INTERVIEW: India’s Jindal Steel set to introduce renewable hydrogen in DRI unit in 3-4 months

India's Jindal Steel and Power Ltd is set to commission the first phase of its low-carbon steel facility at Angul, Odisha, within the next 3-4 months, Naveen Ahlawat, head of green hydrogen and green steel at JSPL, said July 16.

The project, developed in collaboration with subsidiary Jindal Renewable Power, will generate 4,500 mt/year of renewable hydrogen, which will be integrated into the direct-reduced iron process to reduce scope 1 and 2 CO2 emissions, according to Ahlawat.

"The project is being implemented in various phases, with the first phase being commissioned in the next three to four months," Ahlawat told Platts in an interview. "Subsequent phases will be planned based on the fully complied proof of concept from the first phase."

The initiative positions JSPL as a leading player in India's industrial decarbonization, aligning with the strategy to serve markets demanding sustainable steel, particularly in Europe, where the Carbon Border Adjustment Mechanism will impose tariffs on high-emission imports starting in 2026, according to Ahlawat.

In September 2024, JSPL announced plans to incorporate renewable hydrogen into its 1.8 million mt/year direct-reduced iron Angul plant, which will reduce its reliance on coal-fired energy by 50% in the next 2-3 years.

JSPL, which has a 9.6 million mt/year steelmaking capacity in India across multiple plants, will see low-emissions steel form a small part of its portfolio in the initial stages, according to Ahlawat.

Green steel premium

JSPL is considering long-term offtake agreements for its low-carbon steel, targeting high-end sectors including automobile manufacturing, renewable energy infrastructure, and export markets, said Ahlawat, who is also in charge of decarbonization and CCUS.

"Currently, the cost of green hydrogen in India is estimated at $4-$6/kg, but this is expected to decline with economies of scale and technological advancements," Ahlawat said. "Globally, low-carbon steel commands a 10%-25% premium, particularly in regions with regulatory incentives such as Europe."

The company has indicated that by utilizing its renewable energy generation capacity and adopting cutting-edge electrolysis technologies, it aims to bring down costs significantly over time, Ahlawat said.

JSPL's integrated production model and early mover advantage may allow it to offer cost-competitive low-carbon steel, especially as policy support and carbon pricing mechanisms evolve, he added.

Platts, part of S&P Global Energy, assessed Queensland hydrogen produced via alkaline electrolysis (including capital expenditures) at $5.49/kg July 15, down 3.68% from a month ago.

Platts assessed Japan hydrogen produced via alkaline electrolysis (including capex) at $5.20/kg July 16, down 3.17% from a month ago.

Geopolitical impact

US steel tariffs and Middle East conflicts have historically disrupted global supply chains and energy markets, potentially affecting pricing and market dynamics for both low-carbon steel and green hydrogen, Ahlawat said.

"The premium market for sustainable materials could grow within regions that are otherwise restricted to standard imports," Ahlawat said. "While geopolitical challenges may temporarily affect trade, they also reinforce the strategic relevance of investing in low-carbon, self-reliant industrial ecosystems, which is precisely what Jindal Steel is advancing through its Angul initiative."

Specifically, protectionist measures by the US may restrict direct steel exports, but simultaneously create niche opportunities for certified low-emission steel from producers actively reducing carbon footprints, he said.

Meanwhile, regional instability often leads to energy supply volatility, especially for fossil fuels, which strengthens the case for domestic and decentralized renewable energy, he added.

CCUS

JSPL invited one of its kind expressions of interest for the sale of 3,600 mt/d of captured CO2 from two steel units in Angul, or bids to set up a downstream plant to use the gas, its EOI statement said June 30.

The company, with a net-zero target by 2047, plans to use the captured CO2 for a wide range of industrial applications, including fuels, chemicals and food processing.