India: Decarbonizing

DECARBONIZING
INDIA
IRON AND STEEL SECTOR
Decarbonizing India’s Iron and Steel Sector report.indd 1 28/09/22 2:11 PM

DECARBONIZING
INDIA
IRON AND
STEEL
SECTOR
CENTRE FOR SCIENCE AND ENVIRONMENT

Research direction: Sunita Narain and Nivit Kumar Yadav
Author: Parth Kumar
Editors: Arif Ayaz Parrey and Akshat Jain
Design and cover: Ajit Bajaj
Graphics: Sanjit Kumar
Production: Rakesh Shrivastava and Gundhar Das
Advisor: Dr Mukesh Kumar, Director, Steel Research and Technology Mission of India
The Centre for Science and Environment is grateful to the Swedish

International Development Cooperation Agency (Sida) for their
institutional support.
© 2022 Centre for Science and Environment
Material from this publication can be used, but with acknowledgement.
Maps used in this document are not to scale.
Citation: Parth Kumar 2022, Decarbonizing India: Iron and Steel Sector, Centre for Science and
Environment, New Delhi
Published by
Centre for Science and Environment
41, Tughlakabad Institutional Area
New Delhi 110 062
Phones: 91-11-40616000
Fax: 91-11-29955879
Website: www.cseindia.org

CONTENTS
Background and introduction 7
Iron and steel industry in India—

production and policy 13
Manufacturing process and

related GHG emissions 21
Future production and capacity additions 31
GHG emissions from India’s steel sector 37
Future emissions: 2030 47
Pathways for carbon intensity

reduction in the steel sector 57
CSE proposal for steel sector's

decarbonization: Accelerated
low-carbon scenario 79
Decarbonizing India’s iron and steel sector:

Key findings and recommendations 75
Annexure 85
References 87

BACKGROUND AND
1
INTRODUCTION

BACKGROUND AND INTRODUCTION
1.1 GLOBAL CONTEXT

Combating catastrophic climate change is on the agenda of
governments around the world. Calls from climate change
prediction agencies to reduce greenhouse gas (ghg) emissions
grow more urgent every year. Countries across the globe have
decided to act and reduce their emissions drastically, with net
zero emission targets in sight. India has announced that it will
reach net zero emissions by 2070.
Anthropogenic emissions of carbon dioxide (co2) and other

greenhouse gases are the primary cause of climate change
and one of the most pressing challenges of the contemporary
world. Significant quantities of co2 and other greenhouse gases
are emitted every year. They join historical emissions already
present in the atmosphere and will themselves remain in the
air for hundreds of years. The increasingly high levels of co2 are
the cause of rise in average global temperature and are ‘forcing’
changes in the world’s climate.
Thus, current global warming is a result of both recent emissions

as well as emissions in the past. During the last three decades,
there has been a rapid and alarming rise in global co2 levels.
Annual global ghg emissions have grown by 50 per cent from
1990 to 2018 and are still on the rise.1 This cannot continue
without seriously jeopardizing human survival on this planet.
The significant sectors contributing to ghg emissions

worldwide are energy, agriculture, waste, industry, forestry and
land use. The energy sector remains the largest contributor—
with a 73.2 per cent share (36.2 gigatonne/gt). Of this, the
industrial sector contributes 24.2 per cent (12 gt), buildings
contribute 17.5 per cent (8.7 gt) and transport contributes 16.2
per cent (8 gt).
Iron and steel is a key sector, as it alone contributed 7.2 per

cent (3.5 gt) of total global emissions in 2016 (see Graph 1).

Graph 1: Global Iron and steel 7.2%
share of ghg
emissions by iron
Energy use in industry 24.2%
and steel sector
in 2016
Iron and steel sector is
responsible for almost
7.2 per cent of global
ghg emissions
Energy 73%
Source: Climate Watch, the

World Resources Institute, Energy Others
2020–212
1.2 INDIA’S GREENHOUSE GAS EMISSIONS

India submits data on its ghg emissions through the Biennial
Update Reports (bur) to the United Nations Framework
Convention on Climate Change (unfccc). The third such report,
submitted in 2021, revealed that India’s ghg emissions have been
steadily rising with the significant growth in its economy, from
1.4 gt of carbon dioxide equivalent (co2e) in 2005 to 2.8 gt co2e in
2016—this is without accounting for removals from forests and
other land-based sinks.
Table 1: GHG emissions in India in 2016 by sector

GHG sources and removals CO2 CO2 CH4 N2O HFC, CF4 C2F6 SF6 CO2e
(Gigagramme) emissions removal 23
Energy 2,064,840 NO 2072 68 NO NO NO NO 2,129,428
Industrial processes and product use 166,227 NO 187 11 2 4 1 0.004 226,407
Agriculture NO NO 14,423 339 NO NO NO NO 407,821
Land use, land-use change and forestry 21,289 330,765 55 2 NO NO NO NO -307,820
(LULUCF)
Waste NO NO 2820 52 NO NO NO NO 75,232
Total without LULUCF 2,231,068 --- 19,502 469 2 4 1 0.004 2,838,889
Total with LULUCF 2,252,356 330,765 19,557 471 2 4 1 0.004 2,531,069
Memo items 789,305 NO 1 0.13 NO NO NO NO 789,359
NO: Not occurring
Source: India, third Biennial Update Report to the United Nations Framework Convention on Climate Change, page 203

BACKGROUND AND INTRODUCTION
Graph 2: GHG emissions share of key categories in India without LULUCF for 2016
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
1A1a Electricity p roduction, CO2 39.53%
1A3b Road transport, CO2 8.57%
3A1 Enteric fer mentation , CH4 7.84%
1A2m Nonspecific industr ies, CO2 6.37%
1A2a I ron and steel, CO2 4.75%
1A4b Residential, CO2 4.47%
2A1 Cement production, CO2 3.75%
3C4 Agricultural soils, N2O 2.74%
1A1b Refinery, CO2 2.53%
3C7 Rice cultivation, CH4 2.51%
1A4a Commercials/ Institutional, CO2 2.42%
1A2f Cement, CO2 1.88%
2C3 Aluminium prod uction, CF 1.18%
2A2 Lime p roduction, CO2 1.00%
3A2 Manure management, N2O 0.87%
Source: India—Third Biennial Update Report to The United Nations Framework Convention on Climate Change, page 1764
The energy sector is the biggest contributor to ghg emissions in

India (as it is in the rest of the world)—electricity production alone
contributes around 40 per cent of the country’s emissions.
The share of industrial processes and product use category in

India’s ghg emissions is roughly 8 per cent. As per the third bur,
Indian iron and steel sector contributed 135 million tonne, or 4.75
per cent of the countrywide ghg emissions, in 2016.
10

IRON AND STEEL
2
INDUSTRY IN
INDIA—PRODUCTION
AND POLICY
11

IRON AND STEEL INDUSTRY IN
INDIA—PRODUCTION AND POLICY
China is the largest crude steel producer in the world, followed by

India, Japan, Russia and United States—but China is way ahead in
terms of production for any comparisons to be meaningful. As of
2020, the production of crude steel in China was almost 10 times
that of India, the second largest producer of crude steel in the
world (see Table 2).
A comparison of the increase in steel consumption in India with

the country’s gdp clearly shows the dependence of the Indian
economy on the steel sector. Steel consumption in India grew
from 6.5 mt in 1968 to 98.71 mt in 2018. During the same period,
the country’s gdp grew from 0.25 trillion to 2.7 trillion. The current
direct share of the steel sector in India’s gdp is around 2 per cent.
The indirect share of this sector in the economy is even bigger
because of the dependence of other sectors on steel production.
According to government data, the sector employs half a million

people directly and around two million people indirectly.
In 1947, India had only three steel plants—the Tata Iron and Steel
Company, the Indian Iron and Steel Company and Visveswaraya
Iron and Steel Ltd—and a few electric arc furnace-based plants.
Table 2: Top 10 crude steel producing countries in the world in 2020

Rank Country Quantity (in million tonne)* Per cent change over 2019
1. China 1,053 5.2
2. India 99.6 -10.6
3. Japan 83.2 -16.2
4. Russia* 73.4 2.6
5. United States 72.7 -17.2
6. South Korea 67.1 -6.0
7. Turkey 35.8 6.0
8. Germany 35.7 -10.0
9. Brazil 31.0 -4.9
10. Iran* 29.0 13.4
Top ten 1,580 0.4
World 1,864 -0.9
* Estimate or provisional figure
Source: Annual Report 2020–21, Ministry of Steel, Government of India, page 155

Graph 3: Comparison of growth in steel consumption in India with the GDP of India
30 GDP growth (%) Crude steel production growth (%)
25
20
Growth (per cent)
15
10
–5
–10
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
6
Source: Indian Steel Association and PwC report, The Indian steel industry: Growth, challenges and digital disruption, page 4, Data from World Bank
and World Steel Association, last retrieved on 20 September 2021
The sector witnessed substantial growth as public sector units

were set up post-1947. But by the late seventies, the sector’s
growth turned sluggish due to an economic slowdown, which
ended only in 1991–92 when the country moved towards
liberalization. This led to a considerable increase in steel capacity
of the country with the setting up of large integrated private
sector steel plants like esl Steel Ltd, Ispat Industries, jsw Steel,
Tata Steel (India) Ltd, etc.7
India’s crude steel production rose from 1 million tonne in 1947 to

roughly 111 million tonne in 2019.
As of 2020–21, India’s steel production capacity was almost 144

million tonne. The country’s capacity utilization stood at roughly
70 per cent.
The variety of iron and steel products that the industry

manufactures and the different routes to manufacture these
products have implications on the environment and the carbon
intensity of the sector.

Iron is basically an intermediate product in the manufacture of

steel. The primary form of steel produced is known as crude steel,
which is further sub-divided into different finished products. All
data and figures with respect to steel capacity and production
around the world are mostly in terms of crude steel.
Two main types of iron are used to manufacture steel. This

distinction is significant because the technologies used to
manufacture steel through the two processes differ, which has an
impact on their ghg emissions.
The first kind of iron used to manufacture steel is hot metal or

pig iron, which is mostly manufactured in blast furnaces (bf).
The liquefied form is known as hot metal whereas on solidifying
it is called pig iron. This iron is used as a raw material in a basic
oxygen furnace (bof) to make crude steel.
The other method to make crude steel is through the sponge iron
route. This is also known as direct reduced iron (dri). In this
process, the iron ore is not liquefied, but iron is extracted from the
Figure 1: Basic production flow diagram of iron and steel
Iron ore
Rotary kilns/vertical shaft
Blast furnace technology technology
Other Other
additives additives
Hot metal or Direct reduced
pig iron iron/sponge iron
Electric arc furnace/

induction furnace
Foundry-grade pig Steel-making
iron pig iron Crude steel
Basic oxygen furnace
Crude steel Steel scrap Finished steel
Finished steel
Source: Centre for Science and Environment
14

ore through reduction with the help of reducing agents in rotary
kilns (using coal) or through the vertical shaft technology (using
gas). dri is then used in electric arc furnaces (eaf) or induction
furnaces (if) to make crude steel (see Figure 1).
Steel scrap is also used as a raw material in both processes. The

only difference is that the basic oxygen furnace technology can
use steel scrap only up to a limited share (of around 30 per cent)
whereas electric arc furnaces and induction furnaces can run
entirely on steel scrap (based on the availability of scrap), as per
the World Steel Association (see box on important terms and
definitions related to iron and steel).
In 2020, the percentage of steel manufactured in India through

basic oxygen furnaces was 45 per cent; while the percentage of
steel manufactured by the dri method through eaf was 28 per
cent and through if was 27 per cent.
2.1 POLICY AND LOW-CARBON GROWTH

The National Steel Policy was created in 2005 to boost the sector.
The idea was to make the sector more efficient, productive
and at par with global standards. The 2005 policy provides for
environmental audit and life cycle assessment of existing steel
plants to allow relevant processes to help reduce emissions and
effluents, minimize and better manage solid wastes, and improve
resource conservation, but it does not mention any specific
emissions reduction targets for the sector.
In 2017, the National Steel Policy was reframed to create a new

vision for the sector till 2030–31. It sets out the direction of growth
as well as climate change targets for the sector.
As per this policy, India’s crude steel production capacity is

expected to rise to 300 million tonne by 2030—from 144 million
tonne currently. The per capita use of steel in India is expected to
be 160 kg by 2030–31, up from 74.6 kg in 2019–20. The global per
capita use of steel was 229 kg in 2019–20. So, India’s per capita
15

steel consumption will continue to be much lower even in 2030

than the global per capita steel use in 2019.8
The 2017 policy also projects a ghg trajectory for the sector based
on the country’s Nationally Determined Contribution (ndc).
According to the policy, by 2030, there will be 2.2–2.4 tonne of co2

emissions per tonne of crude steel produced through the blast
furnace-basic oxygen furnace (bf-bof) route.
The direct reduced iron-electric arc furnace (dri-eaf) route will

emit 2.6–2.7 tonne of co2 emissions per tonne of crude steel
produced. However, the policy states that efforts “will be made to
achieve aforesaid targets or even better targets at par with global
best practices, wherever possible.”
More importantly, the policy recognizes that coal-based steel

production has a huge environmental footprint and states
that “capacity additions through coal-based routes will have
far reaching implications for India in terms of environmental
degradation. Hence, necessary efforts will be made to have a
judicious mix of production routes to reduce the carbon footprint
of steel sector in line with the indc targets.”
16

IRON AND STEEL: IMPORTANT TERMS AND DEFINITIONS
TERMS RELATED TO IRON

• Iron ore: A naturally occurring mineral from which iron (Fe) metal is extracted in various forms,viz., hot
metal, dri, etc.
• Iron: Iron is a base metal extracted from iron ore.Pure iron has a melting point of around 1,530°C and
a density of 7.86 gm/cc.
• Hot metal (liquid iron): It is the hot,liquid,metallic iron product obtained upon reduction of iron
ore (normally in a blast furnace or in a Corex furnace).It contains about 93–94 per cent iron (Fe) and
other elements and impurities like carbon (4 per cent),silicon (~1 per cent),manganese (+1 per cent)
sulphur,phosphorus,etc.Hot metal is the primary input for production of steel in integrated steel plants.
• Pig iron: A product in solid (lumpy) form obtained upon solidification of hot metal in a pig casting
machine.It is called pig or pig iron because of its typical humpy shape.It is produced in two broad
categories or grades:
Foundry grade pig iron: Pig iron used in foundries for production of cast iron (ci) castings
using a Cupola furnace.This is the major use of pig iron.
Basic or steel-making grade pig iron: Pig iron (including hot metal) used in production
of steel.
• Direct reduced iron (DRI): Solid metallic iron product obtained upon direct reduction of high
grade iron ore in the solid state itself without being converted into liquid form like that in a blast furnace.
• Sponge iron (SI): dri is also known as sponge iron because of its spongy micro-structure.
TERMS RELATED TO STEEL

