The Indian Steel Association (ISA) is urging the government to stipulate public projects must source at least a portion of their steel from low-carbon emitting steel producers.
It aims to achieve a CO2 emission intensity reduction in India to 2.4 tonnes of CO2/tonne of crude steel by the fiscal year ending 31 March 2030, Kallanish notes.
“Central to a successful journey towards decarbonisation of the steel industry is the availability of sufficient green hydrogen and renewable energy at competitive pricing,” says ISA president Dilip Oommen, also chief executive of AMNS India.
“The technologies required to adapt these with the existing infrastructure will be a real challenge. Therefore, the transition towards greening steel will incur high initial capital costs, and also operating low carbon steel plants will be considerably expensive in the short to medium term at least. The government needs to lay strong emphasis on R&D support, long-term finance availability at competitive rates, cross-sector collaboration, incentives along with a well-designed policy to accelerate this transition,” Oommen adds.
ISA has proposed authorities provide subsidies for technology investment or tax incentives to incentivise steelmakers to reduce their CO2 emission intensity below a set baseline/sectoral target. It is also seeking the implementation of a carbon credit mechanism for the transfer of technology to green steelmaking, and financing for breakthrough technologies. Also proposed to support decarbonisation are carbon capture and storage (CCS) and carbon capture utilisation (CCU).
“Some policy in line with Solar Power or National Bio-Fuel Policy may be introduced to promote carbon capturing and converting the same into sustainable fuel,” says ISA. “Direct incentives may be provided to the industry to make these technologies economically viable.”
ISA is also asking the government to implement a renewable power transmission charges waiver, to encourage investment into new hydrogen and carbon capture plants, and the use of renewable energy for new electric arc furnaces.
The association also suggests introducing standards for green steel to encourage its use in projects. Another suggestion includes funding demonstration projects for hydrogen, R&D on developing a hydrogen ecosystem in the industry and focusing on a carbon border adjustment mechanism (CBAM).
Sayed Aameer India
