Green steel is steel made with far lower greenhouse-gas emissions than the conventional coal-based blast furnace route – by using green hydrogen, scrap and electric furnaces, renewable power, biomass or carbon capture. In December 2024 India became one of the first countries to define it, through a Green Steel Taxonomy that rates steel with three, four or five stars by its carbon intensity.
Why Steel Needs to Go Green
- Steel-making is one of the largest industrial sources of CO2 because the blast furnace uses coal and coke to reduce iron ore.
- In India the steel sector accounts for about 12% of national greenhouse-gas emissions, with an emission intensity of about 2.55 tonnes of CO2 per tonne of crude steel against a global average near 1.9.
- India is the world’s second-largest steel producer (about 150 million tonnes a year) and plans 300 million tonnes of capacity by 2030-31, so its steel emissions matter for the net-zero 2070 goal.
India's Green Steel Taxonomy (December 2024)
- Released by the Ministry of Steel on 12 December 2024, it defines green steel by CO2 intensity per tonne of finished steel, counting direct, indirect and limited upstream emissions.
- Five-star green steel: below 1.6 tonnes of CO2 per tonne; four-star: 1.6 to 2.0; three-star: 2.0 to 2.2. Steel above 2.2 tonnes is not green.
- Ratings are certified by an authorised agency (the National Institute of Secondary Steel Technology) on the basis of measured plant data, and are meant to enable green public procurement and carbon markets.
A clean PDF of this page with the C4S header — it opens right away, and the link comes to your WhatsApp too.
How Green Steel Is Made
- Hydrogen-based Direct Reduced Iron (H2-DRI): green hydrogen replaces coal or natural gas to reduce iron ore; the Ministry has sanctioned about Rs 455 crore for pilot projects under the National Green Hydrogen Mission, and India is developing indigenous pure-hydrogen DRI technology.
- Scrap-based electric arc furnaces powered by renewable electricity.
- Carbon capture, utilisation and storage (CCUS) on existing furnaces, and higher use of biomass and biochar.
- Energy efficiency and waste-heat recovery in the short term.
Policy and Global Initiatives
Free live session
NABARD Sprint 60: the 2025 cut-offs and your 60-day Phase I plan
In 5 days · Sun, 18 Oct at 7:30 PM IST
- The Ministry of Steel set up 13 task forces on green steel, covering hydrogen, renewables, scrap, CCUS, finance and standards, leading to the taxonomy and a proposed Green Steel Mission with an outlay of about Rs 15,000 crore.
- Global efforts: the First Movers Coalition (COP26), the Industrial Deep Decarbonisation Initiative (IDDI) under the Clean Energy Ministerial, SteelZero and ConcreteZero (Climate Group), ResponsibleSteel, and Sweden’s HYBRIT project, which produced the world’s first fossil-free steel in 2021.
- The EU Carbon Border Adjustment Mechanism (CBAM) taxes the embedded carbon of imported steel from 2026, giving Indian exporters a direct reason to certify green steel.
Important Facts for Examsmost asked
- Green Steel Taxonomy released by the Ministry of Steel on 12 December 2024; five-star below 1.6 tCO2/t, four-star 1.6-2.0, three-star 2.0-2.2.
- India’s steel emission intensity: about 2.55 tCO2 per tonne of crude steel; sector share about 12% of national emissions.
- Rs 455 crore sanctioned for hydrogen-based steel pilots; 13 task forces on green steel.
- HYBRIT (Sweden) made the first fossil-free steel in 2021; CBAM applies to steel imports into the EU from 2026.
- India: second-largest steel producer; National Steel Policy 2017 targets 300 million tonnes by 2030-31.
FAQs
Is green steel the same as recycled steel?
Not exactly. Scrap-based steel is one route to low emissions, but the taxonomy rates any steel by its measured carbon intensity, whatever the route.
Why does the taxonomy matter for exporters?
The EU’s CBAM and buyers’ net-zero pledges reward certified low-carbon steel; a five-star rating gives a verifiable claim.
Why is green steel asked in RBI and NABARD exams?
It combines climate policy, industry and trade; the taxonomy date, the star thresholds and India’s emission figures are typical questions.
