Facility for International Cooperation for
Inclusive & Sustainable Industrial Development

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CONSULTATION ON INDIA’S INDUSTRIAL DEEP DECARBONISATION INITIATIVE

October 2021 – January 2022: A series of three workshops, as part of the consultation on ‘India’s Industrial Deep Decarbonisation Initiative,’ were held from October 2021 to January 2022. The aim of the consultation was to raise awareness among various stakeholders in India on the industrial deep decarbonisation initiative (IDDI), and to discuss the barriers and needs to support India in meeting its global commitments at the global fora.

The Clean Energy Ministerial Industrial Deep Decarbonisation Initiative or IDDI was launched at the 12th meeting of the Clean Energy Ministerial in June 2021. It is a global coalition of public and private organisations who are working to stimulate demand for low carbon industrial materials including steel and cement. The initiative identifies Green Procurement as a key area of intervention where it will foster collaboration with national governments and various players to share best practices, develop guidelines and tools and work towards setting common procurement targets. Coordinated by UNIDO, the IDDI is co-led by the United Kingdom and India and its current members include Canada, Germany and United Arab Emirates (UAE).

The steel and cement industries are essential elements of the global economy and development aspirations. They provide key materials for buildings, infrastructure, and industry that can be used more efficiently but are also irreplaceable for key needs for the foreseeable future. These sectors are significant and growing emitters of CO2. Steel represents 6-8% and cement 6% of global energy system combustion and industrial process CO2 emissions.

In India, fast growing demand for steel and cement coupled with second-largest industrial base in the world in these sectors creates enormous opportunity for implementing deep decarbonisation initiative, which can lead to significant GHG emission reductions in India, and could also be one of key initiatives under India’s Nationally Determined Contributions (NDCs). A wide-range of technologies for GHG emission reduction for steel and cement industries have been proven in operational environment (Technology readiness level 9) or at least validated in relevant environment (Technology readiness level 5). India creates a perfect condition for deployment and scaling up of these technologies. For example, just retrofitting all cement plants to best available technology could result in up to 7% emission reduction.

While India is on track to meet its NDC commitments for 2030, its current ambitions combined with those of the major emitters, are far from aligning with the long-term goal of the Paris Agreement. With the available technology options, and best in class energy efficiency levels, emissions from the manufacturing sector would need to peak well before 2050 if India were to align with the 2 Degrees Celsius temperature increase limit scenario by 2100.

The emissions peak will come at a cost of decreased industrial output compared to business-as-usual growth, resulting in a loss of economic value addition of USD 230 billion and about 19 million jobs in 2050, roughly equivalent to present gross value added (GVA) and jobs contribution from the manufacturing sector. Hence, there is a significant need of finance for transforming the steel and cement sector.

Against this background, the first workshop meeting titled ‘Green Public Procurement (GPP) for Decarbonisation of Industry’ was held on 22 October 2021 to introduce IDDI and COP26 GPP campaign, present the status quo for GPP implementation in India and discuss opportunities and challenges for green public procurement for construction materials in India, with a particular sectoral focus on steel and cement. The discussion focused on regulatory framework and market readiness that would allow the country to meet its green public procurement targets. Options to stimulate decarbonisation of cement and steel industries – main contributors to construction’s carbon footprint – were also deliberated. The workshop also featured presentations by steel and cement industry associations outlining their efforts, challenges and opportunities in decarbonisation, particularly addressing the main technology gaps.

The second workshop titled ‘Technology transfer for decarbonisation of industry’ was held on 9 December to zoom into specific technology transfer options for decarbonisation of the steel and cement sectors in India. The workshop facilitated discussions on the state-of-the-art technologies and know-how, as well as opportunities for deployment within India. During the workshop, specific technology transfer options for decarbonisation of the steel and cement sectors in India were presented and discussed. Best practices from developed countries were also showcased. Following introductory presentations, the participants discussed opportunities and challenges in facilitating technology transfer within India.

The third workshop titled ‘Technical and financial assistance for decarbonisation of industry’ was held on 12 January to focus on presenting the outline of a technical assistance programme addressing the policy, capacity and technology transfer needs to bring India closer to its decarbonisation goals.

For more information on Industrial Deep Decarbonisation Initiative (IDDI), please visit: https://www.unido.org/IDDI