Can Clean Iron Tech Make Data Centres More Sustainable?

The demand for steel to support the global expansion of data centres and electric vehicles continues to surge – yet traditional production methods remain among the most carbon-intensive industrial processes on Earth. 

Colorado-based startup Electra believes it has found a cleaner alternative, and now counts Meta, Nucor and Toyota Tsusho America among its early partners as it moves toward commercial deployment.

The company has unveiled plans for a new demonstration plant in Jefferson County, Colorado, that could begin producing clean iron by mid-2026. 

The facility represents a critical milestone in the commercialisation of Electra’s “electrowinning” technology – an electrochemical process powered by renewable energy that replaces fossil-fuelled blast furnaces with a low-temperature, low-emission alternative.

Scaling clean iron for the digital age

Steel is essential to nearly every industrial sector, from construction and automotive manufacturing to the racks, cooling systems and structural frameworks inside hyperscale data centres. Yet the industry is responsible for roughly 9% of global greenhouse gas emissions, most of which are produced by coal-fired blast furnaces.

Electra’s process uses electricity rather than heat to separate iron from ore. By operating with renewables at a temperature comparable to that of a cup of coffee, the process removes the need for coal and high temperatures that drive most emissions in conventional steelmaking.

“We started Electra to fundamentally reinvent the way the world makes iron and tackle one of the biggest sources of industrial emissions, but we’ve always known we could not do it alone,” says Sandeep Nijhawan, Co-Founder and CEO of Electra, speaking to Canary Media. “With binding commitments and support from strategic partners, we are proving that pure iron can be made resourcefully and scaled quickly to meet global demand.”

The demonstration project will be housed in a 130,000-square-foot facility south of Electra’s Boulder headquarters. Supported by a US$50m grant from Breakthrough Energy Catalyst programme alongside US$186m in private investment and a US$8m tax credit from the Colorado Energy Office, the site will have the capacity to produce up to 500 metric tonnes of iron per year.

Though that output is small compared to the 1.4 billion tonnes of iron produced globally in 2023, the facility will prove the technology’s viability and scalability for industrial applications – including data centre construction, where sustainability is an increasing priority.

Partnerships driving low-carbon materials

Electra’s partners include Nucor, the largest steel producer in the US and an early investor in the company. Nucor has committed to purchasing clean iron from the new facility for use in its electric arc furnaces. 

Toyota Tsusho America will also purchase and distribute Electra’s iron to steelmakers supplying the automotive sector, while Germany’s Interfer Edelstahl Group will use it in its specialty steel operations.

“The advanced purchase commitments with Electra are a clear demonstration of Nucor’s belief in their clean iron technology and our dedication to accelerating the adoption of sustainable steelmaking,” says Al Behr, Executive Vice President of Raw Materials at Nucor.  

“We’re excited to see Electra’s demonstration facility become a reality, marking an important milestone in our partnership and in the journey to decarbonise the steel supply chain. This facility lays the groundwork for a new era of low-carbon materials, and we’re proud to support Electra as they scale their innovative solutions.”

Meta has taken a different approach. Rather than purchasing iron directly, the technology giant has signed an agreement to acquire environmental attribute certificates from Electra. These certificates will allow Meta to claim the emissions reductions associated with Electra’s clean iron production toward its own sustainability targets.

Through this offtake agreement, Meta is working towards demonstrating "a pathway for these innovative materials to scale," says John DeAngelis, Head of Clean Technology Innovation at Meta. 

“Meta is excited to partner with Electra to drive the development of low-carbon iron and steel – essential materials for building data centres – manufactured right here in the US,” adds Devon Lake, Head of Net Zero Strategy at Meta, writing on LinkedIn. 

Reinventing ironmaking without hydrogen

While much of the steel industry’s decarbonisation focus has been on using green hydrogen in direct reduced iron processes, Electra’s ‘electrowinning’ approach avoids hydrogen altogether. 

Instead, the process dissolves iron ore into a water-based solution, then uses electricity to deposit pure iron onto sheets. This enables the use of lower-grade ores that would otherwise be uneconomical and allows operations to flex in response to renewable energy availability.

The technology’s ability to run on intermittent renewable power is particularly relevant for data centre operators like Meta, which are seeking ways to reduce the embedded carbon footprint of their infrastructure. By aligning material production with clean energy supply, Electra’s process offers a potential model for decarbonising supply chains that feed into hyperscale and data centre construction.

Electra sources 100% renewable energy for its pilot operations in Boulder through a partnership with Xcel Energy, and it plans to do the same for the new Jefferson County facility.

Looking ahead to commercial deployment

Founded in 2020 by Sandeep Nijhawan and Quoc Pham, Electra is now preparing for the next stage of growth.

The company operates two pilot plants in Boulder and is already scouting locations for its first commercial-scale manufacturing site, targeted to begin operations by 2029.

The road to scale will not be without challenges. Green steel developers across the globe have faced volatile funding conditions, policy uncertainty and fluctuating energy prices. In the US, recent changes to federal hydrogen funding programmes have slowed progress on some low-carbon steel initiatives.

Still, Sandeep remains optimistic about Electra’s role in transforming one of the world’s most polluting industries. He insists that the steel industry is “definitely in this phase where the [green steel] transition and meeting climate goals looks a lot more difficult today.

“I believe the solutions are in hand, and it’s a matter of scaling to drive those economics as fast as we can,” he adds though.

For the fast-growing data centre sector, where sustainability goals are now central to investment and development, Electra’s partnership with Meta signals a broader shift. 

Clean materials and renewable-powered manufacturing are becoming as critical to the next generation of digital infrastructure as compute and cooling – redefining what it means to build responsibly in the AI era.