Reducing Industrial Emissions in India

India’s efforts to enforce stricter industrial emission norms continue to face challenges, particularly in sectors such as power generation, steel, cement, and transportation. Recently, the government extended the compliance deadline for sulfur dioxide (SO₂) emission control in thermal power plants to December 2027, highlighting the difficulties in implementing pollution control measures.

The industrial sector contributes ~30% of India's CO₂ emissions, with power, steel, cement, and refineries as key polluters. Despite net-zero by 2070 and a 500 GW renewable target by 2030, challenges like fossil fuel dependency, slow clean-tech adoption, and weak regulations persist.

A comprehensive policy integrating carbon trading, green finance, and strict efficiency standards is crucial for India's low-carbon industrial transition.

Power Generation (Thermal Power Plants)

• The power sector is the largest contributor to industrial CO₂ emissions, with coal-based thermal power plants generating ~70% of India’s electricity.
• Coal combustion releases high levels of CO₂, sulfur oxides (SOₓ), nitrogen oxides (NOₓ), and particulate matter (PM2.5), causing severe air pollution and health hazards.
• Despite mandates for Flue Gas Desulfurization (FGD) to control SO₂ emissions, implementation has been delayed due to financial constraints and regulatory leniency.

Iron and Steel Industry

• India, the second-largest steel producer globally, relies heavily on coal-based blast furnaces, making the sector one of the highest carbon emitters.
  • The steel industry emits ~2.5 tonnes of CO₂ per tonne of steel produced.
  • High costs of transitioning to green hydrogen-based steel production.
  • Slow adoption of energy-efficient technologies like electric arc furnaces due to high electricity tariffs.

Cement Industry

• Cement production contributes ~8% of global CO₂ emissions, mainly due to the calcination process, where limestone releases CO₂.
  • High dependency on coal-based kilns for clinker production.
  • Limited adoption of low-carbon alternatives like fly ash-based cement.
  • High cost of carbon capture and storage (CCS) technologies.

Oil and Gas Industry (Refineries & Petrochemicals)

• The refining sector contributes significantly to methane leaks and CO₂ emissions, particularly in crude oil processing.

Fertilizer Industry

• Nitrous oxide (N₂O) emissions from fertilizer production contribute to global warming, with a climate impact 300 times greater than CO₂.

Transport & Automotive Industry

• Road transport accounts for 12% of India's total CO₂ emissions, driven by rising vehicle ownership and increasing freight demand.

Read This Article Here: Strengthening India's Environmental Governance

Heavy Reliance on Coal-Based Energy

• India's industrial sector depends significantly on coal for electricity and high-temperature processes.
• Sectors like steel, cement, and aluminum continue to use coal as it is the cheapest and most accessible fuel option.
• In November 2024, the government sanctioned 36 new coal projects to meet rising energy demands, highlighting continued reliance on fossil fuels.

High Cost of Clean Technologies

• Transitioning to cleaner technologies like carbon capture, green hydrogen, and energy-efficient processes is slow due to high initial investment costs.
• Green hydrogen remains expensive at ₹350-400/kg, limiting its large-scale industrial adoption.
• MSMEs struggle with upfront capital investment, despite long-term savings from cleaner energy.
• Technologies such as Flue Gas Desulphurisation (FGD) in thermal plants and electrification of steel production remain underutilized due to financial constraints.
• Despite rapid growth in renewable energy, challenges like grid integration, transmission bottlenecks, and lack of industrial-scale storage hinder widespread adoption.

Weak Regulatory Enforcement and Policy Dilutions

• Environmental regulations are often delayed, diluted, or inconsistently implemented, weakening their impact.
• Industries exploit regulatory loopholes and compliance delays to avoid investing in clean technologies.
• Pollution control boards face limitations in monitoring and penalizing violations due to inadequate resources.
  • Example: The deadline for SO₂ emission compliance was extended to 2027, postponing clean air benefits.

Limited Financial Incentives for Decarbonization

• Though initiatives like PAT (Perform, Achieve, and Trade) and carbon trading markets exist, industries lack adequate financial support.
• Green financing options remain scarce, and banks hesitate to invest due to uncertain returns.
• Low carbon credit prices (₹300-600 per tonne) provide insufficient incentives for industries to cut emissions.

Inefficiencies in Industrial Processes

• Many industries operate with outdated, inefficient machinery, leading to high energy consumption and emissions.
• Aging thermal power plants from the 1990s suffer from declining efficiency.
• Retrofitting old plants is costly, leading industries to prioritize production over efficiency improvements.
• Waste heat recovery, cogeneration, and low-carbon manufacturing techniques remain underutilized due to lack of awareness and technical expertise.

Slow Progress in Circular Economy & Waste Management

• Industrial waste recycling and reuse remain underdeveloped, increasing raw material demand and emissions.
• Many industries fail to adopt circular economy principles, leading to excessive resource extraction and waste generation.
• India produces 4.43 million tons of hazardous waste annually, but only 71,833 tons are classified as incinerable.
• Only 21% of India's steel production is based on recycled scrap, limiting resource efficiency.

Socioeconomic Trade-Offs in Industrial Decarbonization

• Balancing economic growth, job creation, and emission reduction presents a significant challenge.
• Emission-intensive industries serve as major employment generators, making strict environmental policies politically sensitive.
• A just transition framework is necessary to mitigate workforce resistance to cleaner technologies.
• Around 3.6 million people are directly or indirectly employed in the coal mining and power sectors, making the shift to clean energy complex.

