Decarbonization of Indian Industrial Sector - 12 Mar 2022

Decarbonization of Indian Industrial Sector (Highlights of the Publication)

Disclaimer:

© 2022,

Confederation of Indian Industry

All Rights reserved.

This report is a part of CII - Godrej GBC effort to look at possible road map for decarbonization of Indian Industrial sector, supported by Danfoss. The document estimates the emission reduction possible for the industrial sector based on study of 5 major sectors – Cement, Iron and Steel, Paper and Pulp, Textile and Chemicals.

The views/analysis expressed in this report do not necessarily reflect the views of CII and Danfoss. CII and Danfoss do not guarantee the accuracy of any data included in this publication nor does it accept any responsibility for the consequences of its use.

While every care has been taken in compiling this publication, CII- Godrej GBC and Danfoss does not accept any claim for compensation, if any entry is wrong, abbreviated, omitted or inserted incorrectly either as to the wording space or position in the Document.

An Initiative Supported by Danfoss Industries Pvt. Ltd.

Table of Contents •

Decarbonization of Industrial Sector, Its relevance in Indian Context

•

India’s Primary Energy Consumption Profile

•

India’s Emission Profile

•

Analysis of Analysis – Leading Report on India’s Decarbonization or Low Carbon Approach

•

Analysis of Analysis – Conclusions from the 3 reports

•

Strategies and actions towards Decarbonization by various corporates in the country •

Corporate and Company Level Initiatives for Decarbonization – Examples

•

Summary of Results from Analysis of 5 Selected Sectors

•

Decarbonization Pathways for Indian Industrial Sector (5 selected sectors)

•

•

Indian Steel Sector

•

Cement Sector

•

Paper Sector

•

Textile Sector

•

Chemical Sector

Conclusions •

Key impact technologies

•

Technological Road Map for Decarbonization

•

Investment Required for Key Technologies

•

Levers for decarbonizing Indian Industrial sector

•

Interventions for Accelerating Decarbonization

Key Messages from the Publication Key Message 1: India has not only made strong Commitments towards Decarbonization but also has achieved significant results through various efforts Key Message 2: India’s journey towards Net Zero would be challenging as India’s GHG Emissions Itself would be peaking by 2040 s – Further Mitigation required to become NetZero by 2070 will be exponentially higher than historic performance Key Message 3: Voluntary Actions of these companies can result to an additional GHG emissions reduction of up to 1.95%, if followed by entire industrial sectors this can result in overall reduction of almost 5.6% of overall GHG emissions Key Message 4: Estimated Emission Reduction for entire Industrial Sector in Business as Usual and Deep Decarbonization could be around 15.47% and 29.01% respectively Key Message 5: Industrial Decarbonization -Energy Efficiency will play a major role by contributing 44% in BAU and 32% in Deep Decarbonization Scenario Key Message 6: Iron and Steel one of the hardest to abate sectors could reduce its emissions intensity by 16 % in BAU scenario and 24% in Deep Decarbonization ScenarioKey Decarbonization Summary

4

Messages from the Publication Key Message 7: Energy Efficiency, Material Circularity and Renewable Energy are the top levers contributing 40%, 30% and 20% respectively in Deep Decarbonization Scenario Key Message 8: Cement Sector – One of the most progressive sectors in the Indian Industrial sectors can reduce its overall emissions by 13.4% and 30.3% in BAU and Deep Decarbonization scenarios Key Message 9: Circularity and Material Efficiency Measures like Improving Clinker factor improvement, increasing additives in overall cement manufacturing will play a huge role in decarbonization efforts for Cement Sector (33% in BAU and 28% in Deep Decarbonization Pathways) Key Message 10 : Paper is one of the sector which has a huge potential in terms of becoming carbon neutral in near future. Some of the Indian companies like ITC PSPD, SPB are already Carbon Positive Key Message 11 : Energy Efficiency remain to play an important role in the overall Paper and Pulp sector decarbonization. Energy Efficiency lever can contribute to around 62% reduction in BAU Scenario and around 36% in Deep Decarbonization Scenario for decarbonization journey of paper sector Decarbonization Summary