• Steel: Steel is an iron-based alloy containing carbon,silicon,manganese,etc.
• Crude steel: The term is internationally used to mean the first solid steel product upon solidification
of liquid steel.In other words,it includes ingots (in conventional mills) and semis (in modern mills
with continuous casting facility). According to International Iron and Steel Institute (IISI),for statistical
purposes,crude steel also includes liquid steel which goes into production of steel castings.
• Finished steel: Products obtained upon hot rolling or forging of semi-finished steel (blooms,billets
and slabs).These cover two broad categories of products,namely‘long products’and‘flat products’.
Source: Ministry of Steel, Government of India, 2021
17

MANUFACTURING
3
PROCESS AND
RELATED GHG
EMISSIONS
18

3.1 MANUFACTURING PROCESS AND RELATED GHG
EMISSIONS
The process used to manufacture steel and the fuel used in the
process are important determinants of the eventual ghg footprint.
In the blast furnace-basic oxygen furnace (bf-bof) manufacturing

process, iron ore is smelted with heat from burning coal. Coal
also acts as a reducing agent to turn the ore into metal. Therefore,
due to extensive use of coal in the process, it becomes harder to
decarbonize steel production.
In the electric arc furnace (eaf) manufacturing process, steel-

making is not dependent on the use of coal, but can use other
power and feed materials, which makes it easier to reduce
emissions. In this process, steel can also be made using recycled
scrap metal.
Around 70 per cent crude steel production in the world and 45

per cent crude steel production in India is through the bf-bof
technology. Coke, sinter, coal injection and, at times, pellets are
fed into the blast furnace (see Figure 2).
Waste heat from the processes in the coke oven and other parts
might also be used in the blast furnace for efficiency. Pig iron is
produced from the blast furnace which is then converted to steel
through a basic oxygen furnace. The end product is casted and
rolled into coils, plates, sections and, mostly, bars.
The major greenhouse gases emitted at different stages are

carbon dioxide (99 per cent), methane and nitrous oxide. The
important steps of the in situ process of bf-bof that contribute
to ghg emissions are coke production, sinter production and
pellet production (if carried out). Blast furnaces and basic oxygen
furnaces are also major contributors to greenhouse gas emissions.
In the electric arc furnace process, steel scrap is used as the major
raw material. It is melted in an electric furnace. Sponge iron is also
19

MANUFACTURING PROCESS AND
RELATED GHG EMISSIONS
Figure 2: Process flowchart of BF-BOF-based iron and steel production with points of GHG
emissions
Transferred off-site
Coking coal Coke plant Coke oven gas
Burned on-site, CO2,
CH4 and N2O
Coke
breeze
Sinter plant: Basic oxygen
CO2, CH4 and furnace gas
N2O
Iron ore
additives Pelletizing
plant Blast furnace
Steel-making
pig iron
(basic oxygen
production:
furnace): CO2,
Coal CO2, CH4 and Total steel
CH4 and N2O
injection N2O processing
Pig iron
to iron Direction of process
processing Byproduct
Raw material
Product
Source: IPCC guidelines for National Greenhouse Gas Inventories, 2006, page 4.13
Figure 3: Coke production process chart with points of GHG emissions
Used on-site in blast

CO2 and CH4 furnace or other
emissions integrated iron and
steel process
Used on-site
Metallurgical (e.g., sinter
coke Breeze plants) or off-site
Coke
Metallurgical Coke oven Coal tars and
oven Transferred off-site
coal and other gas and other light oils
process
process carbon byproducts
Coke oven heating Coke oven

gas (COG) COG transferred
off-site
Direction of process
Byproduct fuels from Connects to an external process
integrated iron and steel COG burned Process
(e.g., blast furnace gas) on-site Byproduct
Raw material
Product
Source: IPCC guidelines for National greenhouse gas inventories, 2006, page 4.14
20

Figure 4: Sinter production process chart with points of GHG emissions
Other Coke Blast

Natural
waste oven furnace
gas
gas gas gas
CH4 emissions
CO2 emissions
Coke
breeze
Sinter to blast
Iron ore furnace pig iron
Sintering
process production
Process
Byproduct
Raw material
Product
Figure 5: Pig iron production process chart with points of GHG emissions
Purchased Iron ore, Tar and

Scrap iron pellets & Coal Natural gas Dolomite Limestone
coke sinter oil
Integrated coke CH4 emissions

oven coke CO2 emissions
Blast Transferred to
furnace Blast furnace gas integrated coke
Integrated oven
Integrated coke oven
From coke oven byproducts
integrated coke oven gas
coke oven Burned on-site Transferred
Coal tar, Pig iron Slag within iron and
light oil off-site
steel process
and breeze
Transferred to Direction of process

Transferred
steel mills Connects to steel production
off-site Connects to an external process
Process
Byproduct
Raw material
Product
21

Figure 6: Illustration of steel making processes (including EAF and sponge iron
manufacture)
EAF Other non-

Natural Waste EAF charge Pig Scrap fuel carbon
Limestone Dolomite
gas gas anode carbon iron steel additions
Fuel oil Tar

Iron
ore
CH4 emissions CH4 emissions CH4 emissions CH4 emissions

CO2 emissions CO2 emissions CO2 emissions CO2 emissions
Direct
reduced/ Direct Electric arc Basic oxygen Open hearth
hot briquetted reduced/hot furnace (EAF) furnace (BOF) furnace (OHF)
briquetted
EAF steel Slag BOF steel Slag OHF steel Slag
Connects to an external process
Process
Byproduct
Raw material
Product
often used as a raw material in the electric arc furnace process as

a replacement for steel scrap. Sponge iron is also known as direct
reduced iron (dri) as direct reduction process is used to manufacture
sponge iron. It is a process in which oxygen is removed from iron
ore in the solid state without melting it as is done inside blast
furnaces. The electric arc furnace process and the production of
sponge iron also generate greenhouse gas emissions, majorly co2.
3.2 SHARE OF PROCESSES IN CRUDE STEEL

The most popular process is the basic oxygen furnace process
which has continued to maintain a share between 42 per cent
and 46 per cent in the overall production in India. It was assumed
at one point that a majority of steel-making units will shift to the
electric arc furnace technology, but that has not happened over
22

Graph 4: Trends in share of crude steel production processes in India
50
46 45 45
45 43 43 43 43 44
42 42
40
35 33 34
Percenttage share
32 32
30 30 30 30
30 28 28
25 27 27 26 26 27
26 26 25
24 23
20
15
10
0
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020*
Basic oxygen furnace Electric arc furnace Induction furnace
*Provisional
Source: Ministry of Steel, Government of India
the past decade. One of the reasons could be economic, especially

since electricity in India costs more than other easily available
fuels like coal. The share of electric arc furnace technology has
remained between 23 per cent and 30 per cent. Similarly, the share
of induction furnace technology has ranged between 30 per cent
and 34 per cent in the past decade (see Graph 4).
3.3 FUEL CONSUMPTION

According to the third Biennial Update Report submitted by India
to the United Nations Framework Convention on Climate Change
(unfccc) for 2015 and 2016, solid fuels dominate fuel consumption
patterns in the country. The consumption of solid fuels went
down between 2015 and 2016 and the consumption of gaseous
fuels went up marginally, but compared to the quantity of solid
fuels (mainly coal) being consumed by the iron and steel sector,
this change is almost negligible (see Graph 5).
Looking at the fuel usage in manufacturing of specific products

in this sector, one of the major products is sponge iron, of which
23

Map 1: Existing major iron ore mines, BF-BOF and EAF/IF capacities in India (2017)
Iron-ore mines
Existing major BF-BOF steel capacities
Existing major EAF/IF steel capacities
Source: National Steel Policy, 2017
24

Graph 5: Type of fuel consumption by the iron and steel sector
1,600,000 1,486,452
1,392,348 2015 2016
1,400,000
1,200,000
Fuel consumption (TJ)
1,000,000
800,000
600,000
400,000
200,000
45,951 45,951 21,439 38,394
0
Solid fuel Liquid fuel Gaseous fuel
Source: India, third Biennial Update Report to UNFCCC
Table 3: Production of sponge iron or DRI by fuel

Year 2016 2017 2018 2019 2020*
In million tonne
Coal-based 22.62 23.28 27.16 30.12 27.05
Gas-based 4.36 6.22 7.05 6.7 6.07
Total 26.98 29.51 34.21 36.82 33.13
*Provisional
Source: Annual Report 2020-21, page 14, Ministry of Steel, Government of India
India has been the largest producer. A majority of the sponge

or direct reduced iron comes from small-scale coal-based units
located in mineral rich states of India. Coal-based units were
responsible for 82 per cent of the production of sponge iron in
2020, whereas the rest of the production share was gas-based (see
Table 3).
The share of coal-based production of sponge iron has been quite

consistent. One possible reason behind this could be the non-
availability of natural gas in major steel-producing regions and
the high prices of natural gas in comparison to coal.
25

FUTURE
4
PRODUCTION
AND CAPACITY
ADDITIONS
26

4.1 PROJECTION OF FUTURE PRODUCTION
India plans to more than double its crude steel production by
2030, going from 111 million tonne in 2019 to 255 million tonne by
2030–31 (see Table 4).
Table 4: Projections of iron and steel production by 2030–31

Parameter Projections (2030–31)
Total crude steel capacity (in MTPA) 300
Total crude steel demand or production (in MTPA) 255
Total finished steel demand or production (in MTPA) 230
Sponge iron demand or production (in MTPA) 80
Pig iron demand or production (in MTPA) 17
Per capita finished steel consumption (in kg) 158
Source: Annual Report 2020-21, page 19, Ministry of Steel, Government of India
4.2 ADDITIONS AND TYPE

To be able to reach the capacity and production increase targets
set under the National Steel Policy, 2017, the big players of the
steel sector have already set expansion plans for the upcoming
decade (see Table 5).
An approximate capacity expansion of more than 120 million

tonne per annum over the existing 144 million tonne per annum
capacity is already being planned by large-scale steel producers
of India at the very beginning of the next decade. This planned
capacity expansion becomes even higher if we take the capacity
addition of medium- and smaller-scale players into consideration
and account for the fact that large-scale steel producing
companies are probably going to make announcements of further
expansion.
Thus, India will probably be able to meet its steel manufacturing

capacity target of 300 million tonne per annum by 2030 as set in
the National Steel Policy, 2017.
The only target that India may not be able to meet is limiting the
share of bf-bof steel production route to 65 per cent by that year.
27

FUTURE PRODUCTION AND
CAPACITY ADDITIONS
Table 5: Capacity expansion plans of major steel companies of India

S. no. Company Current Expansion plans
capacity (in
million tonne
per annum)
1. Steel 19.6 - SAIL is planning to increase its production capacity to 49.6 metric tonne per annum
Authority (MTPA), from its current capacity of 19.6 MTPA, by 2030, in two phases.
of India Ltd
(SAIL) - In the first phase, the capacity will be increased to 35.8 MTPA.
- Durgapur Steel Plant’s capacity will be enhanced to 7.5 MTPA from 2.5 MTPA in the
first phase.
- Rourkela Steel Plant’s capacity has been proposed to be expanded to 8.8 MTPA
from 3.7 MTPA in the first phase.
- Bokaro Steel Plant’s capacity will be expanded to 9.5 MTPA from the current 3
MTPA in the first phase.
- No plans for the Bhilai plant in the first phase, but its capacity is likely to be raised
to 12 MTPA from the current 7 MTPA and subsequently to 14 MTPA by 2030.
- IISCO plant’s capacity will also be raised to 7.3 MTPA from the current 3 MTPA.
2. Tata Steel 19.4 - A statement by Tata Steel (India) Ltd in February 2021 says that the company is
(India) Ltd planning to double its capacity to 40 MTPA.
- Tata Steel (India) Ltd has plans to increase its Kalinganagar Steel Plant’s capacity
by 5 MTPA from its current capacity of 3 MTPA by 2024.
3. JSW Steel Ltd 18 - JSW Steel is looking to add 14.8 MTPA capacity across its Dolvi plant
(Maharashtra), Vijayanagar plant (Karnataka) and Bhushan Power and Steel
Facility at Jharsuguda (Odisha) by 2024.
- JSW Steel completed its takeover of Bhushan Power and Steel Ltd, whose
capacity will be increased to 5 MTPA from 2.7 MTPA.
- Vijayanagar plant’s production capacity will be increased by 5 MTPA by March

2024, from its current capacity of 12 MTPA.
- The Dolvi plant’s capacity will be doubled from 5 MTPA to 10 MTPA.

4. Arcelor Mittal 10 - In June 2021, AM/NS India announced plans to increase their capacity to 30
Nippon Steel MTPA.
(AM/ NS)
India Ltd - AM/NS are planning to increase the capacity of the Hazira plant in Gujarat by 5
MTPA in the next three years, making its capacity 14 MTPA. In the next phase,
they plan to expand its capacity further to 18 MTPA.
- AM/NS are also planning to set up a 12 MTPA capacity integrated steel plant in
Odisha.
28

S. no. Company Current Expansion plans
capacity (in
million tonne
per annum)
5. Jindal Steel 8.6 - JSPL claims a target to grow its capacity from the current 9.6 MT to 50 MT in
and Power Ltd 2030.
(JSPL)
- JSPL is planning to add 6 MTPA capacity at its plant in Angul, Odisha by 2026,
which currently has a capacity of 6 MTPA.
- This will take JSPL’s overall capacity in India to 16 MTPA.

6. National - NMDC’s Nagarnar Integrated Steel Plant of 3 MTPA capacity is coming up as well.
Mineral
Development
Corporation
(NDMC)
7. Rashtriya 6.3 - RINL plans to expand its capacity to 11.7 MTPA.

