India is making strides towards decarbonising its steel sector. The unveiling of the Green Steel Taxonomy marks a very important moment in this journey. This initiative aligns with India’s commitment to achieve net-zero emission intensity by 2070. The event took place on 12th December 2024, led by Union Minister of Steel and Heavy Industries, Shri H D Kumaraswamy. Key stakeholders from various sectors were present, including government officials, industry representatives, and international delegates.
About Green Steel Taxonomy
The Green Steel Taxonomy defines what constitutes green steel. It sets emission intensity thresholds for steel production. The baseline is established at 2.2 tonnes of CO2 equivalent emissions per tonne of finished steel. Steel plants producing below this threshold can be rated based on their emission intensity.
Rating System for Green Steel
The taxonomy introduces a star rating system. – Five-star green-rated steel – Emission intensity lower than 1.6 t-CO2e/tfs. – Four-star green-rated steel – Emission intensity between 1.6 and 2.0 t-CO2e/tfs. – Three-star green-rated steel – Emission intensity between 2.0 and 2.2 t-CO2e/tfs. Steel exceeding 2.2 t-CO2e/tfs is ineligible for a green rating. This system encourages steel plants to innovate and reduce emissions.
Scope of Emissions
The taxonomy covers various emission scopes. Scope 1 and Scope 2 emissions are included. Limited Scope 3 emissions are considered too. These encompass emissions from processes like agglomeration and beneficiation. However, upstream mining and downstream transportation emissions are excluded.
Measurement and Verification
The National Institute of Secondary Steel Technology (NISST) is designated as the nodal agency. NISST will handle measurement, reporting, and verification (MRV). It will also issue greenness certificates and star ratings annually. Steel plants can opt for more frequent MRV if needed.
Stakeholder Consultation and Future Plans
The event included consultations on the National Mission on Green Steel (NMGS) and the Green Steel Public Procurement Policy (GSPPP). The Ministry of Steel is open to suggestions from stakeholders for these initiatives. This collaborative approach aims to ensure the effective implementation of the green steel framework.
Commitment to Sustainability
The Ministry of Steel emphasises its dedication to sustainability and innovation. The green steel initiative is crucial for India’s steel industry. It aims to enhance global competitiveness while reducing carbon emissions. The success of this initiative relies on collaboration among all industry players.
Questions for UPSC:
- Critically analyse the impact of the Green Steel Taxonomy on India’s steel industry.
- What are the implications of emission intensity thresholds for global steel production? Discuss.
- Estimate the role of the National Institute of Secondary Steel Technology in promoting sustainable practices.
- Point out the key differences between Scope 1, Scope 2, and Scope 3 emissions in industrial contexts.
Answer Hints:
1. Critically analyse the impact of the Green Steel Taxonomy on India’s steel industry.
- Establishes clear emission intensity standards, promoting accountability.
- Encourages innovation in production methods to achieve lower emissions.
- Fosters a competitive market for low-carbon products, enhancing global competitiveness.
- Facilitates stakeholder collaboration for sustainable practices.
- Potentially increases costs for compliance but can lead to long-term savings and sustainability.
2. What are the implications of emission intensity thresholds for global steel production? Discuss.
- Sets a benchmark for countries to align with global sustainability goals.
- Encourages international collaboration and knowledge sharing in green technologies.
- May lead to increased investment in cleaner production technologies worldwide.
- Could create trade barriers for non-compliant nations, influencing global market dynamics.
- Promotes a shift towards circular economy principles in steel production.
3. Estimate the role of the National Institute of Secondary Steel Technology in promoting sustainable practices.
- Acts as the nodal agency for measurement, reporting, and verification (MRV) of emissions.
- Issues greenness certificates and star ratings, incentivizing compliance.
- Facilitates data collection and analysis to monitor industry progress.
- Provides guidance and support for industry stakeholders on sustainable practices.
- Ensures transparency and credibility in the green steel certification process.
4. Point out the key differences between Scope 1, Scope 2, and Scope 3 emissions in industrial contexts.
- Scope 1 – Direct emissions from owned or controlled sources (e.g., combustion in company facilities).
- Scope 2 – Indirect emissions from the generation of purchased electricity, steam, heating, and cooling.
- Scope 3 – Other indirect emissions not covered in Scope 2, including supply chain and product end-of-life emissions.
- Scope 1 and 2 are more straightforward to measure, while Scope 3 involves complex calculations.
- About all scopes is crucial for comprehensive emissions reduction strategies.
