Rio Tinto has taken another step in reshaping its decarbonisation strategy with a new agreement to fund the development of a green iron demonstration plant alongside Australian environmental technology firm Calix. The mining group has pledged more than twenty three million dollars to support construction of the facility, which aims to prove out a low emission ironmaking process powered by electric heating and hydrogen. At the same time, Rio Tinto confirmed that it will pause its higher profile BioIron initiative, raising important questions about the shifting technologies that could eventually define the future of climate aligned steel production.

A Strategic Shift Toward Electric and Hydrogen Based Ironmaking

The investment marks a strong endorsement of Calix’s Zero Emissions Steel Technology, also known as Zesty. The process replaces the traditional reliance on coal with a combination of electric heat and hydrogen to reduce iron ore into a form suitable for steelmaking. By lowering hydrogen use and enabling the consumption of lower grade ores and fines, the Zesty approach is positioned as a cost effective pathway for producing green iron at scale. The technology also accommodates intermittent renewable energy, a feature that appeals to both miners and manufacturers aiming to align operations with clean power sources. The demonstration plant will be built on the same site that had previously been allocated for Rio Tinto’s BioIron pilot facility. It is expected to produce up to thirty thousand tonnes of hydrogen reduced iron or hot briquetted iron each year. A final investment decision for the full build out is anticipated in 2026, supported by an ARENA grant of up to forty four point nine million dollars, provided matching funding is secured.

BioIron Paused as Technical Adjustments Become Necessary

The company’s decision to pause BioIron comes as it re evaluates the furnace design and performance requirements of the biomass and microwave based process. BioIron was initially presented as a major innovation that could replace coal with agricultural waste and renewable energy powered microwave heating to convert Pilbara iron ore into metallic iron. Rio Tinto had planned to invest more than two hundred million Australian dollars in the research facility and pilot plant. In its update, Rio Tinto emphasised that the decision does not represent an abandonment of BioIron. The company stated that the technology still holds long term potential, but current engineering challenges must be addressed to meet performance and reliability standards. Continued research and development will focus on improving the furnace design, reducing operational risk and ensuring that the process can support commercial scale production in the future.

Read more: Harbinger Secures $160 Million as FedEx Places First Order for Its Electric Trucks

Decarbonising Steelmaking Remains a Global Imperative

Steel production accounts for between seven and nine percent of global emissions linked to fossil fuel use. As major manufacturers seek to decarbonise supply chains, demand for low emission steel is expected to rise sharply. This creates a competitive landscape where multiple new ironmaking technologies are being evaluated, including hydrogen direct reduction, electrification and biomass based fuels. Rio Tinto’s decision to diversify its portfolio of low carbon pathways reflects both the urgency of the challenge and the uncertainties inherent in emerging technologies. Matthew Holcz, Chief Executive of Rio Tinto Iron Ore, noted that the world will require new solutions for producing low emission steel, and that Pilbara iron ores could play a central role as innovation accelerates. His comments reflect the company’s broader strategy to align its product offering with global climate ambitions.

Zesty Demonstration Plant Gains Momentum with Industry and Government Support

The Zesty project is gaining institutional backing as it moves toward commercial readiness. Under the new agreement, Rio Tinto will supply up to ten thousand tonnes of Pilbara iron ores for commissioning and early testing. The company will also provide technical expertise, engineering support and market introductions to help Calix navigate the path toward final investment approval. Calix Chief Executive Phil Hodgson described the partnership as a major step forward in bringing the technology from concept to industrial scale. Access to Rio Tinto’s global networks, operational knowledge and financial support strengthens the project’s prospects of becoming a competitive alternative to conventional ironmaking.

Explore OneStop ESG Marketplace: Sustainability

Positioning for the Next Phase of Low Carbon Steel Innovation

Rio Tinto’s dual move to accelerate Zesty while refining the BioIron approach reflects the evolving nature of steel decarbonisation. The industry is testing multiple routes in search of processes that balance technical reliability, cost, scalability and emissions performance. With this investment, Rio Tinto signals that flexible and hydrogen capable solutions may provide a faster near term pathway to market than initially expected. As global demand for low emission steel grows and governments increase support for clean industrial technologies, Rio Tinto’s ability to advance several options simultaneously may determine how quickly it can meet both customer expectations and climate commitments. The company’s next steps will be closely watched as steelmakers, policymakers and investors continue to search for credible methods to reduce one of the world’s most challenging sources of industrial emissions.

Explore ESG Solutions on our marketplace - OneStop ESG Marketplace.

Keep abreast of the top ESG Events on OneStop ESG Events.

OneStop ESG Educate: Your go-to source for top ESG courses and training programs tailored to your needs.

Stay informed with the latest insights on OneStop ESG News.

Discover meaningful career opportunities on OneStop ESG Jobs.