Ispat Nigam
Ltd (RINL) - As a next step it will increase its capacity to 7.3 MTPA9
6. ESL Steel 2.5 - ESL Steel plans to add 4.5 MTPA to its capacity, taking it to a total of 7 TPA.10
Source: India Brand Equity,11 Business Standard,12 Economic Times,13 Indian Express,14 and Financial Express15
The majority of the proposed expansion is to happen through the

bf-bof route, despite it being an emission-intensive technology in
its current form.
In fact, India might end up with a much bigger share of bf-bof in

steel production by 2030 than targeted. This increase in the share
of steel production through the bf-bof route of production will
make it even more challenging for India’s steel sector to reduce its
overall ghg emissions. The reasons for this increase range from
the unavailability of good quality scrap, high price of natural gas
to scale of technology (see Box: Why is future expansion in the
steel sector of India mainly through the bf-bof route?).
This increase in the share of steel production through the BF-BOF

route of production will make it even more challenging for India’s
steel sector to reduce its overall GHG emissions.
29

FUTURE PRODUCTION AND
CAPACITY ADDITIONS
WHY IS FUTURE EXPANSION IN THE STEEL SECTOR MAINLY

THROUGH THE BF-BOF ROUTE?
A few big steel companies and public sector utilities (PSUs) hold a share of around 65 per cent of the
current steel production in India.In order to fulfil the capacity and production goals announced in the
National Steel Policy of 2017,these steel companies are expected to expand their capacities as much as
possible. A majority of the companies are planning to expand through the BF-BOF route.
Technologies like EAF/IF emit lesser CO2e compared to BF-BOF, but still the big players of the sector are
hesitant to invest in such technologies. Why? Some reasons are listed here:
1. Large-scale production capacity of BF-BOF: In order to increase production beyond a

certain level,it is important that the technology being adopted enables large-scale production.BF-BOF
is the only existing technology that enables carrying out production at that scale.The EAF technology
experimented with on ground in India has,till date,a much lower production capacity compared to BF-
BOF. Induction furnace technology is being utilized at an even lower scale.
2. Poor quality and non-availability of scrap: EAF/IF technologies are dependent on scrap as
a raw material but the availability of scrap is currently an issue in the country.Even the scrap available is
not of the best quality,which can result in poor quality steel production,especially in induction furnaces.
This has forced EAF/IF plants to use direct reduced iron or sponge iron in combination with steel scrap.
3. Non-availability and high prices of natural gas: Big steel companies would be interested
in setting up gas-based DRI plants as they have lower emissions but natural gas pipelines are not
available in many parts of the country where these plants are located.The high price of natural gas is
another reason that makes it a not-so-preferred option.
4. High demand for primary steel: Many major steel consuming sectors are very particular about
the quality of steel they are buying and prefer primary steel products over secondary steel products.
Sectors like automobile are major primary steel consumers,thus increasing its demand, and since the
gas-based DRI-EAF route has issues and no major steel company wants to invest in coal-based DRI
further on (due to high emissions),the only major option left for them is the BF-BOF route.
30

GHG EMISSIONS
5
FROM INDIA’S STEEL
SECTOR

GHG EMISSIONS FROM INDIA’S
STEEL SECTOR
5.1 TREND IN STEEL EMISSIONS

According to the Biennial Update Reports (bur) submitted by
India to unfccc, iron and steel production contributed some 135
million tonne or 4.75 per cent of the total emissions in India in
2016.
cse has calculated ghg emissions using its estimated emission

factors for different technologies which are based on declarations
and estimations made by the Ministry of Steel and the disclosures
made by steel companies (see Table 6 and Table 7).
According to cse’s estimation, emissions from India’s iron and

steel sector would have been around 250 million tonne in 2016.
The difference in ghg estimations of the iron and steel sector

between moef&cc and cse could be because in the Biennial
Update Reports the energy usage—for power requirements and
for manufacturing in various sectors—has been accounted for
differently. In this case, part of the ghg emissions from the iron
and steel sector are accounted under energy usage and not the
industry, as per the guidelines of IPCC.
Table 6: GHG emissions reported in BUR and estimated by CSE

Year Production (in GHG emissions Estimated GHG Estimated GHG Total estimated GHG
million tonne) reported in emissions from the emissions from the EAF/ emissions as per CSE
BUR (million BF-BOF route as per IF route as per CSE (million tonne)
tonne) CSE (million tonne) (million tonne)
2010–11 70.67 95.99 79.50 103.52 183.02
2011–12 74.29 119.84 78.00 116.71 194.72
2014–15 88.98 154.67 93.42 147.81 241.24
2016 95.48 135.42 102.64 150.92 253.56
Source: Estimated by Centre for Science and Environment, basic data from all three biennial reports submitted to UNFCCC by India and annual reports
of Ministry of Steel
32

Table 7: Estimated range of CO2e emissions from major iron and steel manufacturing
technologies and their scenario in India
S. no. Major iron and steel Estimated range of CO2e Scenario in India Average emission
production technologies emissions (in tonne) factors considered
per tonne of crude steel
production
1. BF-BOF 2.2–2.6 - Due to their large capacities, they hold 2.5

almost half of India’s production share
(45 per cent).
- A majority of India’s future capacity

expansion is planned to happen via this
technology.
2. Coal-based DRI-EAF/IF 2.8–3.2 - Around 82 per cent of DRI production 3
in India is through coal-based rotary
kilns. These are mostly small-scale
units with high CO2e emissions.
3. Gas-based DRI-EAF 1.4–1.8 - Around 18 per cent of DRI production 1.6
in India is gas-based and its share has
not increased much in the past five
years due to non-availability and high
prices of natural gas.
4. Coal gasification-based 2.8–3 - Only one plant of JSPL in Angul, 2.9
DRI-EAF/EOF Odisha. It uses synthetic gas as
produced from gasification of domestic
coal for reduction of iron ore, thus
preventing use of coke (which is scarce
in India) and mostly imported.
5. 100 per cent scrap-based 0.4–0.8 - It is not happening on the ground in 0.6
EAF and IF India. Most EAF and IF plants use a
combination of scrap and DRI (as scrap
availability is an issue).
6. Corex-oxygen converter 2.4–2.8 - This technology is currently in 2.6
(basic oxygen furnace/ use at the JSW Vijayanagar plant
Conarc technology) in Karnataka and Arcellor Mittal
Nipon Hazira plant in Gujrat. Conarc
technology has both an oxygen
converter as well as an electric arc
furnace.
7. BF-EOF (Blast Furnace- 2.5 - Salem Steel Works plant of JSW is 2.5
Energy Optimization known to be using this technology
Furnace) currently. It ends up generating CO2e
emissions almost equivalent to BF-BOF
technology.
Source: Based on declarations by Ministry of Steel, sustainability reports of steel companies in India and research articles (see Annexure)
33

STEEL SECTOR
5.2 TYPE OF PRODUCTION AND EMISSIONS

It is understood that the carbon intensity of steel is determined
by the process through which finished steel is produced from iron
ore and, of course, the fuel used in the manufacture of the product.
The blast furnace-basic oxygen furnace (bf-bof) technology uses

coking coal in its process, not just as a fuel but also as a reducing
agent. Doing so makes the technology more polluting than direct
reduced iron technology (dri), which uses electric arc furnaces
(eaf) to convert iron into steel (dri-eaf).
Globally, it is understood that the bf-bof route is more polluting

and much more difficult to decarbonize than the dri-eaf route.
However, this is not the case in India. The bulk of dri units in
India (responsible for 82 per cent of the country’s dri production)
are in the small- and medium-scale sector and they use coal-
based rotary kilns to produce iron. dri is not only used as a raw
material in eaf, but often also in induction furnaces that produced
as much as 30 per cent of the steel in the country in 2020.
To estimate the emissions intensity of the sector, cse has

examined the annual sustainability reports of companies; and
consulted the company and government declared emissions
intensity factors and sources of the sector (see Annexure). It
is clear that there is a wide variation in the emission factors
between different companies, plants, technologies and sources.
Therefore, a range has been taken based on different sources of
information.
Data shows that coal-based dri-eaf and induction furnace

technologies have higher co2e emissions and gas-based dri-eaf
has lower co2e emissions.
The current emission factor of the bf-bof route in India is close

to the 2030 emissions target set out in the National Steel Policy,
2017. As per the policy, emissions through bf-bof technology
34

would be 2.2–2.4 tonne per tonne of crude steel produced in 2030.
Currently, as per information available from the Ministry of Steel,
the emissions are 2.5 tonne per tonne of crude steel production.
However, as the bulk of future expansion is also planned through

this technological route, it will be critical to see what is possible
for an accelerated low-carbon trajectory for the bf-bof route.
5.3 CURRENT OVERALL EMISSIONS

cse has calculated the emissions of the iron and steel sector based
on voluntary disclosures by the companies and the government.
Where company data is not available, estimated emission factors
for the technology and production figures have been applied.
Where plant-wise production data was unavailable, cse has used
the country average capacity utilization for the plant.
Table 8: Company and plant-wise capacity, production, technology and estimated
GHG emissions ( 2020–21)
S. Company Production Production Iron-making Steel-making Average emission Emission GHG
no. capacity 2020–21 technology technology factor (assumed, factor emissions
2020–21 (million as it is not declared (million
(million tonne) declared by by the tonne)
tonne) company) company
Tata Steel 19.4 16.92 2.3 38.92

(India) Ltd
1 Jamshedpur 11 9.59 Blast Basic Oxygen 2.29 21.96

Plant, Furnace Furnace
Jharkhand
2 Kalinganagar 3 2.62 Blast Basic Oxygen 2.44 6.38

Plant, Odisha Furnace Furnace
3 Dhenkanal 5.6 4.88 Blast Basic Oxygen 2.54 12.21

Plant, Odisha Furnace Furnace
Steel Authority 19.6 15.05* 2.4 38.23

of India Ltd
1 Bhilai Steel 6 4.24 Blast Basic Oxygen 2.5 10.6

Plant Furnace Furnace
2 Durgapur Steel 2.2 2.08 Blast Basic Oxygen 2.5 5.25

3 Rourkela Steel 3.8 3.49 Blast Basic Oxygen 2.5 8.73

4 Bokaro Steel 4.6 3.38 Blast Basic Oxygen 2.5 8.45

35

STEEL SECTOR

5 IISCO Steel 2.5 1.84 Blast Basic Oxygen 2.5 4.6

Plant, Asansol Furnace Furnace
Rashtriya Ispat 6.3 4.3 2.5 10.75

Nigam Ltd
1 Vizag Steel 6.3 4.3 Blast Basic Oxygen 2.5 10.75

JSW Steel 18 15.08 2.49 37.54
1 Dolvi Plant, 5 4.19 Blast Conarc BF-Conarc: 2.5 9.34

Maharashtra. furnace: Technology
3.5 MT Midrex gas DRI-
Conarc: 1.6
Midrex gas
DRI: 1.5 MT Average for
plant based on
technology: 2.23
2 Vijayanagar 12 10.05 Blast Basic Oxygen BF-BOF: 2.5 24.4

Plant, Furnace: Furnace: 11 MT
9.7 MT Corex-BOF: 2.6
Karnataka.
Corex Electric Arc Midrex DRI-EAF:
gasification: 1.6
Furnace: 1 MT
1.6 MT
Average for
plant based on
Midrex gas
technology: 2.43
DRI: 1.2 MT
3 Salem Works, 1 0.84 Blast Energy 2.5** 2.1

Tamil Nadu Furnace Optimization
Furnace
ArcelorMittal 10 6.69 1.92 12.86

Nippon Steel
India
1 Hazira Plant, 10 6.69 Blast Conarc BF-Conarc: 2.5 12.86

Gujarat Furnace: Technology
1.75 MT Corex-Conarc: 2.6
Midrex gas Midrex gas DRI-

DRI: 6.75 MT Conarc: 1.6
Corex Average for

plant based on
technology:
technology: 1.92
1.75 MT
Jindal Steel 8.6 6.859 2.62 18

and Power Ltd
36

1 Angul Plant, 5 3.98 Blast Basic Oxygen BF-BOF: 2.5 10.52

Odisha Furnace: 3.2 Furnace: 3.2 Coal gasification-
MT based DRI-EAF:
MT 2.9
Coal
gasification- Average for
Electric Arc plant based on
based DRI:
Furnace: 1.8 technology: 2.64
1.8 MT
MT
2 Raigarh Plant, 3.6 2.87 Blast Electric Arc BF-EAF: 2.5 7.48
Chhattisgarh furnace: Furnace: 3.6 Coal-based DRI-
3.05 MT EAF: 2.85***
MT
Coal-based Average for
DRI: 1.32 MT plant based on
technology: 2.6
ESL Steel 1.5 1.05 2.5 2.62

Limited-
Vedanta
1 Bokaro Plant, 1.5 1.05 Blast Basic Oxygen 2.5 2.63

Jharkhand Furnace Furnace
Other 60.51 37.6 Assumed Assumed 3 112.79

manufacturers to be coal- that all the
based DRI
(mostly small- rest of steel
scale) manufacturing
is from coal-
based DRI-
EAF/IF
Total 143.91 103.545 271.04 ~

271
*SAIL crude steel production is a sum of production from 5 integrated steel plants of SAIL, excluding production data of Salem Steel Plant and Alloy
Steel Plant as they are not integrated steel plants producing crude steel
** The emission factor for the Salem Works (plant of JSW Steel) has been taken as 2.5, as the blast furnace and coke oven plant are the major emitters,
so energy optimizing furnace’s emissions will not differ much from that of a BOF.
*** In Raigarh plant the emission factor for BF-EAF route has been taken as 2.5 (same as BF-BOF) because the hot metal from blast furnace when put into
the electric arc furnace needs to go through oxygen lancing process, making it equivalent to emissions from BF-BOF. The emission factor for coal-based DRI-
EAF has been taken to be 2.85 (instead of 3 i.e. CSE's estimated factor) as in this case the hot DRI gets mixed with high carbon hot metal from blast furnace
while being fed into electric arc furnace, which leads to lesser electricty consumption in the furnace. Also in rotary kilns of above 300 tonne capacity, a waste
heat recovery system is usually present which is used to generate electricity that is then used in the electric arc furnace. Therefore, these two reasons bring
down the emission factor, which then has been assumed to be 2.85.
Important notes about Table 8:
• The GHG emissions mentioned for the overall company and the sum of its plants might differ as overall average company emission factors (self-
declared or estimated) have been considered for calculating company GHG emissions whereas technology specific (see Table 7) or self-declared
emission factors have been considered plant-wise.
• Some numbers may not match exactly due to rounding off.
• Figures marked in red under the production column show the production figures that have been estimated based on the unit’s share in overall
production capacity when the total company production is known, or based on country's capacity utilization share (70 per cent) if company's total
production is not known (eg: ESL Steel) or share of production apart from the 7 steel companies in India (eg: Other manufacturers).
• Total GHG emissions are a total of plant-wise GHG emissions along with the other manufacturer category
Source: Estimations and calculations by CSE, Joint Plant Committee, declarations sourced from company websites and sustainability reports, and
Ministry of Steel
37

STEEL SECTOR
In terms of companies, Tata Steel (India) Ltd, SAIL and Jindal

Steel Works are the largest individual contributors to ghg
emissions from the sector (being the largest steel producers)
in India. However, the small- and medium-scale steel
manufacturing units using coal-based dri remain the major
contributors and also highest in terms of their specific emissions.
Table 9: Company-wise capacity, production, technology and estimated GHG emissions in

2020–21
S. Company Production Production Iron-making Steel-making Average Emission GHG
no. capacity 2020–21 technology technology emission factor emissions
2020–21 (million factor declared (million
(million tonne) (assumed, as by the tonne)
tonne) not declared company
by the
company)
1. Tata Steel (India) 19.4 16.9 Blast Furnace Basic Oxygen Furnace 2.3 38.92
Ltd
2. Steel Authority of 19.6 15.05* Blast Furnace Basic Oxygen Furnace 2.54 38.23
India Lts
3. Rashtriya Ispat 6.3 4.3 Blast Furnace Basic Oxygen Furnace 2.5 10.75
Nigam Lts
4. JSW Steel 18 15.08 Blast Furnace, Conarc Technology, 2.49 37.54

Midrex and Corex Basic Oxygen
technology Furnace, Electric Arc
Furnace and Energy
Optimization Furnace
5. ArcelorMittal 10 6.69 Blast Furnace, Conarc Technology 1.92 12.86

Nipon Steel India Midrex and Corex
technology
6. Jindal Steel and 9.6 6.859 Blast Furnace, Basic Oxygen Furnace 2.62 18
Power Ltd coal gasification- and Electric arc furnace
based DRI and
Coal based DRI
technology
7. ESL Steel Limited 1.5 1.05 Blast Furnace Basic Oxygen Furnace 2.5 2.63
- Vedanta
8. Other 60.51 37.6 Assumed to be Assumed that all 3 112.79

manufacturers coal-based DRI the rest of steel
(mostly small/ manufacturing is from
medium-scale) coal-based DRI-EAF/IF
Total 143.91 103.545 271.72**

~271
*SAIL crude steel production is a sum of production from 5 integrated steel plants of SAIL, excluding production data of Salem Steel Plant and Alloy
Steel Plant as they are not integrated steel plants producing crude steel
** Total GHG emissions are a total of company-wise GHG emissions, including emissions from the other manufacturer category
Source: Estimations and calculations by CSE, Joint Plant Committee, declarations sourced from company websites and sustainability reports and
Ministry of Steel
38

After looking at the company-wise ghg emissions, it is essential
to understand the technology-wise share of ghg emissions in the
year 2020. As per this analysis, bf-bof and the coal-based dri-eaf
compete in terms of production share in steel manufacture in the
country—both routes with 45 per cent of the total production.
Table 10: Technology-wise production, emission factors and GHG emissions in 2020–21
Technology Production in 2020–21 Percentage share of Average emission GHG emission in 2020–
(million tonne)* total production factor 21 (million tonne)
BF-BOF 46.6 45 2.5 116.49
Gas-based DRI-EAF 10.44 10 1.6 16.7
Coal based DRI-EAF/IF 46.51 45 3 139.51
Total 103.54 272.7
Source: Estimations and calculations by CSE, production sourced from Ministry of Steel
*The technology share for 2020–21 has been assumed the same as given for the year 2020 in the Annual Report 2020–21 by Ministry of Steel
But in terms of ghg emissions, the dri-eaf route is more polluting.