5

Key Messages from the Publication Key Message 12: Energy Efficiency and Biomass Utilization will play an important role in Textile Industry Decarbonization While Energy Efficiency can contribute to 53 % in BAU Scenario and 46 % in deep decarbonization Scenario, Biomass and utilization of other cleaner fuels, could further contribute to 29% in BAU scenario and 25 % in Deep Decarbonization Scenario Key Message 13: Chemical sector has significant amount of process emissions making it really challenging to decarbonization, to further accelerate decarbonization Hydrogen and CCUS will have to play a very significant role in overall Decarbonization of this sector Key Message 14: Many of the futuristic technologies like Hydrogen, CCUS, Fuel Cells etc. are still in their nascent stages with high-cost implications, On one hand these technologies require a huge push on the policy front, but the Industry leaders also need to come forward and demonstrate its commitment towards adoption of these

Decarbonization Summary

6

Decarbonization of Industrial Sector, Its relevance in Indian Context

Paris Agreement 2015 Member Countries adopted target limiting the overall temperature rise to below 2 Deg C (preferable 1.5 Deg C) compared to preindustrial levels 33-35 % reduction in emission intensity of its GDP by 2030 from 2005 levels 40% of its installed capacity to be renewable (or nuclear) by 2030 India also plans to increase its tree cover to create an additional cumulative sink of 2500 MtCO2e by 2030

Decarbonization Summary

7

India’s 5 Commitment ‘Panchamrit’ made at COP26

India will achieve Net Zero by 2070

India will bring itsnon-fossil energy capacity to 500 GW by 2030 India will bring its economy’scarbon intensity down to 45 per cent by 2030

M Narendra Modi at the COP26 summit in Glasgow on 1 November 2021

India will fulfill50 per centof itsenergy requirement through renewable energy by 2030 India willreduce 1 billion tons of carbon emissionsfrom the total projected emissionsby 2030

Decarbonization Summary

8

Decarbonization of Industrial Sector, Its relevance in Indian Context – Primary Energy Consumption Profile Primary Energy Consumption already doubled since 2000’s (from 440 Million TOE to 880 Million TOE

Expected to again double in the next 20 years to around 1900 Million TOE , 1500 Million TOE by 2030 itself

Despite the increase in absolute numbers –the per capita energy demand is only 36% of world average and Energy Intensity has also increased

Decarbonization Summary

9

Decarbonization of Industrial Sector, Its relevance in Indian Context – Primary Energy Consumption Profile

India’s Net GHG Emissions increased by more than 50% from 2005 levels

India has already achieved its emission intensity of GDP reduction target for 2020-21 of 24%

India’s per capita CO2 emissions at 1.6 tons of CO2 are well below the world average of 4.4 tons of CO2

India historically also has much lower cumulative CO2 emissions (1750 onwards -US –25% , EU –28%, China –13% , India –3%)

Decarbonization Summary

10

Decarbonization of Industrial Sector, Its relevance in Indian Context – Emission Profile (2016 – Biennial Report) Sector

CO2 Equivalent Emissions (billion Tons)

Energy

2.129

IPPU

0.226

Agriculture

0.408

LULUCF

-0.307

Waste

0.075

Total without LULUCF Total with LULUCF Estimated Industrial Emissions *

2.83 2.53

1.194 Billion Tons

* Including Emissions from Industrial Electricity Consumption from energy subsection, manufacturing and industries emission from energy subsection, IPPU, this includes refinery but excludes manufacturing of solid fuels

Decarbonization Summary

11

Key Message

“India has not only made strong Commitments towards Decarbonization but also has achieved significant results through various efforts”

Decarbonization Summary

12

Analysis of Analysis – Leading Report on India’s Decarbonization or Low Carbon Approach

