Pioneering Green Steel: India’s New Framework

India reached a significant milestone in its commitment to decarbonizing the steel sector and transitioning toward a low-carbon economy. Shri H.D. Kumaraswamy, Union Minister of Steel & Heavy Industries, officially released India’s first-ever Taxonomy of Green Steel during an event at Vigyan Bhavan in New Delhi. The release of this framework positions India as a global leader in defining and advancing green steel production, a sector crucial to achieving the nation’s environmental and sustainability targets.

Key Highlights of the Green Steel Taxonomy Release

Historical Significance

• India becomes the first nation to unveil a formal taxonomy for green steel.
• The taxonomy aligns with India’s commitment to achieving net-zero emission intensity by 2070, as part of the larger transition to a low-carbon economy.

Objectives of the Green Steel Taxonomy:

• To define “green steel” and promote innovation in steel production.

• To create a market for low-carbon steel products, facilitating the industry’s growth while reducing emissions.
• To guide the steel sector towards achieving a substantial reduction in CO2 emissions intensity.

Salient Features of the Green Steel Taxonomy

Definition of Green Steel

• Green Steel is characterized by the emission intensity of less than 2.2 tonnes of CO2e per tonne of finished steel (tfs).
• The “greenness” of steel is expressed as a percentage, based on how much lower the emission intensity is compared to the 2.2 t-CO2e/tfs threshold.

Green Steel Star Rating System

• Five-Star Rating: Steel with emission intensity lower than 1.6 t-CO2e/tfs.
• Four-Star Rating: Steel with emission intensity between 1.6 and 2.0 t-CO2e/tfs.
• Three-Star Rating: Steel with emission intensity between 2.0 and 2.2 t-CO2e/tfs.
• Non-Green Steel: Steel with emission intensity above 2.2 t-CO2e/tfs is ineligible for green rating.

Emission Scope and Monitoring

• The scope of emissions includes Scope 1, Scope 2, and limited Scope 3 emissions (such as agglomeration and beneficiation processes), but excludes upstream mining, downstream emissions, and transportation emissions.
• The National Institute of Secondary Steel Technology (NISST) will serve as the nodal agency for measurement, reporting, and verification (MRV), and issuing the green certification and star ratings.

Frequency of Certification

• The green certification for steel plants will be issued on an annual basis, with the possibility of more frequent updates depending on the plant’s reporting and verification processes.

Review and Adaptation

• The star rating thresholds will be reviewed every three years to ensure they remain aligned with technological advancements and emission reduction goals.

Additional Stakeholder Consultation

• During the event, consultations were also held on the draft National Mission on Green Steel (NMGS) and Green Steel Public Procurement Policy (GSPPP).
• The Ministry of Steel assured that inputs from stakeholders would be incorporated to finalize these documents, ensuring broad-based support and inclusivity.

Summary/Static	Details
Why in the news?	India becomes the first country to release a formal Green Steel Taxonomy.
Main Announcement	Unveiling of India’s first-ever Green Steel Taxonomy
Significance	India becomes the first country to release a formal Green Steel Taxonomy, aiming to decarbonize the steel sector and achieve a low-carbon economy transition.
Purpose of Taxonomy	To define green steel, reduce CO2 emissions, foster innovation, and create a market for low-carbon steel products in India.
Green Steel Definition	Steel produced with CO2 emissions lower than 2.2 tCO2e per tonne of finished steel (tfs).
Star Rating System	– Five-Star: Emission intensity < 1.6 tCO2e/tfs – Four-Star: Emission intensity between 1.6 and 2.0 tCO2e/tfs – Three-Star: Emission intensity between 2.0 and 2.2 tCO2e/tfs – Non-Green: Emission intensity > 2.2 tCO2e/tfs
Review Frequency for Rating	Every three years
Scope of Emissions	Includes Scope 1, Scope 2, and limited Scope 3 (agglomeration, beneficiation, and embodied emissions in raw materials).
Nodal Agency	National Institute of Secondary Steel Technology (NISST)
Certification Frequency	Annually, with possibility for more frequent updates based on plant reporting.