, totalling €580 million.

The EIB financing will help Danieli Group achieve climate neutrality by 2050, contributing to the development of innovative technologies for producing steel using electric arc furnaces and mini-mills. The project also aims to foster the transition to a circular economy by reusing by-products and increasing the recovery of other metals from scrap.

The EIB resources will go towards the design and creation of green plants with three major positive effects: 1. Reducing specific energy use via plant efficiency, making it possible to cut CO2 emissions per tonne of steel produced; 2. Driving the circular economy via the recycling of scrap to produce steel, promoting the responsible management of this type of material and limiting greenhouse gas emissions. The local reuse of scrap prevents it from being exported from Europe to other countries across the world, only for new material to be extracted. 3. Creating new, stable jobs, as well as improving STEM (science, technology, engineering and mathematics) skills.

In addition, EIB estimates indicate that the development of innovative and advanced manufacturing technologies, and the reuse of by-products and other metals will help Danieli to reduce its environmental impact considerably and create new jobs in both Italy and Croatia. The EU bank estimates that 250 jobs will be created during the implementation of the project.

“The steel industry alone is responsible for 10 percent of global CO2 emissions. This operation shows the commitment of the EIB (as the EU climate bank) and Danieli to developing more sustainable and innovative alternatives like recycled steel production, helping to reduce environmental impact and safeguard jobs in both Italy and Croatia,” said EIB Vice-President Gelsomina Vigliotti.

“Ongoing investment in green, innovative technology to help combat climate change is a top priority for Danieli. This commitment was recently recognised by the Carbon Disclosure Project non-governmental organisation, which confirmed our status as a climate change leader in plant equipment for the second year running,” said Camilla Benedetti, Chairwoman of Acciaierie Bertoli Safau S.p.A. and Vice Chairwoman of Danieli & C. S.p.A.

“In this transition plan, the EIB is an important ally and stakeholder in the pursuit of the European Green Deal as it acts as a driving force towards climate neutrality, making it a key institution on the path to growth and sustainability,” she added.