Decarbonization Summary

13

Analysis of Analysis – Conclusions from the 3 reports

India’s emission to peak around 2040

Primary Energy demand expected to be on rise and may double by 2040

India’s net zero emissions pathways will be challenging as the rate of decrease of emissions required to achieve the net zero by 2050 onwards will have to be exponentially high compared to historic trends

Net Zero till 2050 – challenging in BAU scenario •

Decarbonization Summary

Mitigation needed to achieve net zero exponentially higher than historic performance

Renewable Energy & Energy Efficiency play important role •

RE deployment expected to double (or even triple)

•

30% of industrial emission mitigation - dependent on EE measures

Overall, all the pathways leading to net zero need to have huge investments made into some of the key technologies like CCUS, Energy Storage, Waste Heat Recovery etc.

14

Key Message “India’s journey towards Net Zero would be challenging as India’s GHG Emissions Itself would be peaking by 2040s – Further Mitigation required to become NetZero by 2070 will be exponentially higher than historic performance”

Decarbonization Summary

15

Strategies and actions towards Decarbonization by various corporates in the country

Potential Impact of Corporate Climate Action in India Selected Companies – 50 companies selected across various energy intensive and non intensive sectors such as Engineering, Metals, Pulp and Paper, Chemicals, Fast Moving Consumer Goods (FMCG), Services and Cement sectors

Analysis of 50 Companies from various sectors

Sector-wise contribution as a percentage of the total emissions reduction impact of the 50 companies in 2030 Decarbonization Summary

17

GHG Reduction Trend for Selected 50 Companies

Fig Shows the annualized reduction in GHG emission intensity for the companies included in the analysis (grouped by sectors)

Annualized GHG intensity reduction ranging from 1.24% to 9.44 %

Decarbonization Summary

•

Cement – 1.24 %

•

Chemicals and FMCG – 4 %

•

Engineering – 5.48 %

•

Metals, Paper and Pulp – 3.02%

•

Oil and Gas – 1.60 %

•

Services – 9.44 %

Reduction for energy intensive sectors shows lower GHG reduction compared to non energy intensive sector

18

Aggregate impact of voluntary climate initiatives by Indian companies Year

Total Emissions in Reference Scenario (MT CO2e)

Total Emissions with Impact of Voluntary Initiatives (MT CO2e)

Emissions Reduction Impact (MT CO2e)

Emissions Reduction Impact (%)

2020

312.53

294.54

17.99

5.76%

2030

689.40

599.52

89.88

13.04%

Voluntary Actions of these companies can result to an additional GHG emissions reduction of up to 1.95 %, if followed by entire industrial sectors this can result in overall reduction of almost 5.6% of overall GHG emissions Decarbonization Summary

19

Corporate and Company Level Initiatives for Decarbonization - Examples

Corporate/ company level initiatives for decarbonization – Example (JSW Steel Ltd.) JSW Steel limited

Decarbonization Summary

JSW Steel and its subsidiaries together account for ~23% of India’s steel production

Internal Carbon Price - JSW Steel has adopted a shadow internal carbon price of USD 20/ton

Targets for a better tomorrow! - JSW Steel, as well as JSW Energy, has set-up long term internal targets for all the sustainability KPIs across all locations

JSW Steel, due to its consistent and comprehensive CO2 emissions data disclosure, has also been ranked 1 by the CDP Steel Report 2019 in the Data Transparency rankings.

