Steel Decarbonisation in India

The report analyzes India's steel industry, which accounts for 12% of the country's CO2 emissions, and argues that transitioning to green hydrogen-based steelmaking is the most viable path to net zero by 2070. It identifies significant barriers, including the high cost of green hydrogen, the lack of a legal definition for 'green steel', and the young age of existing blast furnace fleets. The authors recommend government intervention through carbon pricing, mandatory green steel procurement in public projects, and the implementation of green hydrogen purchase obligations to make low-carbon technologies commercially competitive.

• India's steel sector is responsible for approximately 240 million tonnes of CO2 emissions annually, with an emission intensity of 2.55 tCO2/tcs, which is 12% higher than the global average of 1.85 tCO2/tcs.
• Green hydrogen is expected to become the primary route for steelmaking in India only by 2050, as it requires significant cost reductions and carbon penalties to be competitive.
• The report forecasts a phased transition: coal-based technologies will drop from 92% in 2021 to 70% by 2030, with green hydrogen replacing 25-30% of grey hydrogen requirements in the early 2030-2050 period, increasing to 80% by 2050.
• A critical barrier to decarbonisation is the lack of a legal taxonomy for 'green steel' in India, which leaves the necessary technology track unclear for industry investment.
• The European Union's Carbon Border Adjustment Mechanism (CBAM) poses a significant financial risk to Indian steel exports, with potential profit reductions of US$60-US$165 per tonne between 2026 and 2034.
• The young average age of India's Blast Furnace/Basic Oxygen Furnace (BF/BOF) fleet (15 years) creates a risk of stranded assets valued between US$153-220 billion as the country continues to add capacity via this route.
• Carbon Capture, Utilisation and Storage (CCUS) is viewed as an unreliable and energy-intensive interim solution that often underperforms and risks becoming a stranded asset.
• The National Green Hydrogen Mission (NGHM) has allocated 30% of its pilot project budget, totaling Rs14.66 billion (US$177 million), specifically to the Ministry of Steel.
• Micro, Small and Medium Enterprises (MSMEs) face unique challenges in transitioning, including low credit ratings and a lack of R&D support, necessitating blended finance mechanisms like the Partial Risk Sharing Facility for Energy Efficiency (PRSF).

APA

Global Energy Monitor (n.d.). Steel Decarbonisation in India. https://globalenergymonitor.org/sites/default/files/migration/reports/Steel-Decarbonisation-in-India_September-2023_3.pdf

Chicago

Global Energy Monitor. Steel Decarbonisation in India. n.d. https://globalenergymonitor.org/sites/default/files/migration/reports/Steel-Decarbonisation-in-India_September-2023_3.pdf.

Wikipedia

{{cite report |author=Global Energy Monitor |title=Steel Decarbonisation in India |url=https://globalenergymonitor.org/sites/default/files/migration/reports/Steel-Decarbonisation-in-India_September-2023_3.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{globalenergymonitorndsteel, author = {{Global Energy Monitor}}, title = {{Steel Decarbonisation in India}}, institution = {Global Energy Monitor}, url = {https://globalenergymonitor.org/sites/default/files/migration/reports/Steel-Decarbonisation-in-India_September-2023_3.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }