1. Introduction

The iron and steel industries are significant economic contributors in India. The current annual installed capacity of ~130 million tonnes (MT) (IBM 2018) can only support a per capita steel consumption of ~70 kilograms compared with a global average of 224 kilograms (MoS 2019). Economists often use per-capita steel consumption as an indicator of socioeconomic development and the income levels of a country. The National Steel Policy 2017 aims to bridge the gap by supporting additional investments to boost the domestic production capacity to 300 MT by 2030 (MoS 2019). Whilst the policy promotes economic development, it does very little to incentivise investment in mitigating the additional environmental effect from the over two-fold increase in production (capacity).

The steel sector is the single largest energy consumer, roughly accounting for 45 per cent of total industrial consumption in 2016. The sector’s energy mix is dominated by coal and its derivatives that cater to 90 per cent of the demand. Coal has a significantly higher emissions footprint, with the resultant emissions from the sector representing ~42 per cent of India’s overall industrial greenhouse gas (GHG) emissions. Between 2010 and 2017, the share of coal-based production increased from 73 per cent to 87 per cent, despite the presence of coal, gas, and electricity-based production assets (Gupta et al. 2019). Limited availability of domestic gas supply and high cost of imports are gradually pushing industries to rely on coal instead. Thus, potentially offsetting the gains made through the programmatic pursuit of energy efficiency. There is a need for a clear policy that looks beyond the incremental process efficiency gains and aims for the deep decarbonisation of industrial energy use.

The steel sector accounted for 45% of total industrial energy consumption in 2016

Green steelmaking can reduce our import dependence on coking/ non-coking coal and make us Aatmanirbhar.