The Green Steel Taxonomy introduced by India marks a transformative step in aligning the steel industry with sustainability goals. Steel production, a significant contributor to global greenhouse gas emissions, is under intense scrutiny as nations strive for net-zero targets. This taxonomy provides a structured framework for classifying steel production based on its carbon footprint. By offering a transparent, graded approach, India’s initiative not only encourages decarbonization but also aligns with global ESG standards. Companies like BreatheESG can play a vital role in helping steel producers navigate and implement these standards effectively.

Understanding India’s Green Steel Taxonomy

The Green Steel Taxonomy categorizes steel production into tiers based on their carbon intensity. This system helps stakeholders assess the sustainability of steel producers, fostering a competitive drive for greener practices.

Key Ratings in the Taxonomy

Based on the greenness percentage, the taxonomy categorizes steel into different star ratings:

1. Five-Star Green-Rated Steel: Emission intensity below 1.6 t-CO2e/tfs.
2. Four-Star Green-Rated Steel: Emission intensity between 1.6 and 2.0 t-CO2e/tfs.
3. Three-Star Green-Rated Steel: Emission intensity between 2.0 and 2.2 t-CO2e/tfs.

Steel with an emission intensity higher than 2.2 t-CO2e/tfs is not eligible for a green rating. This rating system provides transparency and incentivizes manufacturers to adopt cleaner technologies.

By creating these categories, the taxonomy incentivizes cleaner production technologies, such as hydrogen-based steelmaking and electric arc furnaces, while discouraging reliance on traditional, carbon-heavy methods.

Benefits of the Green Steel Taxonomy

1. Encourages Innovation and Investments

The taxonomy pushes steel manufacturers to adopt cleaner technologies, spurring innovation and attracting green investments. Companies adhering to these standards are more likely to receive funding from environmentally conscious investors.

2. Enhances Global Competitiveness

Steel producers that align with the taxonomy can position themselves as sustainability leaders in international markets, gaining an edge in meeting strict import standards from eco-conscious nations.

3. Supports ESG Goals

The framework aids companies in aligning with Environmental, Social, and Governance (ESG) criteria, essential for securing investor trust and meeting regulatory compliance.

How Breathe ESG Can Support Steel Companies

1. ESG Reporting and Compliance

Breathe ESG offers tailored services to help steel manufacturers align their operations with the taxonomy. From carbon accounting to ESG reporting, their tools ensure transparent and effective compliance.

2. Transition Planning

By analyzing current production methods, Breathe ESG provides actionable roadmaps for transitioning toward greener steel production.

3. Stakeholder Engagement

Breathe ESG facilitates communication between companies and stakeholders, highlighting achievements in sustainability and building trust.

In Conclusion

India’s Green Steel Taxonomy is a critical step toward decarbonizing the global steel industry, fostering innovation and sustainable practices. As companies adapt to these standards, BreatheESG can serve as a vital partner, providing guidance on ESG reporting and sustainable transitions. By aligning with this taxonomy, businesses not only meet regulatory standards but also gain a competitive edge in a rapidly greening global market.