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India Heavy Industry

Focusing on heavy industry sectors is vital to India reaching its climate goals

19 December 2020, 5:06 GMT 4 min read

Avinash Acharya, Manager Energy Transitions and Zainab Agha, Project Coordinator - Government Relations

The heavy industry sectors are some of the biggest contributors to carbon emissions today. They have also been a key player in ensuring job security and enabling India to be one of the fastest growing economies in the world. For India to continue to meet our goals under the Paris Agreement, it is vital that we bring focus to pathways to decarbonise now while ensuring green growth and development.

As part of our work in India, we set out to scope the situation across industry players and civil society and build a clear narrative on where we are now and what our priorities should be in the next decade. Our conversations brought out the key facets on deep decarbonisation of these sectors. It is also an opportunity to kickstart our efforts in building clear roadmaps by identifying what needs to be done and who needs to lead it. 

Voices from businesses

Businesses are at the centre of this story. When we spoke to key business representatives from the iron and steel, cement and chemicals sectors, we found that despite their focus on growth as per business-as-usual, they were also aware of the gains in innovative, green and functional solutions that bring down emissions while maintaining their operations.

Businesses were keen to know:

  • What is possible to achieve through best available technologies and how far will that take them in the next 5-10 years
  • What could be the transformational technologies that can help achieve deep decarbonization and what we need to do now to have a seamless transition later

While we observed some sectoral nuances in the responses to these questions, the steel, cement and chemicals sector all have the same story. All three sectors understand that the best available technologies on improving energy efficiency, demand management and material circularity are beneficial for the bottom line with fast returns on investment. Positively, the government is also pushing for more action through instruments such as PAT scheme.

Second, early investments in R&D and pilots of deep decarbonization technologies are necessary in emerging solutions such as Carbon Capture Utilization and Storage (CCUS) and Hydrogen (especially green-field hydrogen produced from electrolysis).

Finally, we found that the market for heavy industry being largely domestic and there is much to be done in creating awareness initially for low/zero carbon products. Companies are increasingly adopting tools such as internal carbon pricing that help in creating small pools of investments in decarbonization projects. However, for scale up to happen more financing and policy support needs to be unlocked.

K N Rao, Former Director, Energy, Environment and Sustainability, ACC Limited, said, “Accessing technology, finance, and positive policy signals is key for the heavy industry to make the fast moves. The government must push for accountability from industries such as green labelling, where industries are responsible and customers aware."

Voices from civil society

Civil society organisations in India are playing an important role in closing the gaps in implementation and policy to catalyse emission reductions in the short, medium and long term. Experts from organisations are in the position to offer technical and systemic knowhow to advice and support both policy makers and industry executives to decarbonise their industries.

From the perspective of civil society, we found that: research and capacity building are crucial to stepping up action from heavy industries.

  • Why research: The heavy industry sectors continue to be primarily dependent on energy from fossil fuels. To transition this to clean and efficient energy consumption, we need to scale projects that are guided by research and the use cutting-edge technologies. Right now, we have limited strategies that specifically focus on decarbonisation of heavy industry at the national level. Creating policies that are backed by research and development can make adopting decarbonisation pathways easier and more accessible.
  • Why capacity building: For change to take place, and at such a large scale, we need resources and skills that would accelerate the adoption of technologies and processes that drive deep decarbonisation. We know that India is ripe with talent and there is a huge demand for skilled labour – focusing on training and capacity building based on contemporary green practices will open opportunity for growth and well as position India as a leader in driving world-class efforts. 

“India needs to domestically support its industry. A big opportunity is in collaboration towards building the capacity of public sector companies to build awareness on the tools and technologies available and be the first movers for mass adoption."

Kundan Burnwal, Advisor - Climate Change, Environment, Climate Change and Natural Resource Management Programme, GIZ India

India is well on the path in reaching our climate goals under the Paris Agreement. The economic standstill due to the COVID-19 pandemic saw sharp reductions in emissions in the short term. However, as we move towards recovery and growth, we will once again experience increasing emissions and will have to consider what we can do, and soon, to maintain and reduce emissions.

Our efforts have just begun. Over the next years, we are committed to drive meaningful action towards deep decarbonisation of the steel, cement and chemical industries in India by strengthening the narrative to support decision-making and action, developing strategies and roadmaps to cut industry emissions and promote the need for a collective and diverse array of advocates for change.

With 2021 just around the corner, it is imperative that Indian government and business leaders make bold moves in the hardest to abate sectors bolster our efforts in the next decade.  

Click here to watch the full workshop on “Decarbonisng the heavy industry sectors”.