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Vitality intensive heavy Industries are a important pillar in India’s financial development aspirations. They’re additionally a key contributor to India’s direct and oblique Carbon emissions. Given fast financial development and urbanization, demand from these industries is predicted to develop considerably over the subsequent few a long time – development that would result in proportionately increased GHG (greenhouse gases) emissions. As India seeks to steadiness its financial development ambitions with its inexperienced transition, it is going to be important to evolve a carbon-neutral industrial mannequin for sustainable development.
Nonetheless, a low carbon pathway in heavy industries is considerably harder in comparison with different areas similar to Energy and Transportation. About 40 per cent of emissions in power intensive industries are from fossil gas feedstock and switching to alternate feedstock would require an entire change in manufacturing course of and applied sciences. One other one-third of emissions are from burning fossil gas to generate very excessive temperatures, the place different applied sciences are underdeveloped or very costly.
For instance, switching to renewable energy for top temperature functions would require electrical furnaces, that are nonetheless maturing as a know-how and face important price viability challenges. Given the capital intensive nature of those industries, rebuilding for brand spanking new course of or know-how with a decrease GHG footprint is a big capital funding that’s tough to finance with at present’s inherent sector economics. As well as, given excessive contribution of power or feedstock in price and low willingness from finish prospects to pay a premium for inexperienced merchandise, investments in GHG discount applied sciences are sometimes financially unviable. As such, power intensive industries are amongst the ‘hardest to decarbonize’ sectors.
Over the past decade, industries have targeted on incremental measures the place GHG discount helped in worthwhile development – e.g. improved power effectivity, waste warmth restoration, and partial substitution of excessive GHG feedstock (e.g. clinker discount in cement). Nonetheless, an accelerated path to web zero would require appearing on a mixture of demand measures similar to selling round financial system, continued push on power effectivity, electrification of warmth with renewables, carbon sequestration (carbon seize, utilization & storage), zero-carbon fuels similar to biomass and inexperienced hydrogen, and deployment of latest revolutionary applied sciences with non-fossil feedstock. Particularly, a low carbon pathway for 3 key power intensive industries – iron & metal, cement, and chemical compounds & fertilizers – would come with the next:
– Iron and Metal represents near 10% of India’s whole GHG emissions. Given the present manufacturing setup with heavy dependence on coal for power (greater than 80% of power inputs) and DRI furnaces, Indian iron and metal trade has the best GHG footprint amongst heavy industries. Decarbonizing this sector would require a mixture of measures similar to BF/BOF effectivity enhancements, elevated scrap recycling, shift in direction of electrical arc furnaces, biomass as gas in addition to new applied sciences similar to carbon seize and use of hydrogen to switch coke.
– Cement trade is one other important GHG emitter with CO2 emitted each from chemical course of in addition to power consumption related to the manufacturing course of. Given the growing demand from formidable infrastructure applications and housing schemes, it’s important to develop a web zero path for this trade. Whereas the sector is on monitor to attain its 2030 carbon discount objectives set inside Low Carbon Expertise Roadmap, a web zero pathway would require important change in manufacturing course of and adoption of latest applied sciences. Within the quick time period, adoption of fly ash to scale back cement to clinker ratio and power saving applied sciences similar to superior kilns, APCs, and so forth. ought to be accelerated. In the long run, maturing of applied sciences similar to kiln electrification with renewable energy, carbon seize on course of emissions and hydrogen as excessive temperature gas will likely be important.
– Indian chemical & fertilizers trade is sixth largest globally and quickly rising at 10-15 per cent CAGR. This sector accounts for 12% of whole manufacturing emissions, primarily pushed by feedstock utilization (e.g. pure gasoline in ammonia) and utilities (warmth and energy). Fertilizers and Petrochemicals (particularly plastics) are the 2 chemical teams which have the best GHG depth. Adoption of renewable energy to switch coal-based electrical energy has already began within the sector. Incremental effectivity measures and enchancment in catalyst applied sciences are ongoing. Nonetheless, a step change in GHG emissions would require maturing three key applied sciences – inexperienced hydrogen for fertilizers feedstock, electrification of cracker furnaces for petrochemicals manufacturing, and deployment of round financial system fashions similar to recycling.
With greater than 60 massive Indian firms and several other multinationals working in India volunteering for SBTi (Science Primarily based Targets initiative) based mostly emissions discount targets, India’s industrial decarbonization plan is off to a great begin. However much more must be carried out. In probably the most important GHG emitting sectors, solely between a fifth and 1 / 4 of abatement wanted for 1.5 diploma Celsius targets could be achieved by way of present commercially viable applied sciences.
Key success components for India will embody the relative decline in price of decarbonized versus standard commodities, availability of sources (similar to biomass or geological space for storing for captured CO2), and the feasibility of adapting previous in addition to new amenities. Enabling the transition would require funding in R&D to make rising new applied sciences similar to hydrogen inexpensive, coverage help and incentives from authorities to steer trade in direction of sustainable applied sciences, and elevated international collaboration.
[This is the fourth in a ten-part series of articles spread over ten days of the global COP26 conference. It aims at providing a macro perspective on how a green, low-carbon transition can transform and revitalize every part of India’s economy. This piece was authored by Sudeep Maheshwari, Partner and Leader, Kearney’s India Energy and Process Industries Practice]
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