JSW Steel Company-wide target for specific energy/consumption for 2030 5.91 (GCal/tcs) Company-wide target for specific GHC emmissions for 2030 (tCO2e/ 2.00 tcs) Company-wide target for specific freshwater consumption for 2030 2.41 (m3/tcs) Company-wide target for waste 100.00 recycling for 2030 (%) To achieve a ‘no net loss’ of biodiversity at all our currently operating sites by 2030

21

Corporate/ company level initiatives for decarbonization – Example (Dalmia Cement (Bharat) Ltd.) Dalmia cement (Bharat) Limited

First heavy-industry globally to announce carbon negative targets •

Decarbonization Summary

Aiming to become carbon negative by 2040

Ranked 1st in global cement sector by CDP on business readiness for a lowcarbon economy transition

Usage of 100% renewable power under fossil free electricity initiative - 2030 (RE 100)

1st Cement Company to Join – EP 100 and RE100 •

Double energy productivity - 2030 (EP 100)

•

Carbon Capture and Utilisation (CCU) for process emissions & Carbon Sequestration - 2040

22

Corporate/ company level initiatives for decarbonization – Example (ITC PSPD) ITC PSPD

Decarbonization Summary

Carbon positive (15 consecutive years)

Renewable energy share – 48%

Water positive (18 consecutive years), 26.5% reduction in specific GHG intensity in last 3 years

3 times carbon positive

Green cover for over 8,00,000 acres of land

Targets committed (by 2028-29 - baseline 2018 -19) •

27% reduction in SEC

•

14% increase in RE share

•

47% reduction in GHG intensity

•

36% reduction in specific water consumption

23

Corporate/ company level initiatives for decarbonization – Gujarat Fluorochemicals Ltd. and Tata Chemicals

Decarbonization Summary

Gujarat Fluorochemicals Ltd & Tata Chemicals are a part of the 1000+ companies registered under SBTi

24

Key Message “ Voluntary Actions of these companies can result to an additional GHG emissions reduction of up to 1.95%, if followed by entire industrial sectors this can result in overall reduction of almost 5.6% of overall GHG emissions ”

Decarbonization Summary

25

Key Message

“Estimated Emission Reduction in Business as Usual and Deep Decarbonization could be around 15.47% and 29.01% respectively”

Decarbonization Summary

26

Key Message

“Energy Efficiency will play a major role by contributing 44% in BAU and 32% in Deep Decarbonization Scenario”

Decarbonization Summary

27

Decarbonization pathways for Indian Steel Sector

Estimated Steel Production: Crude Steel Production (million tons)

Decarbonization Summary

29

Estimated Specific Energy Consumption (Projected Scenarios) in GCal/TCS

Decarbonization Summary

30

Estimated Crude Steel Production (BF-BOF, EAF-IF route)

Decarbonization Summary

31

Estimated Projections - Impact of Various Levers

* Low Demand Scenario Decarbonization Summary

32

Decarbonization Conclusion for Iron and Steel Sector

Decarbonization Summary

Implementation of Best Available technologies can help the iron and steel sector to reduce the overall GHG emissions by 9.6% in deep decarbonization scenario

Many of the technologies are still not commercialised yet, and further need huge impetus in form of R&D, Investment and Financing support from both governments as well as private players for them to mature soon enough to add further pace to overall decarbonization process

Energy Efficiency (40%), Circularity and Material Efficiency (30%), Renewable Energy (20%) will play a major role in the overall decarbonization of Iron and Steel Sector (Deep Decarbonization)

Scrap Utilization (Circularity and Material Efficiency) has a huge scope with expected scrap utilization of more than 50 million tons by 2030

CCUS and Green Hydrogen have great potential but due to lack of commercialised technology and high costs their impact seems to be less but that would increase after 2040s

33

Key Message

“ Iron and Steel one of the hardest to abate sectors could reduce its emissions intensity by 16 % in BAU scenario and 24% in Deep Decarbonization Scenario”

Decarbonization Summary

34

Key Message

“Energy Efficiency, Material Circularity and Renewable Energy are the top levers contributing 40%, 30% and 20% respectively in Deep Decarbonization Scenario”

Decarbonization Summary

35

Decarbonization pathways for Cement Sector

Estimated projections: cement production (million tons)

Cement production : Estimates CII Database Decarbonization Summary

37

Estimated projections: Clinker Production (Million Tons)

Decarbonization Summary

38

Estimated projections: emission intensity (Tons of CO2/ ton of cement)

Decarbonization Summary

39

Estimated projections: Emission (Million Tons of CO2)

Decarbonization Summary

40

Estimated projections: SEC Projection

Thermal SEC

Decarbonization Summary

Electrical SEC

41

Baseline Vs Deep Decarbonization – Emission Intenisty

Decarbonization Summary

42

Estimated Projections - Impact of Various Levers

Decarbonization Summary

43

Decarbonization Conclusion for Cement Sector

Decarbonization Summary

Energy Efficiency will play a lesser role in the cement sector as the sector has already matured enough, Already the sector with the help of various BATs in Energy efficiency has reduced its overall emission foot print from 1.12 tCO2/t of cement in 1996 to around to 0.67 tCO2/t of Cement in present levels

Advanced technologies remain to play an important role in the overall cement sector decarbonization but would need a bigger push from various stakeholders for deeper penetration

Circularity and Material Efficiency Measures like Improving Clinker factor improvement, increasing additives in overall cement manufacturing will play a huge role in decarbonization efforts ( 33% in BAU and 28% in Deep Decarbonization Pathways)

Electrification and Use of Renewable Energy will contribute to around 26% in BAU and 21% in Deep Decarbonization pathways. This would include utilization more clean energy from Solar PV plants and Wind based plants for reducing and offsetting fossil based power generations

The sector has already progressed well in the Alternate fuels department by increased utilization of MSW, RDF and other hazardous wastes and hence biomass and alternate fuels will contribute to 17% in BAU and 13% in Deep Decarbonization Pathways

44

Key Message

“Cement Sector – One of the most progressive sectors in the Indian Industrial sectors can reduce its overall emissions by 13.4% and 30.3% in BAU and Deep Decarbonization scenarios”

Decarbonization Summary

45

Key Message “Circularity and Material Efficiency Measures like Improving Clinker factor improvement, increasing additives in overall cement manufacturing will play a huge role in decarbonization efforts (33% in BAU and 28% in Deep Decarbonization Pathways)”

Decarbonization Summary

46

Decarbonization pathways for Paper Sector

Estimated projections – Paper production and par capita consumption

Decarbonization Summary

48

Estimated projections BAU Vs Deep Decarbonization - Emission Intensity

Decarbonization Summary

49

Estimated projections - Emission Intensity (Impact of Various Levers)

Decarbonization Summary

50

Decarbonization Conclusion for Paper and Pulp Sector

Decarbonization Summary

Paper is one of the sector which has a huge potential in terms of becoming carbon neutral in near future. Some of the Indian companies like ITC PSPD, SPB are already Carbon Positive – Carbon Sequestration through Tree Plantation being a major reason for the same

Energy Efficiency remain to play an important role in the overall paper and pulp sector decarbonization. Energy Efficiency lever will contribute to around 62% reduction in BAU Scenario and around 36% in Deep Decarbonization Scenario for decarbonization journey of paper sector

The sector has a huge potential of using clean fuels like biomass and that will contribute to around 18% reduction in BAU scenarios and 25% in Deep Decarbonization scenario

Recycled paper has a lower specific energy consumption when compared to the wood based or agro based paper production (almost 3 times lower in wood based and around 2.5 times lower in agro based). Increasing production and utilization of recycled paper can hence play an important role in overall decarbonization journey. Hence circularity and material efficiency will contribute 15 % in BAU and 17% in Deep Decarbonization Scenario

Many of the companies are already moving towards renewable energy like solar, wind for paper sector and this will play a role of around 5 % in BAU and 7% in Deep Decarbonization scenario

51

Key Message

“Paper is one of the sector which has a huge potential in terms of becoming carbon neutral in near future. Some of the Indian companies like ITC PSPD, SPB are already Carbon Positive”

Decarbonization Summary

52

Key Message “Energy Efficiency remain to play an important role in the overall paper and pulp sector decarbonization.

Energy Efficiency lever can contribute to around 62% reduction in BAU Scenario and around 36% in Deep Decarbonization Scenario for decarbonization journey of paper sector” Decarbonization Summary

53

Decarbonization pathways for Textile Sector

Specific Energy Consumption – Textile Industry Unit

SEC various sections Average

kWh/kg

5.375

kWh/kg

1.349

kWh/kg

0.461

kWh/kg

3.429

kcal/kg

1231.110

kWh/kg

2.126

kWh/kg

1.499

kcal/kg

7170.670

kWh/kg

1.714

kcal/kg

8564.530

Electrical UKG (Lycra Fabric)

kWh/kg

1.211

Thermal SEC (Lycra Fabric)

kcal/kg

4517.770

kWh/kg

1.007

kcal/kg

3630.360

Parameter Electrical UKG up to winding (Yarn-40s count) Electrical UKG (Open-end Yarn) Electrical UKG (Fiber Dyeing) Electrical UKG (Weaving)@ 60 PPI Thermal SEC (Weaving)@ 60 PPI Electrical UKG (Knitting) Electrical UKG (Cotton based fabric) Thermal SEC (Cotton based fabric) Electrical UKG (Polyester cotton based fabric) Thermal SEC (Polyester cotton based fabric)

Electrical UKG (Wool based fabric) Thermal SEC (Wool based fabric) Decarbonization Summary

55

Estimated Specific Energy Consumption (BAU Vs Deep Decarbonization)

Decarbonization Summary

56

Estimated projections – Emission Intensity (BAU Vs Deep Decarbonization)

Decarbonization Summary

57

Estimated Specific Energy Consumption – Impact of various Levers

Decarbonization Summary

58

Decarbonization Conclusion for Textile Sector

Decarbonization Summary

Energy Efficiency and Renewable Energy will play an important role in Textile sector’s overall Decarbonization journey.

Energy Efficiency will contribute to 53 % in BAU Scenario and 46 % in deep decarbonization Scenario

Renewable Energy will contribute to 18% in BAU Scenario and 29 % in deep decarbonization Scenario

The sector also has a significant potential in terms of Biomass and utilization of other cleaner fuels , this could further contribute to 29% in BAU scenario and 25 % in Deep Decarbonization Scenario

Both the scenarios – the latest technologies like CCUS, Hydrogen there is little or no significant contribution in this sector

59

Key Message “Energy Efficiency and Biomass Utilization will play an important role in Textile Industry Decarbonization While Energy Efficiency can contribute to 53% in BAU Scenario and 46% in deep decarbonization Scenario, Biomass and utilization of other cleaner fuels, could further contribute to 29% in BAU scenario and 25% in Deep Decarbonization Scenario” Decarbonization Summary

60

Decarbonization pathways for Chemical Sector

Estimated projections : (Soda Ash, Carbon Black and Ethylene Production – Million Tons)

Decarbonization Summary

62

Estimated emission intensity (Tons of CO2/ ton of soda ash): projected scenarios

Decarbonization Summary

63

Estimated emission intensity (Tons of CO2/ ton of Carbon Black): projected scenarios

Decarbonization Summary

64

Estimated emission intensity (Tons of CO2/ ton of Ethylene): projected scenarios

Decarbonization Summary

65

Estimated emission (Million Tons of CO2): Projected Scenarios

Decarbonization Summary

66

Estimated emission Projections – Selected Chemical Sector Combined

Decarbonization Summary

67

Decarbonization Conclusion for Chemical Sector

Decarbonization Summary

Chemical sector has significant amount of process emissions making it really challenging to move towards low carbon path or deep decarbonization

Because of the above reason energy efficiency and renewable energy (to certain extent ) are the only two major levers contributing in the business as usual scenario

To achieve higher emission reduction in the selected sector significant contribution should come from CCUS and Hydrogen as evident from the impact of levers in the deep decarbonization scenario