Its average emission factor is 3 tonne of co2e per tonne of steel and
so it produces over half the emissions from the sector.
39

FUTURE
6
EMISSIONS: 2030
40

Indian steel sector’s emissions profile in 2030 will depend
on factors like sectoral targets, fuel switch and technology
upgradation. We have estimated emissions in four different
scenarios by varying and changing these factors.
According to the 2019 Steel Scrap Recycling Policy, 35–40 per

cent of the production capacity (of 300 million tonne per year)
and production (of 255 million tonne per year) envisaged for 2030
will be based on the electric arc furnace and induction furnace
method—this has been considered for all scenarios. Currently, the
eaf/if method is used to produce 55 per cent of the crude steel in
the country and it is highly polluting because of the use of coal-
based rotary kilns.
Firstly, we have estimated the business-as-usual (bau) scenario.

It takes the estimated production growth and technology share
for 2030 into account but at current emission factors.
Secondly, we have estimated a scenario which assumes the

ability of the steel industry to meet the targets set by the National
Steel Policy of 2017 for emissions reduction. This is the low-
carbon growth pathway for 2030.
This scenario also takes into consideration the current estimated

production growth and technology share for 2030 as proposed
in the National Steel Policy of 2017. Although within 35 per cent
share of dri-eaf/if, the share of gas-based steel production has
been assumed to increase to 15 per cent share of steel production.
Thirdly, a scenario has been estimated in which the voluntary

carbon intensity targets of large steel companies are achieved,
further improving the low-carbon growth pathway. This is the
improved low-carbon growth pathway for 2030. The assumed
increment in gas-based dri-eaf steel production to 15 per cent is
estimated in this scenario as well.

FUTURE EMISSIONS: 2030
Fourthly, there is another scenario that demonstrates even

more improvement in the sector. This is the CSE recommended
accelerated low-carbon growth pathway for the Indian steel
sector for 2030 (see Chapter 8).
6.1 BUSINESS-AS-USUAL SCENARIO

In the bau scenario, co2e emissions projections have been made
based on the assumption that the pattern of production will not
change and the production figures will be as projected in the
National Steel Policy of 2017, i.e., 255 MT of crude steel production
annually by 2030.
It is also assumed, based on the expansion plans of major steel

companies, that the share of bf-bof in total steel production will
be at least 65 per cent (up from the current 45 per cent), while
leaving the rest of the share to eaf and if. The emission factors
considered in this scenario would be the same as for 2020–21.
Table 11: GHG emissions in a business-as-usual scenario for 2030
Technology Production in GHG emissions Estimated Emission factor GHG emissionsin
2020–21 in 2020–21 production in 2030 considered for 2030 2030 in a BAU
(million tonne) (million tonne) (million tonne) in a BAU scenario scenario
(million tonne)
BF-BOF 46.60 116.49 165.75 2.5 414.37
Gas-based DRI-EAF 10.44 16.7 16.35 1.6 26.17
Coal-based DRI-EAF/IF 46.51 139.51 72.88 3 218.64

Total 103.55 272.7 255 659.19
Graph 6: GHG emissions in 2020 and 2030 in a business-as-usual scenario by technology

700 659.19
GHG emissions (in million tonne)
GHG emissions in 2020-21 GHG emissions in 2030 in BAU scenario

600
500
414.37
400
300 272.7
218.64
200 139.51
116.49
100
16.7 26.17
0
BF-BOF Gas based DRI-EAF Coal based DRI-EAF/IF Total GHG emissions
Technology
42

The bau scenario shows almost 2.5 times increase in the overall
ghg emissions from the sector compared to emissions in 2020–21.
It also shows almost 3.5 times rise in ghg emissions from the
bf-bof route and around 1.6 times increase in ghg emissions
from the coal-based dri-eaf route. This clearly shows that
decarbonization of the bf-bof route is the priority followed by the
decarbonization of coal-based dri-eaf route.
6.2 LOW-CARBON GROWTH PATHWAY

This scenario presents a picture of ghg emissions in 2030 if the
steel sector succeeds in achieving the emissions targets set by the
government for the different production routes in the National
Steel Policy of 2017. The policy aims to reduce greenhouse gas
emissions to about 2.2–2.4 tonne of co2 per tonne of crude steel
produced through the bf-bof route and 2.6–2.7 tonne of co2 per
tonne of crude steel produced through the dri-eaf route by 2030.
Since the National Steel Policy does not mention separate targets
for coal-based dri-eaf/if production route and the gas-based dri-
eaf route, to keep the estimate more realistic we have assumed
in this scenario that the share of gas-based dri steel production
would rise to 15 per cent of the total production by 2030. The
emission factor in this case has been taken as 1.6 tonne of
emissions per tonne of steel production.
The National Steel Policy states that for the bf-bof route,
emissions will be 2.2–2.4 tonne per tonne of steel production,
marginally lower than the current bf-bof route emissions. The
estimated production figures and the share of technology (65 per
cent bf-bof and 35 per cent dri-eaf/if) is considered as provided
in the National Steel Policy of 2017 (see Table 12).
In the low-carbon growth pathway (based on the National Steel

Policy of 2017), the reduction will be equal to 82 million tonne
over the bau scenario—a decrease of 12.5 per cent. This is not
very high and this is because of the following reasons:
43

Table 12: GHG emissions in a low-carbon growth pathway for 2030 (as per National Steel
Policy 2017)
Technology Production in GHG emissions Production in Emission factor GHG emissions in 2030
2020–21 in 2020–21 2030 (million considered for 2030 in in the low carbon
(million tonne) (million tonne) tonne) the low-carbon scenario scenario (million tonne)
BF-BOF 46.60 116.49 165.75 2.3 381.22
Gas-based DRI-EAF 10.44 16.7 38.25 1.6 61.2
Coal-based DRI-EAF/IF 46.51 139.51 51 2.65 135
Total 103.55 272.7 255 577.57
Graph 7: GHG emissions in 2020 and on a low-carbon growth pathway for 2030 (as per
National Steel Policy 2030)
700
GHG emissions in 2020-21 GHG emissions in 2030 in the low-carbon scenario
577.57
600
500
381.22
400
300 272.7
200 139.51
116.49 135
100 61.2
16.7
0
BF-BOF Gas-based DRI-EAF Coal-based DRI-EAF/IF Total GHG emissions
Technology
a. Currently, bf-bof technology contributes roughly 45 per cent to

the steel mix in the country. It is assumed that this will go up
to 65 per cent by 2030. In this way, ghg emissions from the bf-
bof route will increase by 3.2 times as compared to 2020–21.
b. The emission factors considered for dri-eaf are higher
than global averages and this is partly because the sector
continues to be based on coal and there is no clear target for
increased usage of recycled material in this scenario. Globally,
steel manufacture from dri-eaf is preferred for emissions
reduction, as it can be based on gas and it can use higher
proportion of recycled material.
44

6.3 IMPROVED LOW-CARBON GROWTH PATHWAY
FOR 2030
Indian steel industry has set voluntary targets for emissions
reduction (see Table 13).
The improved low-carbon pathway for 2030 presents a scenario

of ghg emissions if voluntary targets of large steel companies are
achieved by that year.
In this scenario, it has also been assumed that the share of gas-
based dri would be up by 15 per cent by 2030.
Company-wise production for calculations is based on their future

expansion plans but under the overall cap of 255 MT national
production.
The emission factors considered for the bf-bof route are the ones
declared as voluntary targets by large companies (see Table 13). The
emission factors for the estimated gas-based dri production have
been taken from cse’s estimated emission factors (see Table 7).
In this improved low-carbon pathway (based on voluntary

targets for large steel companies) the reduction will equal to 148
million tonne over the bau scenario—22.5 per cent reduction by
2030.
The estimates in this scenario show a further decrease in ghg

emissions compared to the reduction achieved under the second
scenario which was based on National Steel Policy targets. This
improvement is a result of higher targets set by Tata Steel (India)
Ltd and jsw Steel, which are two of the largest steel producers in
the country.
It is significant to mention here that the production from these

large steel companies is estimated to grow from around 66
million tonne to around 200 million tonne by 2030.
45

Table 13: Current emissions and decarbonization targets set by India’s major steel
producers
S. no. Steel Current emissions intensity Target Target considered
producer for emissions
calculation (tonne
of CO2e or CO2
emissions per tonne
of crude steel)
1. Tata Steel - Current emissions intensity is 2.31 tCO2e - Aims to achieve emissions intensity 1.79
(India) Ltd per tonne of crude steel produced. Tata < 2 tCO2e per tonne of crude steel
Steel Jamshedpur has an emissions produced by 2025 and < 1.8 tCO2e
intensity of 2.29 tCO2e per tonne of per tonne of crude steel produced by
crude steel produced and Tata Steel 203018,19
Kalinganagar has an emissions intensity
of 2.44 tCO2e per tonne of crude steel
produced16,17
2. JSW Steel - Current GHG emissions intensity is - Committed to reducing specific GHG 1.94
2.49 tCO2e per tonne of crude steel emissions from the three integrated
produced20 steel plants to < 1.95 tCO2e per tonne
of crude steel produced by 203021
- Target to achieve carbon neutrality
at JSW Steel Coated Products Ltd by
203022
3. Arcelor - Not declared - Group targets to bring 30 per cent 1.82
Mittal - 1.82 assumed as 30 per cent reduction reduction in its CO2 emissions over
Nippon from 2018 level (which has been taken the 2018 level by 203023
Steel (AM/ as 2.6, as the official emission factor for - Planning to be net zero by 205024
NS) India 2015 was 2.65) - Planning to build world’s first full-
Ltd scale zero-carbon emissions steel
plant in Sestao, Spain by 2025
4. SAIL - 2.54 tCO2e emissions per tonne of crude - No target specified, assuming they 2.3
steel produced as of 2019–202125 are following the target set in the
National Steel Policy, 2017, i.e.,
2.2–2.4 tCO2 emissions per tonne
through the BF-BOF route
5. JSPL - Across all operations (which include - No specific CO2 emissions reduction 2.3
steel production and power generation), target found on their website and in
they generated 32.3 MtCO2 in 2019–20 their annual reports
- Hence, 2.3 tCO2e emissions per
tonne of crude steel considered
(country target)
6. RINL - Not declared - No target specified, assuming they 2.3
are following the target set in the
National Steel Policy, 2017, i.e.,
2.2–2.4 tCO2 emissions per tonne
through the BF-BOF route
- Hence, 2.3 tCO2e emissions per tonne
of crude steel considered (country
target)
46

S. no. Steel Current emissions intensity Target Target considered
producer for emissions
calculation (tonne
of CO2e or CO2
emissions per tonne
of crude steel)
7. ESL Steel - Not declared - No exact target figure declared. 2.3
Only mention achieving substantial
decarbonization by 2050
- Hence, 2.3 tCO2e emissions per
tonne of crude steel considered
(country target)
Source: Annual and Sustainability Reports of Steel Companies
Table 14: GHG emissions in an improved low-carbon growth pathway for 2030 (based on
voluntary targets by large steel companies)
Technology Production in GHG emissions in Production in Emission factor for GHG emissions in
2020–21 2020–21 (million 2030 (million 2030 in the improved 2030 in the improved
(million tonne) tonne) low-carbon scenario low-carbon scenario
tonne) (million tonne)
BF-BOF 46.60 116.49 165.75 Company-wise 315
emissions targets (see
Table 13)
Gas-based DRI-EAF 10.44 16.7 38.30 1.6 61.29
Coal-based DRI-EAF 46.51 139.51 50.94 2.65 135
Total 103.54 272.7 255 511.25
Graph 8: GHG emissions in 2020–21 and in an improved low-carbon growth pathway for
2030 by technology, (based on voluntary targets by large steel companies)
600
511.25
500
400
315
300 272.7
200
139.51 134.99
116.49
100 61.29
16.7
0
BF-BOF Gas-based DRI-EAF Coal-based DRI-EAF/IF Total GHG emissions
Technology
GHG emissions in 2020-21 GHG emissions in the improved low-carbon scenario in 2030
47

PATHWAYS
7
FOR CARBON
INTENSITY
REDUCTION IN THE
STEEL SECTOR
48

The iron and steel sector needs a clear trajectory for emission
reduction, beyond even the best case scenario—the improved
low-carbon scenario. To understand the possibilities, we have
mapped out the technology options for reduction of emissions in
this sector.
7.1 SECTOR-WIDE IMPROVEMENTS

Certain measures or parts of them can be applicable to all
production technology routes throughout the steel sector to
reduce emissions. Some of these pathways have been discussed
in this section.
7.1.1 TECHNOLOGIES FOR EMISSIONS AND

RESOURCE-INTENSITY REDUCTION
A number of technologies can help reduce carbon emissions from
steel plants and the Ministry of Steel has also compiled a list of
such technologies.
This list is as follows:

• Coke dry quenching (cdq): Power generation from waste heat
from cdq
• Sinter plant heat recovery (power generation from sinter
cooler waste heat)
• Bell-less top equipment (blt) in blast furnace
• Top pressure recovery turbine (trt) in blast furnace
• Pulverized coal injection (pci) system in blast furnace
• Hot stove waste heat recovery in blast furnace
• Dry type gas cleaning plant (gcp) in blast furnace
• Cast house or stock-house de-dusting system
• Converter gas recovery in bof
• Energy monitoring and management system
• Secondary fume extraction system in steel melting shop
• Regenerative burners in re-heating furnaces of rolling mills
• Hot charging process of continuously cast products at higher
temperature directly to rolling mills
• Direct rolling process eliminating the need for re-heating
furnaces
49

PATHWAYS FOR CARBON INTENSITY
REDUCTION IN THE STEEL SECTOR
• Energy efficient technology for hot strip mill: Flexible thin slab
casting and rolling
• Near net shape casting: Bloom-cum-beam blank caster,
bloom-cum-round caster, etc.
• Adoption of variable voltage variable frequency (vvvf) drives
for high capacity electric motors26
Ministry of Steel claims that the reduction in co2e emissions

from the iron and steel sector between 2014 and 2016 is a result of
implementation of these technologies on ground.
The Ministry should share a list of plants with a checklist of

technologies implemented at each of them in the public domain
so that the claims can be verified independently.
7.1.2 INCREASING AVAILABILITY OF CLEANER FUEL

FOR COMBUSTION
Cleaner fuels like natural gas are still unavailable in many
regions of the country. If we look at the gas infrastructure map
of India, we can see that large parts of the eastern states, which
are a natural source of iron ore and hub of steel production,
lack access to natural gas (this can be seen through the smaller
number of green coloured districts in eastern India which shows
the districts with existing gas infrastructure) (see Map 2).
Because of their high prices, cleaner fuels like hydrogen are still
far from becoming popular on the ground. The issue with natural
gas is not just lack of availability but the continuously increasing
price compared to dirty fuels like coal.
7.1.3 INCREASING AVAILABILITY AND SETTING

TARGETS FOR USE OF STEEL SCRAP
The use of every tonne of steel scrap to produce steel saves 1.1
tonne of iron ore, 630 kg of coking coal and 55 kg of limestone.
The specific energy consumption is also reduced by 14 MJ/kg in
the bf-bof route and 11 MJ/kg in the eaf and if route, i.e., a saving
of 16–17 per cent energy. Use of steel scrap in steel production can
50

Map 2: Gas infrastructure in India in 2021
Source: Petroleum and Natural Gas Regulatory Board, 2021
51

Figure 7: The cycle of steel recycling
Scrap
generation
1
Coal DRI/sponge Secondary steel

iron giants sector plants
EAF/IF route
Steel production
Iron ore integrated steel
plantsn BF-BOF Steel products
Coking coal route
1 Directly Processed Processed

Fabrication of
used e.g., rails and scrap scrap
Scrap steel items
structurals
generation 2
Scrap Scrap
1 Home scrap generation processing
Lifecycle Scrap
2 New/prompt scrap completion processing
3 Obsolete scrap
3 Scrap
collection
Obsolete
scrap
Source: Steel Scrap Recycling Policy, 2019, page 9, Ministry of Steel
reduce water consumption by 40 per cent and GHG emissions by

58 per cent.
Steel scrap is the major raw material for eaf and if units and it
can also be used in basic oxygen furnaces (in up to 30 per cent
proportion) to improve efficiency, minimize cost of production
and for other processing needs. The cycle of usage and generation
of steel scrap has been shown in Figure 7.
According to the Steel Scrap Recycling Policy, 2019 issued by

the Ministry of Steel, India generates 25 million tonne of steel
scrap and imports around 7 million tonne of scrap every year
and through this steel scrap recycling policy, the country wants
to close this gap. The World Steel Association estimates that
the global ferrous availability stood at 750 million tonne in 2017
and the availability is expected to reach 1 billion tonne in 2030
52

and 1.3 billion tonne in 2050, growing by more than 500 million
tonne within the next 30 years.27 The Steel Scrap Policy of 2019
envisages a share of 35–40 per cent scrap use in steel production
by 2030. It further mentions that achieving this share shall
increase the requirement of steel scrap from around the current
30 million tonne to more than 70 million tonne by 2030. Steel
Recycling Business, Tata Steel says that the demand for scrap
in India is around 30–32 million tonne (as of 2020) and it is
expected to grow at 7 per cent per year to reach 40 million tonne
by 2025 and around 70 million tonne by 2030, which matches
the estimates in the Steel Scrap Policy, 2019.28 However, there is
scope of generating as well as using much more scrap for steel
production in the country. Therefore, the steel scrap policy needs
to ensure that it sets a high scrap generation target that enables
the country to meet the estimated demand and beyond, and
along with this it should also set targets for steel companies for
utilization of scrap in the production of steel.
RISING POTENTIAL OF SCRAP FROM SHIP RECYCLING INDUSTRY IN

INDIA
India’s ship recycling industry is growing by the day. It is already catering to 1–2 per cent of the current
domestic steel demand of the country and around 28 per cent of the country’s total exported ferrous scrap.
The Finance Minister, in her 2021–22 budget speech, mentioned that the potential of this sector will be
doubled by 2024 and attract more end-of-life vessels from Europe and Japan.
India also has the world’s largest ship recycling operation—the Alang-Sosiya ship recycling yards—situated
on the west coast of Gujarat. Alang has around 120 ship recycling yards dismantling ships to extract various
types of scrap for recycling and reuse.These yards are responsible for 47 per cent of all ships being recycled
globally which makes India one of the biggest hubs of ship recycling. The facility started in 1982 and has
increased its recycling capacity by more than 100 times since then. More than 350 ships are currently being
recycled every year in Alang-Sosiya.
Seeing the past and future potential of growth in this industry, ship recycling could be a major source of
scrap generation and availability for the steel sector of the country. The need of the hour is a well-defined
policy or regulation for the industry to achieve this goal.29
53

The establishment of scrap processing centres and shredders in

the right number as proposed in the Steel Scrap Policy, 2019, can
mark an increase in the quantity of high-grade steel scrap which
can act as a suitable raw material for not only the eaf-if route but
also help increase usage of scrap in the bf-bof route. Availability
of high-grade steel scrap will automatically lead to production of
high-grade steel through the eaf and if routes.30
7.1.4 CARBON CAPTURE, UTILIZATION AND

STORAGE
Implementation of carbon capture, utilization and storage
(ccus) in steel plants of India is largely dependent on how the
high costs involved will be met. Big players of the sector like
Tata Steel (India) Ltd, jsw Steel and sail have already started
(or are about to start) carbon capture and utilization initiatives
at a small-scale. jsw Steel is already doing ccu at its dri plant
in Sarav, Maharashtra and sail is planning to build a carbon
SOME INITIATIVES OF CARBON CAPTURE AND UTILIZATION BY STEEL

PLANTS IN INDIA
1. JSW Steel carbon capture and The DRI plant with carbon capture at Salav, Maharashtra
utilization at the DRI Plant at
Salav, Maharashtra: In the direct
reduced iron reduction process, CO
and H2 are passed through iron ore
pellets and lump-ore to facilitate the
process of reduction. Waste gas that is
rich in carbon is recovered and sent to
absorbers that treat it counter-current
with Giammarco Vetro (G.V.) coke
solution forming a rich solution. G.V. and
CO2 get separated due to treatment of
the rich solution in regenerators.CO2
recovery and production capacity of this
unit is 100 TPD.CO2 is then captured,
stored and transported for usage in food
Source: Jindal Steelworks 32
and beverage industry.31
54

2. SAIL is planning to install India’s first gas-to-ethanol plant at Chandrapur: With
the help of the Central government,SAIL is planning to set up India’s first gas-to-ethanol plant at its ferro-
alloy unit in Chandrapur. This will be the fourth plant of its kind in the world.Currently,this technology is
in use at two plants in China and at an Arcellor Mittal plant in Belgium.The technology will help reduce
dependence on imported crude oil on one hand and reduce carbon emissions on the other hand.Steel
Research and Technology Mission of India is helping SAIL set up the plant.The project cost is estimated
to be Rs 400 crore,of which 20 per cent funding will be provided by the Central government under the
National Policy on Bio-fuels, 2018.
The plant will capture hot gases like CO2,CO and H2 that are emitted from the ferro-alloy plant’s
submerged arc furnace and convert them into ethanol using fermentation technology.There is scope of
producing 50,000 litres of ethanol per day from about 10,000 normal metre cube (NMC) per hour gas
produced at Chandrapur.33
3. Carbon capture and utilization (CCU) unit at Tata Steel,Jamshedpur: Tata Steel
commissioned a 5 tonne per day carbon capture plant at its Jamshedpur unit in September 2021.
Tata Steel claims it to be the country’s first carbon capture technology plant that captures CO2 from
blast furnace gas.It is a step towards promoting circular carbon economy. The CCU facility uses amine-
based technology and makes captured carbon available for on-site use.Depleted CO2 gas is sent back
to the gas network with increased calorific value.The captured CO2 is used for water treatment at a
steel-making unit.Carbon Clean (a manufacturer of low-cost CO2 capture technologies) has provided
technological support for the execution of this project.
A CCU unit at Tata Steel’s Jamshedpur plant
Source: Tata Steel34
55

capture unit that will produce ethanol at its Chandrapur plant.

They are planning the same at two other plants as well. Tata Steel
(India) Ltd has established pilot projects for carbon capture at its
Jamshedpur plant and also at one of its ferro-chrome plant35 (see
Box: Some initiatives of carbon capture and utilization by steel
plants in India).
Carbon storage capacity is one of the key challenges in this

strategy. Tata Steel Europe has started a permit process at its
Ijmuiden plant in the Netherlands for installation of carbon
capture infrastructure which is linked with a pipeline to transport
co2 to be stored under the North Sea in empty gas fields, 50
kilometres from the coast. By capturing and storing co2, the Tata
Plant in Ijmuiden, Netherlands plans to reduce its emissions by
40 per cent by 2030.36
Such kind of storage solutions need to be explored in India as

well, though it seems challenging due to the distance between the
location of a majority of steel plants in India (mostly in Central
and Eastern parts of India) and the probable storage options,
which are oilfields (mostly in the western part of India).
7.1.5 HYDROGEN TO REPLACE COAL AND GAS AS A

REDUCING AGENT
With the announcement of the National Hydrogen Mission by
the Prime Minister, with the express aim of making the country a
hub of production and export of green hydrogen, there is renewed
hope. It is expected that after so much talk about hydrogen usage
over the years, its use will soon be a reality in many sectors,
including the iron and steel sector.
It is important to understand that hydrogen can be used in two

ways in the steel-making process.
Firstly, it can be used as an auxiliary reducing agent in the bf-bof

route (h2-bf). Currently, only pulverized coal, natural gas and oil
are used as auxiliary reducing agents and they produce co2 as the
56

byproduct, whereas hydrogen will produce water as a byproduct,
reducing co2 emissions. Due to certain technical reasons, it may
be feasible to use only hydrogen in blast furnaces; therefore it is
looked at more as a transition towards h2-dri.
Secondly, it can be used as the sole reducing agent in the direct

reduction of iron processes (h2-dri).
In Netherlands, Tata Steel is already taking steps to develop a

hydrogen plant at the Ijmuiden site which will produce 100,000
tonne of hydrogen every year.37 Arcelor Mittal is also developing a
new innovation project in Hamburg, Germany which aims to use
dri made with 100 per cent hydrogen as a reducing agent with an
annual production of 100,000 tonne of steel.38
Table 15: Steel plants planning to use H2-BF technology

Steel company Plant location Electrolyzer Renewable
Arcelor Mittal Bremen, Germany Yes Unclear
Arcelor Mittal Dunkirk, France No Not known
Arcelor Mittal Asturias, Spain No Not known
Arcelor Mittal Fos-Sur-Mer, France Yes Yes
Voestalpine Linz, Austria Yes Yes
Thyssenkrup Duisburg, Germany No Not known
Tata Ijmuiden, Netherlands Yes Yes
Dillinger/ Saarstahl Dillingen, Germany No Not known
Source: Bellona.org39
THE COST DYNAMICS OF STEEL PRODUCTION WITH HYDROGEN
Currently,the cost of green hydrogen is around US $3.5–5 per kg.Green hydrogen-based DRI process would
approximately increase the cost of steel production by US $150–250 compared to the cost of gas-based DRI.
To become cost-competitive with gas-based DRI,the price of H2 needs to drop to US $1 per kg in Europe and
US $0.7 per kg in the US.
The highest contributor to green hydrogen cost is the cost of renewable energy.If the cost of renewable
energy continues to drop,it is estimated that cost of hydrogen would drop to US $1.5 per kg by 2030.Even
then,hydrogen initiatives would require financial support as they will still be higher in cost compared to other
carbon-neutral steel making technologies.Although at this cost it will start to be competitive with fossil fuel in
steel making.40
57

Another aspect that needs to be understood is that the process

of production of hydrogen to be used will define the amount
of reduction one can achieve by adopting hydrogen for steel
production. If hydrogen is produced through electrolysis using
renewable energy, it can achieve emissions reduction of around
21 per cent on the bf-bof route.41
The h2-dri route, if using green hydrogen, can achieve up to 95

per cent reduction in co2 emissions. This is one of the cleanest
steel-making routes.42
7.1.6 HISARNA TECHNOLOGY

In 2004, a group of European steel companies, with help from the
European Union, started an ultra-low co2 steel-making (UCLOS)
project. Their objective was to come up with technologies that
will reduce co2 emissions from steel-making by 50 per cent by
2050. HIsarna is one of the technologies developed by them. Its
test installation was done at the Tata Steel site in Netherlands in
2010. By 2018, the installation had become a part of the production
chain and the pilot campaign was successfully concluded in 2019.
This technology reduces co2 emissions by at least 20 per cent.
As the Tata Netherlands plant is also implementing ccs, when
combined with HIsarna, it could reduce co2 emissions by at least
80 per cent.43
HIsarna uses powdered iron ore and powdered coal directly in

the steel-making process, thereby eliminating the processes of
coking and agglomeration (sinter and pellet making, etc.) which
are used to charge the blast furnace in the conventional process.
This cuts down the need for big plants, raw material processing
cost and the co2 emissions from processes like coking, sinter and
pellet making (see Figure 8). This technology is also suitable for
low-grade raw materials.
HIsarna also allows the use of steel scrap and biomass in steel
production. With the use of biomass and steel scrap together in
the best combination (i.e., 45 per cent biomass and 53 per cent
58

Figure 8: Comparison between conventional blast furnace and HIsarna showing how
HIsarna eliminates coking and agglomeration
Conventional blast furnace technology
Iron ore Hot metal
Coal Coking/agglomeration Ironmaking
Iron ore
Hot metal
Direct use of fine ores and coal

(no agglomeration and coking)
Coal
Ironmaking
Source: Presentation by Johan van Boggelen, Operations and Technology Manager at HIsarna Pilot Plant, Netherland, 16 September 2021
steel scrap), up to 50 per cent co2 emissions reduction can be

achieved even without ccs. Through the use of carbon capture in
this combination, one could even achieve negative emissions.
With the addition of a carbon capture unit to a HIsarna plant, co2

goes directly into the liquefaction plant for storage and usage, so
basically, it is a plant without any stack. Therefore, not only has
the plant no co2 emissions but it also emits no sox, nox or pm.
This technology also facilitates zinc recovery from steel scrap as
galvanized steel is used in a lot of steel products like cars. Zinc
scrap is usually downcycled in electric arc furnaces. eaf dust
can contain about 20–35 per cent zinc, which is then upcycled
to extract zinc. Whereas if the content of zinc is less than 20 per
cent, the dust is land-filled.
Regarding costing, this technology has much lower capital

expenditure as the land area required is less, plus coke and sinter
plants are not required. Along with this, it is energy efficient, it
59

can work on low-cost and low-grade raw materials, and it can

use waste oxides and bof slag as well. Hence, it has low capital
expenditure (capex) along with low operating expenditure (opex).
Therefore, HIsarna is a promising technology that can be adopted

by upcoming steel plants in India as it addresses the issue of ghg
emissions, air pollution and material circularity while being a
cost-feasible option. The technology has been in the news for
about a decade but its actual adoption on the ground remains to
be seen.
7.2 LOW CARBON PATHWAY OPTIONS FOR BLAST

FURNACE–BASIC OXYGEN FURNACE ROUTES
As per the Ministry of Steel,44 India has already achieved 2.5
tonne of co2 emissions per tonne of crude steel produced through
the bf-bof route in 2020.
Graph 9: Country-wise comparison of average CO2 emissions from the BF-BOF route
(2020)
BF-BOF CO2 intensity (tonne of CO2 per tonne crude steel)
2.5
1.5
0.5
0
Canada
Spain
Mexico
United States
France
Russia
Japan
Germany
Italy
Brazil
Turkey
South Korea
China
India
Poland
Source: Global Efficiency Intel45
60

Moreover, private steel producers in India, like Tata Steel (India)
Ltd and jsw Steel, have set out to achieve co2e emissions targets
of 2 tonne or less per tonne of crude steel produced by 2030.
Average global co2 emissions from the steel sector were at 1.89
tonne per tonne of crude steel produced in 2020 (as per the World
Steel Association).46 This emission intensity is expected to
decrease further by 2030.
As of 2020, some countries like Canada and Spain had already

achieved an average emission factor of around 1.5 tonne of co2 per
tonne of steel produced through the bf-bof route.
Countries like Mexico, United States, France and Russia have a
country average well below 2 tonne of co2 emissions per tonne of
steel produced (see Graph 9).
This sends a clear message of reconsideration to the Government

of India that has planned its country average emission factor
though the bf-bof route as 2.3 tonne co2e emissions per tonne of
crude steel and also for the top Indian steel companies that are
targeting an emission factor of around 2 tonne co2e emissions
per tonne of crude steel. The whole country average in so many
countries in less than these emission targets. India can, and must,
do more.
• Action 1: Promoting use of alternative fuels and other

reducing agents in blast furnaces: The blast furnace is one
of the most emissions-intensive processes in steel-making
and the reducing agent it uses is coke, of which India has
low reserves. Therefore, the country depends on expensive
imports. To reduce import dependency, energy consumption
and ghg emissions, it is essential that steel plants increase use
of alternative reducing agents like biomass, biochar, natural
gas, hydrogen, waste plastic and fuel oil. The use of these
alternative reducing agents depends on their availability;
therefore, the appropriate reducing agent may differ from
region to region.47
61

7.3 LOW CARBON PATHWAY OPTIONS FOR DRI–EAF

AND INDUCTION FURNACE
The National Steel Policy, 2017 has fixed the emissions reduction
target for the dri-eaf route at 2.6–2.7 tonne of co2 per tonne of
steel. Small-scale coal-based dri production in India makes this
one of the most polluting routes, with emission factors ranging
between 2.8–3.1 tonne of co2 per tonne of steel produced.
In many Western and Middle Eastern countries, dri-eaf is a popular

route for steel making, but through gas-based dri, as gas is easily
available in those countries. Large future expansions are being
planned through this route in these countries. Moreover, scrap is
easily available in these countries, which reduces the dependence
of electric arc furnaces on dri.
Globally, co2 emissions from coal-based dri-eaf are around 1.9

tonne per tonne of steel produced (though the coal-based route is
prominent only in India), whereas co2 emissions for gas-based
dri-eaf are 1.3 tonne per tonne of steel produced.48 This clearly
stands much below the target set by the Government of India in
the National Steel Policy in 2017.
7.3.1 OPTIONS FOR DRI-EAF

The problem with the dri industry in India is that around 82 per
cent of dri is produced in coal-based rotary kilns that have high
levels of emissions. Usually, these coal-based rotary kilns are
small-scale (with around 200 to 500 tonne per day production)
compared to gas-based dri production plants (with a capacity of
around 8,000 tonne per day or more).
Gas-based dri plants use vertical shaft technology in steel making.

This is different from small-scale dri plants that use rotary kiln
technology. This difference in scale, capacity and technology
makes it difficult to push coal-based rotaries to convert to gas-
based dri units. It may not be economically feasible to convert the
whole plant into a much larger facility as that would require large
investments.
62

Therefore, some steps that can be taken for carbon reduction in
coal-based dri-eaf plants of India are:
• Action 1: Use of natural-gas or coal-bed methane injections

in coal-based dri plants: One step could be to introduce
partial or full natural-gas injections in these coal-based rotary
kilns. Coal-bed methane (cbm) fields have been discovered
in eastern India in the recent past. This region is also a hub
of iron ore and steel manufacturing; therefore cbm could
also be an alternative to natural gas in the region as its price
would be lesser than that of natural gas. Model rotary kilns
should be set up to experiment with natural gas and cbm as
fuels. The ultimate goal would be to shift coal-based rotary
kilns completely to gas or other alternate cleaner fuels using
appropriate and affordable technological interventions.
• Action 2: Making waste heat recovery boilers and systems

mandatory in coal-based dri plants: Rotary kilns used in
coal-based dri plants often use non-coking coal due to the low
investment needed. The energy balance of rotary kilns shows
an energy efficiency of around 37 to 55 per cent.
A major factor behind this low energy efficiency is the non-

utilization of waste heat contained in outgoing gases.
In the usual process, these high temperature gases need to

be cooled down to be sent to electrostatic precipitators and
further out through stacks at a much lower temperature.
Instead of cooling these gases, if their heat can be used by
waste heat boilers in generating steam, it could help in power
generation, the plant could become more energy efficient and
also accrue the co-benefit of meeting internal electricity needs
with waste heat or sell the electricity for additional revenue.49
Many coal-based dri plants in India have already installed

waste heat recovery systems. Others need to follow suit.
63

Such systems should be made mandatory for all plants with

immediate effect.
• Action 3: Increasing the share of scrap-based eaf and gas-

based dri-eaf steel in overall steel production in India: A
major strategy should be to increase the share of scrap-based
eaf and gas-based dri-eaf steel production in India. Natural
gas-based dri-eaf process reduces emissions by 42 per cent
compared to bf-bof,50 and 100 per cent scrap-based eaf
production has the potential to bring down emissions by more
than one-fourth compared to the bf-bof route.
If the electricity source turns renewable, process emissions

might come down to almost nil. These two paths of steel
production are the cleanest ones currently available.
Hindrances that are preventing their wider adoption should be
removed on a priority basis.
7.3.2 OPTIONS FOR INDUCTION FURNACES

Induction furnaces have a 30 per cent share in India’s steel
production (as of 2020–21). One drawback of induction furnace
technology is that it lacks refining capacity, which means that
raw materials need to be of good quality and without impurities
or else it may lead to production of lower quality steel. Currently,
scrap is not easily available in India as per demand. The quality
of scrap available is also not good. Therefore, induction furnaces
often end up producing low-quality steel.
With the growing demand for steel in India, various steel

consuming sectors are setting high standards for the quality of
steel they use. As of June 2019, the Ministry of Steel had mandated
compulsory Bureau of Indian Standards (bis) certificates for 53
of the 140 categories of steel products and has asked secondary
steel producers to voluntarily take bis certificates for the rest of the
categories. The challenge for induction furnace producers is to be
able to meet these high-quality standards.
64

CHINA’S CRACKDOWN ON INDUCTION FURNACE STEEL
China had designated the steel industry as a driver of its economy way back in 2005. It would meet the
government’s plan for modernization of infrastructure,manufacturing and construction.By 2006,the country
became the world’s largest steel exporter,rising from being the fifth-largest in 2005.Gradually,it became the
largest producer of steel in the world, which it remains till today. The Chinese government gave huge subsidies
to the steel sector to increase production,which enabled Chinese producers to sell their steel at cheaper
rates than other countries. A majority of these subsidies were on coal.However,due to rampant production, the
quality of the steel went down.
This overproduction turned to be problematic in 2014.The domestic demand in China went down by 3.4 per
cent as the country’s construction boom came to an end,which forced steel producers to sell their surplus
steel to foreign buyers at throwaway prices.This led to a sharp decline in steel prices globally.In order to
protect domestic steel producers from this catastrophic phenomenon,other countries took around 400
trade actions,a majority of them focusing on Chinese steel.These actions were mostly taken as a safeguard
against the entry of sub-standard steel coming from China.For example,the US imposed countervailing
duties as high as 236 per cent on steel from China.The problem of excess capacity was highlighted across
the world.
Due to mounting international pressure,China decided to cut down its steel production by 150 million tonne
by 2020.The idea was to shut down outdated and excess capacity. As a result,China started coming down
heavily on induction furnace operators across the country as inspections by various provincial governments
led to the finding that induction furnaces were the primary producers of polluting sub-standard steel.In
January 2017,the Chinese government set a deadline of 30 June 2017 to eliminate induction furnaces
entirely from China.The country’s Ministry of Industry prohibited sale of steel scrap to induction furnace
operators,thus starving them of their main raw material.China,way ahead of its target,was successful in
cutting down its steel capacity by 155 million tonne between 2016 and 2018,out of which 140 million
tonne was low-grade steel capacity from induction furnaces.51 A lot of the induction furnace plants
eliminated from China have found their way into Southeast Asian countries like Indonesia and Philippines.
China continues to cut down its steel capacity,now keeping in mind the carbon neutrality target it has
committed to by 2060.It is further promoting scrap-based electric arc furnaces (EAF) as they are less
polluting compared to traditional blast furnaces and use steel scrap as raw material instead of iron ore. Units
with EAF also produce better quality steel than induction furnaces.
Therefore, to be able to maintain the quality of steel, induction

furnaces in India should be eliminated (see Box: China's
crackdown on induction furnace steel). Or, at the very least, they
should be required to install refining technologies like ladle-
refining furnace and gas oxygen refining. One such example of
an induction furnace that has installed a refining facility is Kashi
Vishwanath Steel in Kashipur, Uttarakhand.
65

CSE PROPOSAL FOR
8
STEEL SECTOR'S
DECARBONIZATION:
ACCELERATED LOW-
CARBON SCENARIO
66

The iron and steel sector is essential for economic growth as
we understand it today. The problem is that it is very hard to
decarbonize. Though there are options that exist, so that even as
India grows and reaches the steel production target of 255 mt by
2030, the emissions curve can be bent even further. Our objective
has to be to de-link the growth of this sector with the growth in
emissions.
cse proposes three co2e reduction scenarios, based on the current

three major transformations—fuel change, high steel scrap utilization,
and adoption of carbon capture and utilization in steel production.
These scenarios are followed by a fourth scenario which combines all
three of them.
Ideally, India should change the technology/production route for steel

manufacturing from bf-bof to dri-eaf as this would enable deeper
emissions reductions.
However, because of the current limitation in the availability of

natural gas and good quality recycled scrap, most of the expansion
is happening through the bf-bof route. Therefore, we have assumed
that till 2030 the proportion would remain as targeted by the National
Steel Policy, 2017 (bf-bof: 65 per cent and dri-eaf: 35 per cent).
8.1 REPLACING COAL WITH GAS AND OTHER

CLEANER FUELS BY 2030
Currently, natural gas is one of the major cleaner fuels available in
India that can replace coal.
Natural gas can be used in both the steel production routes; but, in
the bf-bof route, its usage is limited to a certain share which is still
being experimented with in other parts of the world. As natural
gas (methane) cannot be used directly in a blast furnace, a steam
reformer is used to convert it into synthetic gas which is then used in
the blast furnace. Recently, some companies, like the Energe Iron
Company in the US, have attempted to use natural gas directly in
the blast furnace without reforming. Paul Wurth—an engineering

CSE PROPOSAL FOR STEEL SECTOR'S
DECARBONIZATION
Table 16: GHG emissions in a BAU scenario and scenario of fuel change by 2030
Technology Estimated Emission factor GHG Action taken for 2030 Emission factor GHG emissions
production in (BAU scenario) emissions in (improved) (in million
2030 (in million 2030—BAU tonne) in 2030
tonne) scenario (in with Action 1—
million tonne) fuel change
BF-BOF 165.75 (65 per 2.5 414.37 Introduction of natural gas 2.024 335.47
cent production) injection or hydrogen across
all production
DRI-EAF 89.25 (35 per 3-3.2 (with coal) 244.81 100 per cent production 1.6 (with gas) 142.8
cent production) 1.6 (with gas) switches to gas for the entire
production
through this
route
Total 255 659.19 478.27
company providing technology for the global iron and steel making
industry—claims a reduction of 28 per cent in co2e emissions if
natural gas-based synthetic gas is injected in the blast furnace.
The other option in the bf-bof route is to use hydrogen—which is

still in the development stage. Therefore, in this scenario, cse has
assumed that all bf-bof route production in India implements natural
gas-based injections or introduces hydrogen.
For the dri-eaf route, it has been assumed in this scenario that 100
per cent production shifts to gas-based dri route.
The fuel change strategy would lead to reduction from 659 million
tonne in a bau scenario to around 478 million tonne. Clearly, this
will make a huge difference, particularly for the extremely
polluting dri-eaf manufacturing route.
8.2 INCREASE SCRAP UTILIZATION IN STEEL

MANUFACTURE TO REDUCE CARBON INTENSITY BY
2030
A major second step that can be taken to reduce ghg emissions from
the iron and steel sector is maximizing the usage of scrap in iron and
steel manufacturing. Both the technology routes have the potential to
use scrap.
68

This is a big game-changer as increased use of scrap will reduce the
carbon intensity of this industry. Use of scrap is also important in
terms of circular economy targets of the country.
As per the Steel Scrap Policy, the country produces some 25 million
tonne of steel scrap and imports an additional 7 million tonne. It
can be assumed that this quantity of 32 million tonne is used in the
production of 103 million tonne of steel—roughly 30 per cent of the
country’s overall production.
The bf-bof technology can use up to 30 per cent scrap in bof along
with hot metal, whereas the electric arc furnace technology can use
100 per cent scrap as a raw material replacing dri completely.
By mandating the use of 30 per cent scrap in the bf-bof route, co2e
reduction will be equivalent to the scrap used, i.e., 30 per cent.
By undertaking this action to mandate highest usage of scrap in

2030, this sector will see reduction in emissions from around 659
million tonne in BAU scenario to 343 million tonne.
Table 17: GHG emissions in a BAU scenario and as per Action 2—high scrap utilization, in
2030
Technology Estimated Emission GHG emissions Action taken Scrap Emission factor GHG emissions
production in factor in 2030—BAU for 2030 requirement (in (improved) (in million
2030 (in million (BAU scenario (in million tonne) tonne) in 2030
tonne) scenario) million tonne) with Action
2—increased
scrap
utilization
BF-BOF 165.75 (65 per 2.5 414.37 Introduction 50 1.75 290.06
cent production) of 30 per cent
scrap input in
the BF-BOF
route
DRI-EAF 89.25 (35 per 3–3.2 (with 244.81 100 per 90 0.6 (for 53.55
cent production) coal) cent scrap the entire
1.6 (with based-EAF production
gas) production through this
route)
Total 255 659.19 140 343.61
69

DECARBONIZATION
In order to achieve complete scrap-based production through

the electric arc furnace route and partial scrap-based production
through the bf-bof route (as demonstrated in this scenario), more than
140 million tonne of scrap will be required by 2030. To obtain this
quantity of raw material, the country will need to set up systems for
increasing the collection of good quality scrap—particularly from the
automobile and ship-building sectors.
8.3 IMPLEMENT CARBON CAPTURE AND

UTILIZATION BY 2030
Another option that has the potential to bring down co2e emissions
from the industry (at least from the bigger steel plants) is carbon
capture and utilization (ccu). ccu is expensive, but big players of the
sector have already started using it at many of their plants.
The Tata Steel plant at Jamshedpur is already capturing around 5

per cent of its daily co2 emissions through ccu technology. With
green hydrogen costs likely to remain high in the near future, a large
portion of ghg emissions can be brought down through ccu.
Therefore, under this proposal, cse has assumed at least 30 per cent
co2e reduction through ccu through the overall bf-bof route by 2030.
Table 18: GHG emissions in a BAU scenario and with implementation of CCU in BF-BOF route
by 2030
Technology Estimated Emission factor GHG emissions Action taken for Emission factor GHG emissions (in
production (BAU scenario) in 2030–BAU 2030 (improved) million tonne) in
in 2030 (in scenario (in 2030 with Action 3—
million tonne) million tonne) implementation of CCU
BF-BOF 165.75 (65 2.5 414.37 30 per cent 1.75 290.06
per cent CCU for whole
production) production
through this
route
DRI-EAF 89.25 (35 3–3.2 (with coal) 244.81 244.81
per cent 1.6 (with gas) N.A. N.A.
production)
Total 255 659.19 534.87
N.A. = Not available
70

This is important. as in the bf-bof route, other options for reducing
carbon intensity—change of fuel or the use of 100 per cent scrap—are
limited. Therefore, ccu is the one technological option that would
drastically reduce emissions.
As the cost of ccu is high, it would also be important for this sector to
look into the possibility of generating international climate finance.
If ccu is implemented in the bf-bof production route, and 30 per cent

co2 emissions are captured, ghg emissions can be expected to abate
from 659 million tonne in a bau scenario to around 548 million tonne
by 2030.
For this, ccu needs to be made mandatory for large steel plants and
clear targets need to be set for ccu, along with provisions of finance
to enable this transition.
8.4 OVERALL COMBINED ACCELERATED LOW-

CARBON SCENARIO IN 2030
In this scenario, cse has projected the co2e emissions reduction
that can be achieved by the sector by 2030 if all three major co2e
emissions reduction steps discussed above are combined.
For the dri-eaf route, two pathways or options have been shown.
Option 1 is that all production is from the scrap-eaf route and option
2 is total shift of this route to gas-based dri production.
For the bf-bof route, the options of scrap utilization and gas
injections are the same. In addition, there is a third option of
implementing ccu.
This shows the possibility of drastic reductions. If all the

best-available technology options are implemented, then ghg
emissions can be reduced down to 140–230 tonne by 2030. This
is a reduction of close to 80 per cent over the bau in the best case
scenario.
71

DECARBONIZATION
Table 19: Total and technology-wise actions, GHG emissions and percentage reduction
achieved under the accelerated low-carbon scenario
Technology S. no. Action Emission factors GHG emissions Percentage
in the accelerated reduction over
low-carbon GHG emissions
scenario in 2030 in a BAU
(in million tonne) scenario in 2030
BF-BOF 1. 28 per cent natural gas injection 2 335.47 19
2. 30 per cent scrap utilization 1.75 290.06 30
3. 30 per cent CCU 1.75 290.06 30
4. With all the above actions 86.85 79
DRI-EAF 1. 100 per cent gas for production 1.6 142.8 41.6
or
2. 100 per cent scrap-based 0.6 53.55 78
production
Total with Option 1— 229.65
gas-based DRI-EAF
Total with Option 2— 140.4
scrap-based EAF
Graph 10: Technology-wise GHG emissions in 2020–21, BAU scenario (2030) and combined
accelerated low-carbon scenario—Options 1 and 2, 2030
700 659.18
600
500
414.37
400
300 272.7
244.81 229.65
200 156.21 142.8 140.4
116.49
86.85 86.85
100 53.55
0
GHG emissions in 2020–21 GHG emissions in a business- Combined accelerated low- Combined accelerated low-
as-usual scenario in 2030 carbon scenario in 2030 carbon scenario in 2030
(with Option 1—gas-based (with Option 2—scrap-
DRI–EAF) based EAF)
Scenarios
GHG emissions from BF–BOF route GHG emissions from DRI–EAF route Total GHG emissions
72

Graph 11: GHG emissions in a BAU scenario, and separate and
combined steps of accelerated low-carbon scenario by 2030
700 659.19
600 548.5
500 478.27
400
343.61
300
200
100
0
BAU scenario for Optimum Optimum Implementation of
2030 fuel change scrap-based CCU in BF–BOF
by 2030 production by 2030
Scenarios
This shows the impact these three major decarbonization

strategies could have on the sector and why the government should
immediately set compelling targets for this industry and enable the
transition with respect to fuel change, scrap availability and finance.
This estimation shows how the co2e emissions reduction

potential assumed by the government under the low-carbon
scenario for 2030 and by large steel companies under the
improved low-carbon scenario for 2030 is far too little compared
to what can actually be achieved. It clearly shows that the future
growth of the steel industry of the country can be delinked from
greenhouse gas emissions. If net zero has to be achieved by India
in 2070, accelerated low-carbon strategies are required for this
and other carbon-intensive sectors of the country. This is the
need of the hour, and needs a steely resolve to be fulfilled.
73

DECARBONIZATION
Graph 12: GHG emissions in current scenario for 2020–21 and in different scenarios in
2030
700 659.19
CSE’S PROPOSAL
600 577.57
511.25
500
400
300 272.7
229.65
200
140.4
100
0
Current scenario for BAU scenario for Low-carbon Improved low- Combined Combined
2020–21 2030 scenario for carbon scenario for accelerated low- accelerated low-
2030 (As per 2030 (Based on carbon scenario for carbon scenario for
National Steel voluntary targets 2030 (Option 2030 (Option
Policy 2017) of large steel 1—with gas- 2—with scrap-
companies) based DRI–EAF) based EAF)
Scenarios
74

DECARBONIZING
9
INDIA’S IRON AND
STEEL SECTOR:
KEY FINDINGS AND
RECOMMENDATIONS
75

DECARBONIZING INDIA'S IRON AND STEEL
SECTOR: KEY FINDINGS AND RECOMMENDATIONS
Iron and steel is a hard to decarbonize sector, but also critical as it

contributes to both economic development in countries and global
greenhouse gas emissions. In a world that is facing an existential
threat because of climate change, it is clear that much more needs
to be done to reduce emissions from all sectors—the iron and steel
industry is, therefore, key.
The iron and steel sector contributed 7.2 per cent of total
global emissions in 2016; while the Indian iron and steel sector
contributed 4.75 per cent of the country's ghg emissions.
China is the world’s largest crude steel producer, followed

by India. But there is little comparison between the two as
China produces 10 times as much crude steel as India. China’s
production in 2019 stood at 1,000 million tonne—over half the
world’s total steel production. In the same year, India produced
100 million tonne of steel.
As per National Steel Policy, 2017, India’s expected steel

production capacity will be 300 million tonne and India’s steel
production will be 255 million tonne by 2030.
The per capita steel consumption in India is expected to be 160 kg

by 2030–31—up from 74.6 kg in 2019–20. But even in 2030, with
this increase, India’s per capita steel consumption will be lower
than the global per capita of 2019–20, which was 229 kg.
POLICY, TECHNOLOGY AND EMISSIONS

Iron is majorly of two types—hot iron or pig iron (produced
through blast furnace to produce steel through basic oxygen
furnace) and direct reduced iron or sponge iron (to produce steel
through electric arc furnace or induction furnace).
The reason it is important to understand the process of iron and

steel making is because it is directly linked to emissions.
Two major routes of steel production in India are through the

blast furnace-basic oxygen furnace (bf-bof) technology and
scrap/direct reduced iron-electric arc furnace/induction furnace
(scrap/dri-eaf/if) technology.
76

Around 70 per cent of the crude steel production in the world
and 45 per cent of the crude steel production in India was done
through the bf-bof route in 2020. Of the remaining 55 per cent,
the electric arc furnace manufactured 28 per cent and the
induction furnace manufactured 27 per cent. India is the largest
producer of sponge iron or direct reduced iron and around 82 per
cent of its production is from coal-based small-scale units (which
have much higher emissions than gas-based units).
The major greenhouse gasses emitted during the process are

carbon dioxide (99 per cent), methane and nitrous oxide.
The National Steel Policy, 2017 includes targets for ghg reduction
for this industry. It projects a target of 2.2 to 2.4 tonne of co2e
emissions per tonne of crude steel produced through bf-bof route
and 2.6 to 2.7 tonne of co2e emissions per tonne of crude steel
produced through dri-eaf route in India by 2030.
As per the National Steel Policy, 2017, crude steel production in

India is projected to more than double by 2030–31. More than 120
million tonne of crude steel production capacity expansion has
already been planned by the large scale steel players in India.
The problem is that the bulk of the proposed capacity expansion

is being planned through the bf-bof route in India—which is not
only more carbon intensive but also more difficult to decarbonize.
In bf-bof, coal is used as a reducing agent to turn ore into metal
and so it is difficult to substitute. This technology also has
limitations in the use of scrap as a raw material. The reasons why
India is moving towards bf-bof are unavailability of good quality
scrap, high prices of natural gas and the large-scale potential
of bf-bof technology. Given the projects that are underway and
expansion planned, India may not be able to meet its target to
limit the share of bf-bof steel production to 65 per cent by 2030.
ESTIMATED EMISSIONS FROM INDIA’S STEEL

SECTOR 2020–21
While India reported 135 million tonne of ghg emissions from the
steel sector in the third bur for the year 2016, cse estimated ghg
77

emissions from the iron and steel sector in India to be around 250
million tonne in 2016. The difference is possibly because of how
the energy emissions are accounted for in the bur methodology.
cse has calculated ghg emissions of the steel sector using its
estimated emission factors for different technologies which are
based on declarations and estimations made by Ministry of Steel
and disclosures made by steel companies.
Based on this data, cse has put forward the estimated range
of co2e emissions from major iron and steel manufacturing
technologies in India (see Table 10 on page 39). It finds that in
the case of bf-bof, the range of co2e emissions is between 2.2–
2.6 tonne per tonne of crude steel production. The Ministry of
Steel has declared that India has already achieved ghg emission
factor of 2.5 for the bf-bof route as of 2020, somewhat close to
the 2030 target.
The most polluting manufacturing technology remains the coal-

based dri-eaf/if—the range here is between 2.8–3.2 tonne of co2e
emissions per tonne of crude steel manufactured. The problem
is that 82 per cent of the dri production in India is through
coal-based rotary kilns, which are small-scale with high co2e
emissions.
The lowest emissions are from gas-based dri-eaf—between 1.4–

1.8 tonne of co2e per tonne of crude steel manufactured. But only
around 18 per cent of the dri production in India is gas-based and
its share has not increased due to non-availability and high price
of natural gas.
cse has also calculated the emissions of each iron and steel plant
in the country as technologies differ and so do the emissions (see
Table 8 on page 35). If the company has declared its emission
factor, this has been used in the computation. Otherwise,
the emission factor for the particular technology used by the
company has been used for computation.
cse has also taken into account the production capacity of small-
scale manufacturers as per government estimates. They have
been assumed to be using coal-based dri-eaf/if technology for
78

iron and steel manufacturing. The average emissions are taken to
be 3 tonne of co2e per tonne of crude steel manufactured. Small-
scale manufacturers produced between 37–47 million tonne of
crude steel in 2020–21 (depending on various estimates). Based on
these figures, this segment emitted between 112.78–139.51 million
tonne of co2e—roughly 41–51 per cent of the total emissions from
the iron and steel sector.
This is also evident in the 2020–21 technology-wise ghg emission

estimation. This shows that the contribution of coal-based dri-
eaf/if units is even higher than the contribution from bf-bof
technology in the country—which is contrary to the global
experience, where this technology scores higher in terms of
emission profile.
The aggregation of estimated plant-wise data reveals that India’s

iron and steel industry with a production of 104 million tonne
emitted 267.48 million tonne of co2e in 2020–21.
cse has estimated the company-wise GHG emission profile as

well (see Table 9 on page 37). This follows the production of the
companies.
Tata Steel, India’s largest steel company, contributes some 14.5

per cent of the total emissions from this sector; closely followed
by the public sector sail and jsw Steel.
The three top companies—Tata Steel (India) Ltd, sail and jsw
Steel—with a combined 47.05 million tonne of production in
2020–21 (45 per cent of the country’s production) contributed 43
per cent of the emissions.
The sponge iron companies (dri-eaf/if), mostly operating in the

medium- and small-scale sectors, contributed 41–51 per cent of
the ghg emissions with some 37–47 million tonne of production
in 2020–21.
This clearly shows where the priority for improvement for

emission reduction must be—the big three and the small and
medium producers.
79

FUTURE EMISSIONS: IN 2030

cse has projected four ghg emission scenarios for the sector for
2030:
a. Business-as-usual (bau) based on production in 2030 and
current technology
b. Low-carbon growth pathway based on emission targets set
the National Steel Policy, 2017
c. Improved low-carbon growth pathway based on voluntary
targets by large steel companies (as publicly declared)
d. Accelerated low-carbon growth pathway, which is cse’s
proposal based on the best available technologies and options
for de-carbonizing the sector.
As per this we find:
In the bau scenario, ghg emissions from the iron and steel sector
will grow 2.5 times by 2030 compared to 2020–21—from 272.7
million tonne to 659.19 million tonne.
In the low-carbon growth pathway, there is a reduction of 12.5 per

cent (82 million tonne) compared to the bau scenario.
In the improved low-carbon growth pathway, there is a reduction

of 22.5 per cent (148 million tonne) compared to the bau scenario.
This is because of the enhanced emission reduction targets
declared by Tata Steel (India) Ltd, jsw Steel and AM/NS India
Ltd. But the total emissions would still be 511.25 million tonne of
co2e—which is just a little less than double of current emissions.
The question then is what more can be done to decarbonize the

