SynopsisIndia, the world's second-largest producer of steel and cement, confronts a monumental challenge on the road to reducing carbon emissions. A recent study by the Council on Energy, Environment, and Water (CEEW) reveals that to attain net-zero carbon emissions, these industries necessitate a colossal INR 47 lakh crore (USD 627 billion) in additional capital expenditure (CAPEX). They also require INR 1 lakh crore annually in additional operational expenditure (OPEX) for the net-zero endeavor.ArticleIndia, the world's second-largest producer of steel and cement, is facing a colossal challenge in its efforts to reduce carbon emissions. A recent study by the Council on Energy, Environment, and Water (CEEW) reveals that these industries need a staggering INR 47 lakh crore (USD 627 billion) in additional capital expenditure (CAPEX) to achieve net-zero carbon emissions.These industries play a pivotal role in the country's economic development but are also notorious for their high emissions, making the path to decarbonization complex. In addition to the CAPEX requirement, they will need INR 1 lakh crore each year in additional operational expenditure (OPEX) to reach net-zero.The CEEW analysis, supported by 'bp,' an integrated energy company, indicates that it's possible to reduce steel emissions by 8-25% and cement emissions by 32% without raising production costs. This can be achieved by implementing energy-efficient technologies like waste-heat recovery and energy-efficient drives and controls. Importantly, these substantial emissions reductions do not require carbon capture technology or additional fuel supply.Dr. Arunabha Ghosh, CEO of CEEW, emphasizes that decarbonizing these industries is not only vital for India's climate goals but also for ensuring their competitiveness in a global market increasingly focused on sustainability. The CEEW's analysis provides a foundation to quantify emissions mitigation potential and associated costs, aiding policymakers in their pursuit of net-zero targets without deindustrialization.In 2021-22, the Indian steel industry emitted 297 million tonnes of CO₂ during crude steel production, resulting in an average emission intensity of 2.36 tCO₂/tcs, higher than the world average of 1.89 tCO₂/tcs. Achieving near net-zero steel production could increase costs by 40-70% depending on the chosen production route and technology, as well as the costs of carbon capture, utilization, and storage (CCUS). CCUS holds the potential to reduce steel industry emissions by as much as 56%, but its full-scale implementation remains a challenge.The Indian cement industry is considered one of the world's most energy-efficient, yet it emits substantial CO2 due to limestone processing. In 2018-19, this industry emitted 218 million tonnes of CO2 while producing 337 million tonnes of cement. Carbon management methods can substantially reduce these emissions, but they come with higher costs compared to alternatives like energy efficiency, alternative fuels, and raw materials. Importantly, approximately 50% of Indian cement plants need access to CO2 pipelines for carbon capture and storage.To achieve a net-zero steel and cement industry, the CEEW recommends embracing energy-efficient technologies that are already available. Incentivizing renewable energy, particularly by eliminating or reducing transmission charges at the central and state levels, will also play a vital role in decarbonization. Moreover, the Indian government should develop policies to expedite the establishment of a CCUS ecosystem, focusing on hydrogen production and storage.ConclusionThe journey to make India's steel and cement industries net-zero is an ambitious endeavor with substantial costs and technological challenges. However, by implementing energy-efficient solutions and advancing carbon capture technology, these industries can significantly reduce their emissions, aligning with India's climate goals and global sustainability trends.
SynopsisIndia, the world's second-largest producer of steel and cement, confronts a monumental challenge on the road to reducing carbon emissions. A recent study by the Council on Energy, Environment, and Water (CEEW) reveals that to attain net-zero carbon emissions, these industries necessitate a colossal INR 47 lakh crore (USD 627 billion) in additional capital expenditure (CAPEX). They also require INR 1 lakh crore annually in additional operational expenditure (OPEX) for the net-zero endeavor.ArticleIndia, the world's second-largest producer of steel and cement, is facing a colossal challenge in its efforts to reduce carbon emissions. A recent study by the Council on Energy, Environment, and Water (CEEW) reveals that these industries need a staggering INR 47 lakh crore (USD 627 billion) in additional capital expenditure (CAPEX) to achieve net-zero carbon emissions.These industries play a pivotal role in the country's economic development but are also notorious for their high emissions, making the path to decarbonization complex. In addition to the CAPEX requirement, they will need INR 1 lakh crore each year in additional operational expenditure (OPEX) to reach net-zero.The CEEW analysis, supported by 'bp,' an integrated energy company, indicates that it's possible to reduce steel emissions by 8-25% and cement emissions by 32% without raising production costs. This can be achieved by implementing energy-efficient technologies like waste-heat recovery and energy-efficient drives and controls. Importantly, these substantial emissions reductions do not require carbon capture technology or additional fuel supply.Dr. Arunabha Ghosh, CEO of CEEW, emphasizes that decarbonizing these industries is not only vital for India's climate goals but also for ensuring their competitiveness in a global market increasingly focused on sustainability. The CEEW's analysis provides a foundation to quantify emissions mitigation potential and associated costs, aiding policymakers in their pursuit of net-zero targets without deindustrialization.In 2021-22, the Indian steel industry emitted 297 million tonnes of CO₂ during crude steel production, resulting in an average emission intensity of 2.36 tCO₂/tcs, higher than the world average of 1.89 tCO₂/tcs. Achieving near net-zero steel production could increase costs by 40-70% depending on the chosen production route and technology, as well as the costs of carbon capture, utilization, and storage (CCUS). CCUS holds the potential to reduce steel industry emissions by as much as 56%, but its full-scale implementation remains a challenge.The Indian cement industry is considered one of the world's most energy-efficient, yet it emits substantial CO2 due to limestone processing. In 2018-19, this industry emitted 218 million tonnes of CO2 while producing 337 million tonnes of cement. Carbon management methods can substantially reduce these emissions, but they come with higher costs compared to alternatives like energy efficiency, alternative fuels, and raw materials. Importantly, approximately 50% of Indian cement plants need access to CO2 pipelines for carbon capture and storage.To achieve a net-zero steel and cement industry, the CEEW recommends embracing energy-efficient technologies that are already available. Incentivizing renewable energy, particularly by eliminating or reducing transmission charges at the central and state levels, will also play a vital role in decarbonization. Moreover, the Indian government should develop policies to expedite the establishment of a CCUS ecosystem, focusing on hydrogen production and storage.ConclusionThe journey to make India's steel and cement industries net-zero is an ambitious endeavor with substantial costs and technological challenges. However, by implementing energy-efficient solutions and advancing carbon capture technology, these industries can significantly reduce their emissions, aligning with India's climate goals and global sustainability trends.
