Govt working on sops for steel companies to adopt green tech

Sandeep Poundrik, Steel Secretary 
| Photo Credit:
REUTERS

The government is working on a mission to decarbonise the steel industry by providing incentives for steel companies to produce more green steel and promote its usage by prescribing mandatory use in its industries.

Sandeep Poundrik, Steel Secretary said the government is working on a mission to decarbonise the most-polluting steel industry by encouraging it to adopt decarbonisation projects.

“We are working on a mission on green steel and will try to support the industry for decarbonisation in terms of incentives for producing more green or less carbon emitting steel,” he said at the ‘India Steel 2025’ conference on Friday.

“The incentives will be provided for using renewable power and similar components. The programme is under work and hopefully it will soon be approved by the government,” he added .

On green steel procurement policy, he said the government has already mandated that government companies and government sponsored projects should only use steel that is made in India. In the same way, there will be a mandate for government companies and projects to use a certain percentage of green steel. Both these proposals will be approved soon, said Poundrik.

While the Indian government has defined green steel as something that emits less than 1.6 tonnes of carbon emission per tonne of steel produced, the Europe considers steel made through scrap in electric arc furnace as green steel.

India does not produce that much of scrap to recycle steel completely. Last year, India generated only 25 million tonne of steel scrap.

Another alternate is to use DRI (direct reduced iron), but again it is not viable till India has domestic gas supply or availability of hydrogen below $2 from the current level of $5-$6, he said. Moreover, the iron content in ore in India is very less to adopt this process. The government has been encouraging Indian companies to set up DRI plants in geographies like West Asia and Australia where gas is easily available.

The government wants to tap the low hanging fruits and bring solutions that are relevant to India, said Poundrik.

A bigger challenge for the industry would to make small scale secondary steel companies which have 45 per cent of production capacity to adopt green technology. These units produce steel using cold DRI which emits more carbon.

“It is a big challenge to incentivise the small producers to adopt green technology for steel making,” he said.

Published on April 25, 2025