**5. Discussion**

The aim of this study was to explore how different choices, with respect to technological development in the Swedish steel industry, impact energy use, CO2 emissions and cost over time. However, it should be noted that the steel production pathways assessed in this study are exploratory and not intended as projections.

It should also be pointed out that this study does not consider the variation of scrap availability and demand in the investigated pathways. For all investigated alternative pathways scrap consumption should increase from 2025 due to replacement BF/BOF by EAF. A global increase in scrap availability due to stocks building up in emerging economies is expected [46] while the availability in the EU will stabilize, as steel stock saturates [47]. In addition, it is important to prioritize innovation and technological development related to delivering the highest quality of steel from recycling (EAF) (see e.g., [48]).

Furthermore, the uncertainty of the steel production cost results obtained in this study may be larger than quantified by our analysis. The primary steelmaking process in Pathways 2, 3, hydrogen direct reduction, allows for flexible operation of the steel plant. The flexibility in the steelmaking process benefits form periods of low electricity price, and this becomes particularly important for electricity systems with a high share of variable renewables. However, it also brings investments in storage technologies and additional investments in production capacities (electrolyzer, direct reduction shaft, EAF). This study did not assess these consequences of flexibility. Furthermore, the introduction of the carbon price, by means of carbon credits and/or carbon tax can be estimated to increase the competitiveness of steel production via alternative processes (Pathways 1–3). Feliciano-Bruzual C. [49], shows that the price of carbon emission in the range of 40–190 €/t CO2 could make charcoal substitution economically competitive.

Finally, in two of the pathways the study assumed Swedish steel production will remain constant at the 2017 level until 2045. Steel is a globally traded good and steel demand internationally is a ffected by several factors, e.g., state of the global economy, and therefore development in a region, such as the Swedish steel industry, is di fficult to predict. However, change of future demand and production levels obviously will have major impacts on the results for energy use and CO2 emissions.

Only a relatively small share of the steel produced in Sweden has a domestic end-use, i.e., most (>85%) of the steel produced in Sweden is exported. Still, even though mitigating CO2 emission by using less steel has a limited potential on national basis such e fforts will: (i) limit the use of steel; (ii) maximize upgrading, recycling and reuse of steel already in use; (iii) switch to lower- CO2 materials; and (iv) use less steel for same function. These aspects will be important to decrease carbon dioxide emissions related to steel production and to reach the long-term emission reduction goals.

Steelmaking firms seeking to invest in high-cost high-risk (but low-CO2) technology face a dilemma. On the one hand, it is di fficult to motivate and find a business case for investments away from traditional and established technologies, especially in the currently uncertain policy regime, on the other hand, a failure to invest in a shift to less carbon-intensive technology is incompatible with the Paris Agreement. Thus, it is worth pointing out, which is also done in other work [4], that a current policy mix targeting the basic material industry will need to be accompanied by complementary policy interventions and/or private initiatives to secure financing and lower the financial risk in investments for decarbonization up to 2045.
