Rio Tinto's A$35 million investment in Calix’s green steel tech signals a new era for decarbonisation in Western Australia

Rio Tinto has committed over A$35 million (approximately $22 million) to support the advancement of Calix’s hydrogen-enabled Zesty steel technology in Western Australia, marking a significant step in the company’s portfolio approach to industrial decarbonisation. This investment underpins a joint development agreement aimed at accelerating a demonstration plant in Kwinana, south of Perth, that strives to produce low-emissions iron from Pilbara ore through a novel combination of electric heating and hydrogen reduction.

The Zesty Green Iron plant project represents a strategic pivot away from the earlier BioIron programme, Rio Tinto’s internally developed low-carbon iron-making process that uses biomass and microwave energy. Despite the promise of BioIron in potentially reducing emissions by up to 95% compared to traditional methods, Rio Tinto found that its furnace configuration required further technical refinement to mitigate risks. Nevertheless, the company continues to advance the BioIron technology in partnership with the University of Nottingham and Metso, illustrating a broader commitment to multiple decarbonisation pathways.

Accessing alternative routes like Calix’s technology is particularly important as it can process lower-grade iron ore, a critical advantage for steelmakers seeking scalable solutions adaptable to varying ore qualities. The Zesty approach utilises Calix’s electric calciner technology integrated with hydrogen, aligning with the broader industry imperative to reduce emissions from steel production, which currently accounts for an estimated 8% of global greenhouse gases. The technology’s licence agreement grants Rio Tinto non-exclusive global access, enabling it to deploy or sub-license the Zesty process across its extensive customer network, potentially enhancing its reach well beyond the Australian market.

Matthew Holcz, Rio Tinto Iron Ore Chief Executive, encapsulated the strategy by highlighting the increasing global demand for low-emissions steel and the necessity to position Pilbara iron ores effectively within emerging technology landscapes. Rio Tinto’s operational support for the project includes providing technical expertise, engineering assistance, and up to 10,000 tonnes of Pilbara ore for early-stage testing and commissioning, reflecting a hands-on commitment to developing this new production route.

Western Australia’s government has been a proactive partner in fostering the green iron industry, aiming to transform the state into a renewable-energy-based manufacturing hub. Premier Roger Cook emphasised the state’s “if not, why not” stance on green steel procurement for major public projects, signalling strong policy support. The Kwinana industrial zone offers strategic advantages, combining established utilities, export infrastructure, and proximity to downstream initiatives such as the NeoSmelt project, a consortium effort including Rio Tinto, currently advancing low-carbon smelting options compatible with the Zesty direct reduced iron product. This synergy exemplifies Western Australia’s approach to embedding green ironmaking within a broader industrial ecosystem.

Financially, this collaboration benefits from a mixture of private and public funding. In addition to Rio Tinto’s investment, the project leverages a previously announced A$44.9 million grant from Australia’s Clean Energy Finance Corporation (ARENA), contingent upon the achievement of development milestones. For Calix, the deal is a critical endorsement that supports scaling their technology and linkage into global supply chains, which CEO Phil Hodgson described as essential to future-proofing Australia’s iron ore sector amid tightening global carbon constraints.

Rio Tinto’s comprehensive decarbonisation agenda extends beyond this project. Earlier in 2024, the company announced a separate A$210 million ($143 million) initiative to develop a cutting-edge BioIron R&D facility in Western Australia, aiming to validate this low-carbon ironmaking process further with pilot plant operations anticipated by 2026. Alongside, Rio Tinto’s work in Canada secured C$18 million ($13 million) from the government to decarbonise iron ore processing, targeting a reduction of 2.2 million tonnes of greenhouse gas emissions over the project lifespan.

Moreover, Rio Tinto’s global collaborations showcase the firm’s broader commitment to steel decarbonisation, including memoranda of understanding with leading Chinese steelmakers such as Nanjing Iron and Steel Co and China Baowu to adapt low-grade ore utilisation and biomass technologies for steel production. Another significant joint venture announced late 2024 involves Rio Tinto teaming up with BHP and BlueScope Steel to build a pilot plant in Western Australia focused on producing low-carbon iron using Pilbara ores, further reinforcing Western Australia’s emerging position as a decarbonised steel hub.

However, the path to a green iron industry is not without scepticism. In mid-2025, Rio Tinto’s Chief Technical Officer Mark Davies candidly expressed doubts about the economic viability of hydrogen-based direct reduced iron production in Australia, citing high costs, technical challenges, and infrastructure expenses as significant barriers. This pragmatic stance underscores the complexity of transforming iron ore supply chains in a cost-competitive global steel market.

Internationally, Rio Tinto is advancing hydrogen steelmaking with European partners, such as supplying a majority of the iron ore for a zero-carbon steel plant at Voestalpine’s Linz site in Austria, scheduled to become operational by mid-2027. This project exemplifies progress in hydrogen-based steelmaking at a commercial scale, reinforcing the importance of diversified global decarbonisation efforts.

In sum, Rio Tinto’s collaboration with Calix on the Zesty Green Iron plant is a tangible move towards decarbonising ironmaking by leveraging innovative hydrogen and electric heating technology suited to a variety of ore grades. Supported by government funding, policy momentum in Western Australia, and integration into broader industrial initiatives, the project illuminates how resource-rich regions are reimagining their industrial future amid the global steel sector’s decarbonisation imperative. The outcome of this demonstration plant will be closely watched by industry and climate policy leaders worldwide, as it may set a precedent for scalable, economically viable green steel solutions using Australia’s abundant mineral resources.