ELECTRIFYING INDUSTRIAL HEAT IN INDIA

The report argues that industrial electrification in India is economically viable across all temperature ranges when powered by low-cost solar energy. It finds that switching to electric technologies like heat pumps and thermal batteries can reduce industrial energy use by 22% and cut CO2 emissions by over half. The analysis highlights that solar-powered electrification is already cheaper than petroleum and natural gas across all temperatures and competitive with coal in several bands. To scale this transition, the report recommends streamlining Green Energy Open Access rules, reducing electricity cross-subsidies, and implementing production-linked incentives for clean commodities.

• Industrial electrification is economically viable across all temperature ranges used by industry in India. It is already cheaper than producing heat with biomass, natural gas, or petroleum across all temperatures, and is cheaper than coal-based heating in three of five temperature bands: <100°C, 100-200°C, and 1,000-1,800°C.
• Scaling industrial electrification to its full potential could reduce future industrial energy usage by over 22% (from a business-as-usual forecast of 38.6 EJ to 29.9 EJ by 2070) and cut future CO2 emissions by 51% (1,243 million metric tonnes), provided it is supported by clean electricity.
• Electrifying all eligible industrial processes in India could save approximately 794,000 lives annually by reducing non-GHG pollutants, specifically cutting particulate matter (PM2.5) by 38%, sulfur dioxide (SO2) by 60%, and nitrogen oxide (NOx) by 53%.
• India's solar energy costs are among the lowest of major economies, with recent auctions clearing a levelized cost of electricity (LCOE) under ₹2.5 per kilowatt-hour (kWh). This makes solar-powered electrification highly competitive compared to imported petroleum and natural gas, which typically cost 4-4.5 times more than coal per unit of energy.
• Industrial heat pumps are highly efficient for low-temperature heat (under 200°C), often providing 3 to 5 units of heat per unit of electricity consumed. They are competitive with coal-fired boilers under 100°C even when powered by grid electricity.
• Thermal batteries are a viable option for heat above the range of heat pumps, with current commercial models delivering heat up to 500°C. They have significantly lower capital costs than lithium-ion batteries, estimated at US$27 per kWh of capacity compared to US$150 per kWh.
• The iron and steel subsector is the largest industrial energy user in India, accounting for over a quarter of the sector's energy use in 2022. Other high-demand subsectors include chemicals, food, beverage, and tobacco, refining and fuel processing, non-metallic minerals, and pulp, paper and printing.
• Grid-powered electric technologies can increase emissions if the grid remains coal-heavy. For example, grid-powered electric resistance technologies are the highest-emitting configurations for heat up to 1,000°C due to India's current grid mix.
• Current electricity pricing in India involves cross-subsidies where industrial users pay higher rates to offset residential and agricultural costs. Removing these cross-subsidies could reduce industrial electricity prices by an average of 20%.

APA

Deshpande, S., Sawe, N., Rissman, J., Phadke, A., Bennett, J. L. D., & Abhyankar, N. (2026). ELECTRIFYING INDUSTRIAL HEAT IN INDIA. Energy Innovation. https://energyinnovation.org/wp-content/uploads/Electrifying-Industrial-Heat-in-India-1.pdf

Chicago

Deshpande, Sonali, Nikhil Sawe, Jeffrey Rissman, Amol Phadke, Jose Luis Dominguez Bennett, and Nikit Abhyankar. ELECTRIFYING INDUSTRIAL HEAT IN INDIA. Energy Innovation, 2026. https://energyinnovation.org/wp-content/uploads/Electrifying-Industrial-Heat-in-India-1.pdf.

Wikipedia

{{cite report |last1=Deshpande |first1=Sonali |last2=Sawe |first2=Nikhil |last3=Rissman |first3=Jeffrey |last4=Phadke |first4=Amol |last5=Bennett |first5=Jose Luis Dominguez |last6=Abhyankar |first6=Nikit |title=ELECTRIFYING INDUSTRIAL HEAT IN INDIA |publisher=Energy Innovation |date=April 2026 |url=https://energyinnovation.org/wp-content/uploads/Electrifying-Industrial-Heat-in-India-1.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{deshpande2026electrifying, author = {Deshpande, Sonali and Sawe, Nikhil and Rissman, Jeffrey and Phadke, Amol and Bennett, Jose Luis Dominguez and Abhyankar, Nikit}, title = {{ELECTRIFYING INDUSTRIAL HEAT IN INDIA}}, institution = {Energy Innovation}, year = {2026}, month = apr, url = {https://energyinnovation.org/wp-content/uploads/Electrifying-Industrial-Heat-in-India-1.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }