India needs more than $280 billion in investment to decarbonise its steel industry

The plans will focus on increasing the integration of renewable energy sources in the industry

India’s steel industry will require investments of approximately $283 billion to decarbonise existing plants. This is stated in a report by the country’s Ministry of Steel, the Economic Times reports.

Plans should focus on increasing the integration of renewable energy sources in the steel sector to 43% by fiscal 2029/2023, up from 7.2% in 2021/2022. In addition, the country may reduce taxes on green steel production to encourage its adoption, along with mandating the use of greener raw materials for luxury car manufacturers.

Implementation of the best available technologies at existing small steel mills alone is estimated at over $13 billion. The cost of the technological transition (direct reduction of iron, carbon capture and utilisation technologies) is another $150 billion, according to the roadmap and action plan for the decarbonisation of the country’s steel sector.

In addition, the comprehensive strategy developed by the relevant agency includes the use of Energy Efficiency Revolving Funds (EERF) and the definition of green steel parameters.

India will formulate a policy on green steel and consider public procurement of such steel products. The steel sector accounts for 12% of the country’s greenhouse gas emissions, with 2.5 tonnes of CO2 per tonne of steel produced, while the global average is 1.9 tonnes of CO2 per tonne of steel.