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The global demand of steel production is growing, and so are the carbon dioxide emissions from the sector. Research has confirmed that 15 to 20% further energy efficiency improvement is possible, which would reduce the sector's greenhouse gas emissions and help meet global emission reduction initiatives. In this context, this research aims at developing a bottom-up system-based model to evaluate the long-term potential of energy efficiency alternatives in greenhouse gas mitigation. A case study was conducted for the Canadian iron and steel sector. The developed framework involves review of the state of the art in iron and steel production technologies, demand tree development, energy-environmental modeling, scenario development, and analysis. Twenty-six mitigation scenarios were developed in planning horizons ending in 2030 and 2050. A 13% improvement in Canadian iron and steel energy efficiency could be achieved by increasing the production share of the electric arc furnace route from 41% in the base year to 56% by 2050. The results of the analysis suggest that 19 and 38 million tonnes of greenhouse gas emission reduction are achievable in the 2010–2030 and 2010–2050 planning horizons, respectively. This translates to an approximately 6% reduction in emissions compared to the baseline scenarios at a cost of − $76 and − $51 per tonne of carbon dioxide equivalent in the 2010–2030 and 2010–2050 time periods, respectively. The results also reveal that more than 85% of the potential emission reductions are achievable with negative costs and are economically attractive. The study provides insights to decision makers at different levels of industry and government. [ABSTRACT FROM AUTHOR]