Read This Article Here: Climate Change: Catalyst for India's Green Economy Transition

Strengthening Carbon Pricing and Emission Trading

• India should implement mandatory carbon pricing with stringent cap-and-trade regulations to ensure emissions reduction.
• Expanding the carbon credit trading scheme to more industries and integrating it with global markets will enhance effectiveness.
• Higher carbon pricing will encourage industries to adopt cleaner fuels, energy efficiency, and carbon capture.
• The government must enforce penalties for non-compliance to deter industries from paying low fines instead of cutting emissions.

Expanding Green Hydrogen and Biofuel Ecosystem

• Scaling up green hydrogen production through policy incentives and public-private partnerships can decarbonize steel, cement, and fertilizer sectors.
• Increasing biofuel and compressed biogas (CBG) adoption under the SATAT scheme will reduce fossil fuel dependence in transport and refining.
• These clean alternatives require low-cost financing to encourage industrial adoption.

Faster Adoption of Circular Economy in Manufacturing

• India must enforce strict Extended Producer Responsibility (EPR) for industries like steel, cement, textiles, and e-waste.
• Promoting industrial symbiosis, where waste from one industry is repurposed as raw material for another, can cut emissions.
• Setting material recovery targets under frameworks like ZED (Zero Defect, Zero Effect) will promote sustainable manufacturing.
• Establishing recycled material marketplaces will enhance supply chain efficiency and lower raw material demand.

Decarbonizing Thermal Power Plants through Rapid FGD and CCS Deployment

• India must enforce Flue Gas Desulphurisation (FGD) installation in coal-fired power plants and accelerate Carbon Capture and Storage (CCS) deployment.
• Setting up carbon utilization hubs to repurpose captured CO₂ for chemicals, synthetic fuels, and construction materials can improve feasibility.
• Retrofitting old coal plants with supercritical technology will increase efficiency and lower emissions.
• Incentivizing coal gasification and hybrid power models (coal + renewables) will aid the transition.

Strengthening Industrial Energy Efficiency Standards

• Expanding the Perform, Achieve, and Trade (PAT) Scheme to cover more industries with sector-specific efficiency benchmarks is essential.
• Making Energy Conservation Building Code (ECBC) compliance mandatory for factories will boost adoption of energy-efficient solutions.
• MSMEs should receive subsidized access to energy-efficient machinery and digital monitoring tools under schemes like Technology Upgradation Fund (TUF).

Accelerating Renewable Energy Adoption in Industries

• Industries must be incentivized to shift to captive solar, wind, and hybrid renewable energy solutions.
• Expanding Open Access Renewable Energy Policies will allow industries to procure green power at lower tariffs.
• Faster battery storage deployment through viability gap funding will enhance renewable energy reliability.

Developing Low-Carbon Transport and Green Logistics

• To decarbonize freight transport, industries must transition to electric and hydrogen-powered trucks.
• Enhancing the Dedicated Freight Corridor (DFC) and shifting goods movement to rail will significantly reduce emissions.
• Expanding green shipping initiatives and mandating zero-emission warehouses will further cut supply chain emissions.
• Rail electrification should be linked with industrial transport policies for a synchronized transition.

Ensuring Just Transition for Coal-Dependent Industries

• While shifting to clean energy, India must implement a Just Transition framework to protect coal-dependent workers and communities.
• A national Reskilling and Green Jobs Program can train workers in solar, hydrogen, and EV technology.
• Industrial zones should be repurposed into clean energy and sustainable manufacturing hubs to ensure regional economic stability.

Strengthening Waste-to-Energy and Industrial Waste Management

• Expanding waste-to-energy plants, bio-CNG production, and industrial waste valorization can cut methane and CO₂ emissions.
• Implementing zero landfill policies for large industries will push sectors toward closed-loop production.
• Incentivizing biodegradable alternatives and chemical recycling in plastic-heavy industries will lower emissions.
• Industries should be required to use certified green packaging to reduce waste at the source.

India’s industrial growth must align with its climate commitments, requiring a shift towards low-carbon energy sources, energy efficiency improvements, and stringent emission controls. While challenges persist, global best practices, emerging green technologies, and policy interventions offer viable pathways for reducing carbon emissions. A balanced approach that ensures economic competitiveness while achieving sustainability goals is essential to drive India’s industrial sector toward a greener future.

What are the three types of emissions?

• Scope 1: Direct emissions from sources owned or controlled by an entity (e.g., fuel combustion in industries).
• Scope 2: Indirect emissions from purchased electricity, steam, or heat.
• Scope 3: Indirect emissions from the entire value chain, including raw materials, logistics, and product use.

How do industrial emissions affect climate change?

• Industries release CO₂, CH₄, and N₂O, which trap heat in the atmosphere, intensifying the greenhouse effect and worsening climate extremes.

What is the largest source of emissions in India?

• The energy sector, mainly due to fossil fuel combustion, is the highest emitter, contributing significantly to CO₂ emissions.

What is the most polluting industry?

• The fossil fuel-based energy sector is the most polluting, as coal, oil, and gas combustion releases large amounts of greenhouse gases.

Ace your Prelims preparation🚀

Practice unlimited year-wise, subject-wise PYQs here.