One of the world’s largest mining houses has continued to throw its weight behind net zero by helping underwrite the development of a new processing technology, which could lead to the production of green steel.
In late 2025, Rio Tinto signed a joint development agreement with Australian outfit Calix Ltd to build a zero emissions demonstration plant in Western Australia with the aim of making lower carbon steel using Pilbara iron ore.
Known as Zesty™, the technology utilises a combination of electric heating and hydrogen reduction to provide low-cost pathways to green iron and steel through minimal hydrogen consumption, flexible electric heating compatible and the employment of intermittent renewable energy sources.
Ultimately, this should see the elimination of ore pelletisation as well as the use of fines and lower-grade feedstock.
So far, the Zesty™ pilot-scale trials ‒ in collaboration with the Heavy-Industry Low-Carbon Transitions Co-operative Research Centre and industry partners ‒ have proven the ability of this technology to produce green iron from a range of iron ore types and grades.
As it stands, the proposed demonstration plant is designed to produce up to 30,000 tonnes per annum of hydrogen-direct reduced iron (HDRI), or hot briquetted iron (HBI), from a range of feed sources.
Ultimately, the facility should provide an industry-wide platform for the non-exclusive toll processing of iron ores into HDRI or HBI to support the ongoing viability of Australian iron ore in a low emissions steel value chain. It should also be part of a new green iron industry in Australia.
The project has already garnered some industry interest, with the Australian Renewable Energy Agency agreeing to inject up to $44.9 million in the undertaking (subject to matched funding being secured).
If approved, the demonstration plant will be built at a site in Kwinana, 38 kilometres south of Perth, which was earmarked for Rio’s previously-announced BioIron™ research and development facility and its associated pilot plant.
The decision to reallocate these resources was made after the mining giant determined that the current furnace design for BioIron™ required additional development to minimise technical risks and optimise performance.
It is now expected Rio will invest more than $35 million, subject to project milestones and comprised of in-kind and financial contributions, to assist Calix.
“The world needs low emissions steel if it is going to decarbonise, and we continue to look at a range of ways Pilbara iron ores can help to do this as new technologies emerge,” the miner’s iron ore chief executive, Matthew Holcz, said.
“In parallel, we’ll keep progressing BioIron™ with our partners, the University of Nottingham and Metso, to further its potential. Both projects are part of our work to reduce emissions and support the future of iron ore in Australia and the communities that depend on it.”
This development has come at an interesting time for the power sector, with The Superpower Institute (TSI) recently pointing out that the future electricity trade will not be dominated by fossil fuels, but by raw materials which embody clean technologies.
Energy-intensive industries, TSI noted, would migrate to regions where cheap renewable energy exceeded domestic needs, with Australia being one of those “rare” jurisdictions.
As it stands, there are essentially three compelling reasons why the green iron industry should be developed Down Under.
First, green iron is an economic opportunity of historic scale.
“By leveraging its advantages in iron ore and renewables, Australia can move up the value chain from exporting raw commodities to higher value industrial materials,” TSI explained.
“The potential is enormous ‒ if green iron replaces iron ore as a primary export, it could generate up to $386 billion annually by 2060.
“By comparison, Australia’s iron ore exports are typically around $120 billion per year.”
Second, green iron offers a significant opportunity to contribute to global decarbonisation.
“Conventional steelmaking remains one of the largest industrial sources of carbon emissions world-wide,” TSI explained.
“An Australian green iron industry could abate emissions equal to roughly 4 per cent of the global total – more than three times Australia’s current domestic emissions.”
Third, green iron exports provide a hedge against the decline of fossil fuel exports.
“Coal and gas are two of Australia’s three largest export industries, currently generating around $120 billion in export revenue each year,” TSI noted.
“Yet most major economies have committed to achieving net zero between 2045 and 2070.
“The timeline and trajectory of global decarbonisation may be uncertain, but the direction is clear ‒ fossil fuel markets will contract in the coming decades.”
Nevertheless, TSI stressed, a green iron industry “cannot be built overnight”.
“If Australians want to capture the economic benefits of green iron, the Australian government needs to introduce policies that correct three market failures ‒ the absence of a global carbon price, the lack of early-mover support and underinvestment in common-user infrastructure,” the institute noted.
“These market failures constrain Australia’s green iron potential.”
Moreover, potential green iron producers were disadvantaged, TSI said, by the lack of an international carbon price.
In effect, this distorted the international market for iron products was creating an “inefficient advantage” for fossil fuel-based products.
Subject to a positive foreign investment decision and the successful completion of the project construction and commissioning milestones, Rio will have non-exclusive use of the Zesty™ demonstration plant once the operational phase of the undertaking starts.
“This strong support from Rio Tinto provides further validation of the potential for deployment of the Zesty™ technology to the world’s largest minerals and metals market, its potential to help decarbonise a critical industry responsible for around 8 per cent of global carbon dioxide emissions and the opportunity to help future-proof Australia’s largest source of export income,” Holcz added.
