Innovations of Steel

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A joint partnership between UNDP and the Ministry of Steel, Government of India and Global Environment Facility is helping energy-intensive steel sector save up to 40 percent on energy consumption enabling entrepreneurs to reap greater profits.

Highlights

  • UNDP’s intervention in the energy-intensive steel sector has helped the sector save up to 40 percent on energy consumption and entrepreneurs reap greater profits
  • Environmentally viable energy-efficient technologies have reduced furnace oil consumption by 30 percent and coal consumption by 50 percent
  • Burning loss has been reduced by 50 percent and mill utilization has improved by 15 percent in 25 units
  • Several model units have been recognized by national and state governments for their efforts in reducing energy consumption
  • Steel production in India generates roughly 1.2 tons of solid waste and 2.5 tons of carbon dioxide and other pollutants annually, and relies heavily on outdated, high cost technologies

Results from a UNDP pilot project demonstrate that small and medium steel re-rolling mills can now save up to 40 percent on energy consumption, enabling entrepreneurs to reap greater profits. Steel production is an energy intensive process that generates roughly 1.2 tons of solid waste and 2.5 tons of carbon dioxide and other pollutants annually. India’s 1,200 odd steel re-rolling mills, many of them small-scale are a critical link in the supply of steel, and contribute more than 57 percent of steel produced countrywide. Yet many of these mills operate with outdated, high cost technologies that are largely self-financed.

In 2004, UNDP in partnership with the Ministry of Steel, Government of India and Global Environment Facility (GEF) launched a project aimed at increasing end use energy efficiency in the steel re-rolling sector, thereby, reducing greenhouse gas emissions. Environmentally viable energy-efficient technologies have reduced furnace oil consumption by 30 percent and coal consumption by 50 percent. Burning loss has been reduced by 50 percent and mill utilization has improved by 15 percent in 25 units. Overall, the pilot has demonstrated that small and medium enterprises (SMEs) can save up to 40 percent on their energy consumption.

According to Caitlin Wiesen, Country Director, UNDP in India, “As India's economy continues to grow, small and medium sized enterprises need to become more efficient to remain commercially viable. Working with small-scale steel re-rolling mills, UNDP is demonstrating the possibilities of win-win solutions wherein increasing energy efficiency and reducing costs of SMEs can enable entrepreneurs to earn greater profits from cleaner technology.

The steel re-rolling sector in India has over the past seven years, managed to turn the tables on historically high energy consumption. The success of many of the model units has been acknowledged by state and national governments. M/s MPK Steel Pvt Ltd, a model unit in the north-western Indian state of Rajasthan, received the Rajasthan Energy Conservation Award for 2009-10; Renewable Energy Agency of Puducherry government presented an award to M/s Pulkit Steel Rolling Mills for adopting energy-efficient technologies; and Shree Prithvi Steel Rolling Mills received the Rajasthan Energy Conservation Award for 2008-09 in addition to the National Energy Conservation Award for 2009-10.