68

Key Message “Chemical sector has significant amount of process emissions making it really challenging to decarbonization, to further accelerate decarbonization Hydrogen and CCUS will have to play a very significant role in overall Decarbonization of this sector”

Decarbonization Summary

69

Summary of Results from Analysis of 5 Selected Sectors

Estimated Avoided Emissions from 5 Selected Sector from Baseline Year to Year 2040 Sector Name

Baseline Emissions

Emission in 2040 with no change in Emission Intensity

Emission in BAU sector (2040)

Emission in Deep Decarbonization Scenario (2040)

Million Tons of CO2

Decarbonization Summary

Baseline Vs BAU (Avoided Emission %)

Baseline Vs Deep Decarbonization (Avoided Emission%)

(Avoided Emission %)

(Avoided Emission %)

Cement Sector

220.43

378.44

327.61

263.78

13.43

30.30

Iron and Steel Sector

289.13

594.77

498.62

451.23

16.16

24.13

Paper and Pulp Sector

30.59

89.48

69.65

35.11

22.15

60.76

Textile Sector

18.46

39.86

32.05

29.44

19.58

26.14

Chemical Sector

33.51

74.68

66.87

54.42

10.46

27.13

Total Emissions

592.12

1177.22

994.81

833.98

15.49

29.16

71

Estimated Emission Reduction for Entire Industrial Sector

Decarbonization Summary

72

Decarbonization

Decarbonization Summary

Energy Efficiency will play a major role in the overall decarbonization journey of Indian Industrial sector, In BAU and Deep Decarbonization scenarios it contributes to around 45.9 % and 31% respectively to the overall reduction in GHG emissions. In terms of % contribution though there is reduction from Baseline to Deep Decarbonization scenario, but in absolute terms it still is contributing more than the baseline scenario

Because of the above reason energy efficiency and renewable energy (to certain extent ) are the only two major levers contributing in the business as usual scenario

To achieve higher emission reduction in the selected sector significant contribution should come from CCUS and Hydrogen as evident from the impact of levers in the deep decarbonization scenario

73

Conclusions

Impact on GHG Mitigation

Technology Penetration

Decarbonization of Indian Industrial sector – Key impact technologies

Futuristic Technologies < 2% penetration

Ex - Hydrogen, CCUS, Fuel Cells

Innovative and High Impact Technologies – 5% penetration

Ex – Low Temperature Waste Heat Recovery

Adoption of best Available technologies – 30% penetration

Ex – Coke Dry Quenching , Sinter waste heat recovery

Adoption of best Available technologies– 60% penetration

Ex – Automation, Industry 4.0

Best performers

Industry Leaders Average performers Rest of the industries

Traditional energy saving measures – 100% penetration

Ex – Energy Efficient Fans, Pumps, Motors

Futuristic Technologies – Require Significant Policy Push from government to reduce the cost of technology adoption , also the industry leaders and best performers need to show real commitment towards their adoption for the others to follow

Decarbonization Summary

75

Technological Road Map for Decarbonization

Adoption of best practices and Traditional Energy efficiency measures

Adoption of best Technologies (RE, WHR) New plants adopting energy efficiency by design Pilots and demonstration of H2, CCUS, Fuel Cells, Energy Storage

Adoption of H2, CCUS, Fuel Cells, Storage by selected units

Adoption of H2, CCUS, Fuel Cells, Storage by selected units

2015

Decarbonization Summary

2020

2025

2030

2035

2040

2050

76

Investment Required for Key Technologies

Decarbonization Summary

77

Key Message “ Many of the futuristic technologies like Hydrogen, CCUS, Fuel Cells etc. are still in their nascent stages with high-cost implications, On one hand these technologies require a huge push on the policy front, but the Industry leaders also need to come forward and demonstrate its commitment towards adoption of these technologies” Decarbonization Summary

78

Interventions for Accelerating Decarbonization

Strengthening PAT Scheme

Incorporating EE as a mandatory criteria in Public/ Industry Procurement guidelines

Promoting EE through Technology Innovations

Developing Ecosystem for EE Financing

Replicating Flexible RE policies in states

Strengthening REC Mechanism

Decarbonizing Coal based Power – Supercritical Power Plants, Biomass cofiring, phasing old and inefficient plants

Higher focus on electrification of key processes and technologies from various industrial sectors

Developing policies to promote Circularity and Resource Efficiency

Promoting Increased AFR in Cement, Scrap utilization in Steel Sector

Promoting Green Public Procurement

Extended Producers Responsibility

Creation of RE business models – RE products, services, efficient packaging

Tax Exemptions on recycled products and SOPs on Eco Labelled Products

Energy Efficiency

Electrification and Use of Clean Energy – Renewable Energy (Solar, Wind and others)

Circularity and Material Conservation

Decarbonization Summary

79

Interventions for Accelerating Decarbonization

Biomass, Hydrogen and Other Zero Carbon Fuels

Carbon Capture Utilization and Storage

Decarbonization Summary

Incentivizing Stakeholders like farmer, Poultry and Dairy industries, Municipalities for Biomass Utilization

Promoting Alternate Fuel Utilization, Biomass Cofiring

Promoting ethanol blending

Hydrogen – Tax Waivers for Electrolysers, electricity duty on RE for Hydrogen production

Promoting hydrogen blending in CNG

Carbon Pricing / Carbon Tax

Technology Transfer

R&D, Pilots

Suitable Carbon pricing mechanism to make CCS profitable

Policy level Interventions from government – subsidies etc.

Significant investment and financing by private sector

80

Confederation of Indian Industry The Confederation of Indian Industry (CII) is a non-government, not-for profit, industry-led and industry-managed organization, playing a proactive role in India’s development process. Founded in 1895, India’s premier business association has around 8000 members, from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 200,000 enterprises from around 240 national and regional sectoral industry bodies.

CII – Sohrabji Godrej Green Business Centre (CII – Godrej GBC), a division of Confederation of Indian Industry (CII) is India’s premier developmental institution, offering advisory services to the industry on environmental aspects and works in the areas of Green Buildings, Energy Efficiency, Water Management, Renewable Energy, Green Business Incubation and Climate Change activities. CII-Godrej GBC works closely with the stakeholders in facilitating India emerge as one of the global leaders in Green Business by the year 2022.

CII – Godrej GBC in association with Danfoss Industries Pvt. Ltd. as a part of this study looked at possible emission reduction of the Indian Industrial sector under various low carbon scenarios based on the various low carbon levers like Energy Efficiency, Electrification and Renewable Energy, Biomass and other zero carbon fuel utilization, Circularity and Material efficiency and Advanced Technologies like CCUS and others.

Danfoss Industries Pvt. Ltd. Danfoss has proven and reliable solutions to meet many of the climate, urbanization, and food challenges. Driven by the power of an electrified society and fuelled by the opportunities of going digital, Danfoss is dedicated to engineering solutions that can unleash the potential of tomorrow.

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Across the globe, Danfoss’s sustainable, smart technologies power industries and cities, secure a reliable food supply, and create healthier, more comfortable indoor climates. At the same time, Danfoss is also developing solutions that integrate renewables into tomorrow’s smart energy systems, where on- and off-highway machinery and shipping are powered by hybrid and electric motors.

This is where the transformation starts – in the way Danfoss can heat, cool, connect, and feed a growing population. Danfoss’s innovative engineering dates back to 1933. Today, Danfoss holds market-leading positions, employing 37,000 and serving customers in more than 100 countries.

For further information, kindly contact : P V Kiran Ananth, Senior Counsellor CII - Sohrabji Godrej Green Business Centre Survey No. 64, Kothaguda Post, Near Hitec City, Hyderabad.

TEL : +91 40 4418 5152 E-mail : kiran.ananth@cii.in