The green residue is comprised of algae that have grown in the water. If you know anyone who's got a swimming pool they might be able to provide you with some chemicals to remove it but, to be honest, I doubt that they'd work very well. (When you're cleaning a swimming pool you can either manually scrub the sides or use a pressure hose, to assist the chemical cleaning. You obviously can't do anything similar inside a steam iron).
It would probably be simpler to replace the iron. The one I've got now is the best I've ever had, and it only cost around �4 (Tesco 'Value' range).
Chris