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Globally traded commodities such as iron and steel are coming under international scrutiny owing to their significant embedded greenhouse emissions. Commodity export-oriented nations must explore opportunities for decarbonising these supply chains or risk losing market share as customers seek cleaner alternatives and as initiatives such as carbon border adjustment mechanisms (CBAM) come into effect. Here we present an open-source model developed to assist industry and other stakeholders in assessing the costs of potential CO 2 abatement pathways in supplying green iron ore, green iron, or green steel to key global markets. Using a case study, we assess the development of a green steel supply chain from major iron ore producers of Australia, Brazil, and Sweden, to key markets in Europe, China, and India. Projected costs of renewable energy and other key technologies are used to estimate possible future costs of different decarbonisation pathways. Our modelling suggests that by 2050, export costs of green iron ore, iron and steel could range from 48 to 150, 370–600 and 540–810 USD/tonne respectively. Access to low-cost renewable energy is the key driver of cost reductions for value added products such as iron and steel, and given their substantial renewable energy potential, in 2050 Australia and Brazil could outcompete Sweden in providing these products, with both even outcompeting Sweden in exporting to the European market. The release of our model as open source allows any and all stakeholders to explore the implications of key technology and market uncertainties over least cost green iron and steel supply chains. • Energy costs are the main driver of green iron and steel production costs. • Australia and Brazil have lower cost of iron and steel production than Sweden. • Green iron and steel costs could range from 370 to 600 and 540–810 USD/t in 2050. • Sweden and Brazil can decarbonise their steel industry via current grid electricity.
Ellersdorfer et al. (Fri,) studied this question.