Indian iron and steel sector? What are the fuel and technology
options that would allow the country to bend the curve of its
emission trajectory, without losing out on the development
opportunities that this sector provides?
Global average co2e emissions from the steel sector were 1.89
tonne per tonne of crude steel produced in 2020, according to the
World Steel Association. These are expected to go down further
by 2030. Countries like Canada and Spain have achieved average
80

emission factor of 1.5 tonne of co2e per tonne of steel produced
through bf-bof route—which is more difficult to decarbonize than
dri-eaf.
Gas based dri-eaf and scrap-based eaf are the lower-carbon

steel production technologies currently available. Globally, co2e
emissions from coal-based dri-eaf technology have been shown
to be around 1.9 tonne per tonne of steel production, clearly much
below the target set up in National Steel Policy, 2017.
PATHWAYS FOR REDUCING CARBON INTENSITY

cse has assessed the different options for reduced carbon
intensity in this industrial sector. The sector-wide emission
reduction options are:
1. To introduce technologies for increased fuel efficiency and

recovery (the Union Ministry of Steel has compiled a list
of such technologies). But these need to be mandated. For
instance, energy efficiency of rotary kilns in coal-based dri
units is hardly 37 to 55 per cent due to non-utilization of
waste heat, therefore waste heat recovery systems should be
made mandatory for coal-based dri units. Similarly, induction
furnaces in India should be restricted (to prevent excess of
poor quality steel) or at the very least be required to install
refining technologies like ladle refining furnace and gas
oxygen refining.
2. To increase availability of cleaner fuel for combustion so that

coal is substituted by natural gas or hydrogen. Use of green
hydrogen in steel production can achieve up to 21 per cent
co2e reduction through the bf-bof route and up to 95 per cent
co2e reduction through the dri-eaf route.
3. To increase availability of good quality steel scrap for material

and energy saving and reduction of carbon intensity. Every
tonne of steel scrap used to produce steel saves 1.1 tonne of
iron ore, 630 kg of coking coal and 55 kg of limestone. It can
reduce ghg emissions by close to 60 per cent. The Steel Scrap
Policy needs to ensure high scrap generation and utilization
targets.
81

4. To use carbon capture, utilization and storage (ccus),

particularly for bf-bof process in which substituting
coal is difficult. Therefore, the option is to upscale the
implementation of ccus, which is being tried out by big
players like Tata Steel (India) Ltd, jsw Steel and SAIL in their
manufacturing plants.
5. To examine the use of ultra-low co2e steel-making

technologies for their application and use in India.
CSE'S PROPOSAL FOR ACCELERATED LOW CARBON

GROWTH SCENARIO
Ideally, India should change the production route for steel
manufacturing from bf-bof to cleaner dri-eaf to enable deeper
emission cuts.
Strategy 1: Switch to clean fuel: Emissions reduction of 181

million tonne compared to the bau scenario can be achieved
through an optimal fuel change across the technology routes in
the sector. ghg emissions from the iron and steel sector would
go down from 659.19 million tonne in bau scenario to 478.27
million tonne in 2030. In this case, the bf-bof route would have
to implement natural-gas based injection or use hydrogen as fuel.
The dri-eaf route would have to shift completely to gas-based
production.
Strategy 2: Increase use of scrap: Emissions reduction of 316

million tonne compared to the bau scenario can be achieved
through optimal scrap utilization across the technology routes in
the sector. ghg emissions from the iron and steel sector would
be roughly halved from 659.19 million tonne in bau scenario to
343.61 million tonne in 2030. In this case, the bf-bof route would
be mandated to use 30 per cent scrap and dri-eaf route would
shift completely to scrap-based production.
Strategy 3: Implementation of carbon capture and utilization:

Emissions reduction of 111 million tonne from the BAU scenario
can be achieved in the sector by implementing ccu in 30 per cent
of total production. In this case, emissions in the bf-bof route
82

would go down from 414.37 million tonne in bau scenario to
290.06 million tonne in 2030.
cse has then combined the different strategies for the sector’s
low-carbon trajectory. It finds that ghg reductions of up to
429 and 519 million tonne can be achieved in the two options
proposed by cse in the accelerated low-carbon growth scenario
(see Table 19 and Graph 10 on page 72).
The emissions in the two options under the accelerated low-

carbon growth pathway scenario will be lesser than the current
emissions of the sector (2020–21).
The findings of this report show that the future growth of the
steel industry of the country can be de-linked from greenhouse
gas emissions but that this will require a roadmap for technology
changes, infrastructure and funds.
The game-changing options are:

1. To switch fuel: Particularly to move towards gas-based dri-
eaf production. And to introduce hydrogen in bf-bof.
2. To implement scrap-based production: Complete switch in
dri-eaf and 30 per cent in bf-bof.
3. Implementing ccu in bf-bof for reducing 30 per cent of the
emissions.
RECOMMENDATIONS
It is clear that there are opportunities for reduced carbon
intensity, even in this hard to decarbonize industrial sector. The
technology options provided in this report suggest the various
interventions that are possible. We realize that the roadmap
provided in this report may be overly ambitious—but given the
challenge of climate change and the existential threat it poses, it
is also clear that we must move beyond the ordinary to the extra-
ordinary and that business-as-usual must become unusual. Our
attempt is to understand what the possibilities are. To see how
we can achieve this plan in the coming years, we recommend the
following:
1. The infrastructure for clean fuel and scrap availability is key
and this needs government intervention.
83

2. The Union Ministry of Steel should mandate the optimal use

of steel scrap by 2030—with a clear roadmap for 30 per cent
and 100 per cent switch. This will provide the right signals
to the market for sourcing good quality scrap. This will also
move India towards a circular economy and reduce waste and
improve resource utilization.
3. The switch to the use of hydrogen and ccus in the bf-bof

route will require international finance. The government and
steel industry should work towards a combined proposal for
climate finance with targets for 2030.
4. The big opportunity is to re-work the dri-eaf route. This

would require working with the medium- and small-scale
plants so that they are enabled to either make the switch to
cleaner fuel (natural gas) or move towards 100 per cent use
of scrap material for steel production. This requires a steel
mission for sponge-iron plants so that they are provided the
assistance to make this transition.
The low-carbon pathway has the opportunity to create economic

wellbeing but not at the cost of the planet.
84

ANNEXURE
Table: Emission factors estimated by CSE for this report and the assumptions and sources
referred to for them
S. no. Major iron and Estimated Reference (based on which the range of emission factor was decided)
steel production average CO2e
technologies emission factor
(in tonne)
per tonne of
crude steel
production, as
of 2020
1. BF-BOF 2.5 - Lowest publicly declared BF-BOF plant emission factor is 2.29.52
- JSW Steel has declared its company’s average emission factor as 2.49.
- SAIL has declared it as 2.54.
- The CO2 emission factor declared by the Ministry of Environment, India for BF-
BOF route is 2.5, as of 2020.
- Therefore, CO2e emission factor for BF-BOF route has been taken as 2.5 tonne
CO2e per tonne of steel produced.
2. Coal-based DRI- 3 - Assumptions made by Ministry of Steel for arriving at INDC values in 2014–15
EAF/IF mention emission factor for coal-based DRI-EAF/IF in the range of 3–3.2 tonne
and assume that it would become 2.8–2.9 tonne in 2020 on adoption of relevant
technologies.
- Since adoption of relevant technologies in coal-based DRI was not as assumed,
the emission factor range assumed is 2.8 to 3.2. Therefore, the average emission
factor taken for coal-based DRI-EAF/IF route is 3 tonne CO2e per tonne of steel
produced.
3. Gas-based DRI- 1.6 - A research article by Zhiyuan Fan and Julio Friedmann published on the
EAF website of Columbia University's Centre on Global Energy Policy mentions CO2
emission factor for this technology as 1.39 tonne of CO2 per tonne of steel
produced.53
- An article by Ben Ellis and Wenjun Bao on the Broken Hill Proprietary Company
website mentions the CO2 emission factor for this technology as 1.4.54
- A research article, “Influence of direct reduced iron on the energy balance of
the electric arc furnace in steel production” on ResearchGate mentions CO2
emissions from gas-based DRI-EAF in different ranges for different sets of
samples based on the emissions from generation of electricity in different
locations. Since India largely produces coal-dependent electricity and most
of the gas-based DRI plants source energy from the grid, two of the highest
emission factors given have been considered, i.e., 1.4 and 1.8.55
- Therefore, the emission factor for gas-based DRI-EAF has been assumed as an
average of 1.4 and 1.8, i.e., 1.6.
4. Coal gasification- 2.9 - Since only one plant in India is running on this technology (JSPL plant), and
based DRI-EAF/ the plant emission factor has not been declared publicly, therefore the emission
EOF factor was sourced from Steel Research and Technology Mission of India,
which mentions that it is in the range of 2.8–3 tonne of CO2 emissions per
tonne of steel produced. Therefore, the average of 2.9 has been considered for
this technology.
85

ANNEXURE
S. no. Major iron and Estimated Reference (based on which the range of emission factor was decided)
steel production average CO2e
technologies emission factor
(in tonne)
per tonne of
crude steel
production, as
of 2020
5. 100 per cent 0.6 - An article by Dr Ben Ellis and Wenjun Bao on the BHP website mentions the
scrap-based EAF CO2 emission factor for this technology as 0.456
and IF - A research article by Zhiyuan Fan and Dr Julio Friedmann published on the
website of Columbia University's Centre on Global Energy Policy mentions
CO2 emission factor for this technology as 0.84 tonne of CO2 per tonne steel
produced.57
- Therefore, the range assumed is 0.4–0.8 tonne CO2e per tonne of steel
produced and the CO2e emission factor for scrap-based EAF has been taken as
0.6.
6. Corex—oxygen 2.6 - Compared to conventional blast furnace iron-making system, direct CO2
converter emissions of Corex are higher. Considering the credits of export gases for
(basic oxygen power generation, the total CO2 emissions of Corex have advantages only
furnace/Conarc when the Corex is joined with high-efficiency generating units whose efficiency
technology) is greater than 45 per cent and when the CO2 emission factor of the grid is
higher than 0.9 kg CO2/kWh.58
- As per the Steel Research and Technology Mission of India, Corex basically
consists of a gasifier and produces corex gas (CO + H2). If this gas is exported
and used in power generation at an electric arc furnace (with midrex or conarc
tech) with the prescribed efficiency, it can have CO2 emissions a little less or
equivalent to a blast furnace, i.e., around 2.4, else if the corex gas is not being
utilized, emissions are higher than that of a blast furnace, i.e., around 2.8.
Since we do not know whether the current corex technology in JSW Steel
and ArcelorMittal Nippon Steel India plant is using the gases in prescribed
efficiency or not, we have considered an average of 2.4 and 2.8, i.e., 2.6.
7. BF-EOF 2.5 - Energy optimization furnace technology allows oxygen lancing from the side
unlike BOF in which it is done from the top. This allows reduction in O2 usage
in the process but the reduction achieved in CO2 emissions compared to BOF
is hardly 1–2 per cent, therefore CO2 emissions of this technology can be
considered equivalent to BF-BOF in this case, i.e. 2.5.
86

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37. Ibid.
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92

India is the second largest
producer of crude steel
in the world and plans to
almost triple its production
by 2030. Under a business-
as-usual scenario, the CO2
emissions from crude steel
production are estimated to
grow to almost 2.5 times by
2030. This report provides
a detailed insight into the
current status of the iron
and steel sector and its
GHG emissions in India.
It suggests a roadmap for
the sector, highlighting
the pathways for GHG
emissions reduction.
Centre for Science and Environment

41, Tughlakabad Institutional Area, New Delhi 110 062
Phones: 91-11-40616000 Fax: 91-11-29955879
Website: www.cseindia.org

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DECARBONIZING

IRON AND STEEL SECTOR

Decarbonizing India’s Iron and Steel Sector report.indd 1 28/09/22 2:11 PM

CENTRE FOR SCIENCE AND ENVIRONMENT

Decarbonizing India’s Iron and Steel Sector report.indd 3 28/09/22 2:11 PM

Author: Parth Kumar

Editors: Arif Ayaz Parrey and Akshat Jain

Design and cover: Ajit Bajaj

Graphics: Sanjit Kumar

Production: Rakesh Shrivastava and Gundhar Das

The Centre for Science and Environment is grateful to the Swedish

© 2022 Centre for Science and Environment

Material from this publication can be used, but with acknowledgement.

Maps used in this document are not to scale.

Decarbonizing India’s Iron and Steel Sector report.indd 4 28/09/22 2:11 PM

Background and introduction 7

Iron and steel industry in India—

Manufacturing process and

Future production and capacity additions 31

GHG emissions from India’s steel sector 37

Future emissions: 2030 47

Pathways for carbon intensity

CSE proposal for steel sector's

Decarbonizing India’s iron and steel sector:

Decarbonizing India’s Iron and Steel Sector report.indd 5 28/09/22 2:11 PM

Decarbonizing India’s Iron and Steel Sector report.indd 7 28/09/22 2:11 PM

1.1 GLOBAL CONTEXT

Anthropogenic emissions of carbon dioxide (co2) and other

Thus, current global warming is a result of both recent emissions

The significant sectors contributing to ghg emissions

Iron and steel is a key sector, as it alone contributed 7.2 per

Decarbonizing India’s Iron and Steel Sector report.indd 8 28/09/22 2:11 PM

Source: Climate Watch, the

1.2 INDIA’S GREENHOUSE GAS EMISSIONS

Table 1: GHG emissions in India in 2016 by sector

Decarbonizing India’s Iron and Steel Sector report.indd 9 28/09/22 2:11 PM

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

1A1a Electricity p roduction, CO2 39.53%

1A3b Road transport, CO2 8.57%

3A1 Enteric fer mentation , CH4 7.84%

1A2m Nonspecific industr ies, CO2 6.37%

1A2a I ron and steel, CO2 4.75%

1A4b Residential, CO2 4.47%

2A1 Cement production, CO2 3.75%

3C4 Agricultural soils, N2O 2.74%

1A1b Refinery, CO2 2.53%

3C7 Rice cultivation, CH4 2.51%

1A4a Commercials/ Institutional, CO2 2.42%

1A2f Cement, CO2 1.88%

2C3 Aluminium prod uction, CF 1.18%

2A2 Lime p roduction, CO2 1.00%

3A2 Manure management, N2O 0.87%

The energy sector is the biggest contributor to ghg emissions in

The share of industrial processes and product use category in

Decarbonizing India’s Iron and Steel Sector report.indd 10 28/09/22 2:11 PM

Decarbonizing India’s Iron and Steel Sector report.indd 11 28/09/22 2:11 PM

China is the largest crude steel producer in the world, followed by

A comparison of the increase in steel consumption in India with

According to government data, the sector employs half a million