Auto sector’s green steel ambitions hinge on location

First delivery to Volvo highlights industry’s appetite for green steel—but the rise of electric vehicles is likely to impact overall demand

Chinese-owned automaker Volvo took delivery of its first shipment of green steel in August in a landmark development for industry. The steel was produced in northern Sweden, using technology based on green hydrogen from low-carbon electrolysis in a joint venture between an electrical utility, an iron ore miner, and a steelmaker. Small in volume and expensive, the unique product is a proof-of-concept for decarbonizing steel—one of the hardest-to-abate sectors. Global steel production accounts for 7-8pc of total global emissions. But the challenge for the auto industry and the steelmakers supplying them will be identifying the locations where electrolysis from renewables can come together easi