Queensland and Sweden may not appear to have much in common, but both are looking to use abundant renewable energy to drive regional development.

In October 2021 the Queensland Government announced a partnership with Fortescue Future Industries to establish a manufacturing hub focused on renewable hydrogen in the regional centre of Gladstone. Job-creating projects are vitally needed in Gladstone, where the unemployment rate is more than double the national average.¹ The region is a centre of heavy industry and fossil fuel exports, which face major changes as the world decarbonises.

Sweden has also embraced the challenge of decarbonising heavy industry, particularly steel production, producing the world’s first fossil fuel-free steel in mid-2021.² This was achieved through collaboration between steel manufacturer SSAB, state-owned energy company Vattenfall and iron ore miner LKAB. The group are on track to commercialise green steel by 2026, 10 years earlier than previously thought possible.³ 

The green steel collaboration has now led to Sweden’s Volvo producing the world’s first vehicle made of fossil-free steel.⁴ The group of companies are looking to commercialise green steel vehicles and to use any surplus hydrogen from the steel manufacturing process in hydrogen fuel cell vehicles.⁵

Facilitating Sweden’s greening of heavy industry is cheap renewable energy. Wind and hydro power are abundant in Sweden’s north, often selling for a fraction of the prices seen in other parts of the country.⁶ The major industrial partners in Sweden’s decarbonisation initiatives are explicit that “to achieve this ambition, the necessary infrastructure, access to fossil-free electricity in particular, must be in place in time.”⁷

Above: Steel making using green hydrogen. Source: Ovako

But beyond cheap, clean energy, Sweden has a range of policies and collaborations that not only aim to decarbonise heavy industry, but also to drive regional development. The initiative aims to attract 25,000 new residents to northern Sweden within five years and 100,000 new residents by 2035. This represents a 20% increase in population for the northernmost counties, an area that, like much of regional Australia, has seen long term declines in population.⁸

Importantly, the problems associated with rapid population growth and development are being anticipated. A national coordinator has been appointed to ensure challenges around social transformation, housing, infrastructure and skills are addressed. ⁹

In promoting northern Sweden as a place to live and work, the initiative focuses not just on the availability of jobs and the highlights of the natural landscape, but also on social services, health, education and quality of employment: 

Snow blizzards. Check. Long winters. Check. But we also have 24-hour sunlight all summer long, unparalleled skiing and hiking through breathtaking mountainous regions that stretch from the Arctic Circle toward southern Sweden. Oh yeah, and 16 months of paid parental leave, at least 5 weeks of paid vacation, and universal healthcare, education and childcare. What are you waiting for?¹⁰

While Sweden’s programs to decarbonise industry and develop its northern regions are only just beginning, with similarities in energy infrastructure, and comparable challenges in supporting communities through industrial transition, Australia has an opportunity to adopt Sweden’s approach to investing in manufacturing communities in its transition to green energy.

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[1] National Skills Commission (2021) Small Area Labour Markets, September Quarter 2021, https://lmip.gov.au/default.aspx?LMIP/Downloads/SmallAreaLabourMarketsSALM.

2 Vetter (2021) How Sweden Delivered the World’s First Fossil Fuel-Free Steel, https://www.forbes.com/sites/davidrvetter/2021/08/19/how-sweden-delivered-the-worlds-first-fossil-fuel-free-steel/?sh=4b8a328d6b55

3 Mazengarb (2020) Nordic steel giant to use renewable hydrogen to produce fossil-free steel by 2026, https://reneweconomy.com.au/nordic-steel-giant-to-use-renewable-hydrogen-to-produce-fossil-free-steel-by-2026-2026/

4 SSAB (2021) SSAB’s fossil-free steel featured in Volvo Group’s vehicle, https://www.ssab.com/news/2021/10/ssabs-fossilfree-steel-featured-in-volvo-groups-vehicle

5 Volvo (2021) Green steel collaboration – Volvo Group, SSAB and Ovako, https://www.volvogroup.com/en/future-of-transportation/going-fossil-free/green-steel-collaboration.html

6 Market prices for the four parts of Sweden’s electricity market can be observed at: Nordpool (2022) Day-ahead prices, https://www.nordpoolgroup.com/Market-data1/Dayahead/Area-Prices/SE/Hourly/?view=table

7 SSAB (2021) SSAB plans a new Nordic production system and to bring forward the green transition, https://www.ssab.com/news/2022/01/ssab-plans-a-new-nordic-production-system-and-to-bring-forward-the-green-transition

⁸ SVT (2021) Historic investment in the north in fossil-free industry - requires 100,000 immigrants, https://www.svt.se/nyheter/lokalt/norrbotten/historisk-satsning-i-norr-kraver-100-000-inflyttare; Vattenfall (2021) Wanted: 25,000 new inhabitants to Norrland!, https://group.vattenfall.com/se/nyheter-och-press/nyheter/2021/sokes-25-000-nya-invanare-till-norrland

⁹ SVT (2020) The billion projects in the north get a national coordinator, https://www.svt.se/nyheter/lokalt/vasterbotten/miljardprojekten-i-norr-far-nationell-samordnare

¹⁰ Mind Dig (n.d.) Life in the Swedish Arctic isn’t what you’d expect, https://www.minddig.com/lifestyle