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The iron and steel industry
in India is struggling to meet environmental norms. While some plants
and companies are making efforts to clean up their acts, the sector’s
overall environmental performance is poor. It is using up enormous
quantities of resources (land, water, energy, raw materials), polluting
and not complying with even the weak environmental norms that exist
today, and getting away doing all this because of our lax regulatory and
monitoring capabilities.
This assessment of the iron
and steel sector in India has emerged from a unique rating of the
industry done by the New Delhi-based research and advocacy body, Centre
for Science and Environment’s Green Rating Project (GRP). The ratings
were released here today by Montek Singh Ahluwalia, deputy chairperson,
Planning Commission and Jayanthi Natarajan, Union minister of state for
environment and forests (independent charge).
The GRP has analysed all the
top steelmaking plants in the country to find out how ‘green and clean’
the sector is – how much resources it uses, how much it emits, how it
disposes its wastes, and how it deals with issues of local communities.
CSE’s Green Rating Project is
a 15-year old programme – the only public disclosure programme of its
kind in India -- which was envisaged as a tool to push for improvement
in policy and practices in industrial sectors. It does this by
assessing, rating and publishing the environmental and social
performance of the companies.
The Project has already rated
the automobile, paper, chlor-alkali and cement sectors; iron and steel
is the fifth key industrial sector rated by it. In all the sectors,
GRP’s efforts have led to significant improvements in environmental
performance of companies and better environment policy formulation by
the government.
What the rating found
The GRP rating process is extremely
rigorous, independent, participatory and transparent. The GRP rates companies
that agree to participate voluntarily as well as those who do not. Data is
collected from many sources, including industry, and verified by plant and site
visits.
On the basis of its findings, the
Project also confers the Five Leaves Awards on the plants which are rated the
most environment-friendly.
In the case of the iron and
steel sector, 21 companies, with over 0.5 million tonnes of annual
capacity, were rated on over 150 parameters – from technology to process
efficiency and from pollution to occupational health and safety and
compliance. The rating of steel sector took two years to complete.
As a whole, the sector
received a mere 19 per cent marks and the One Leaf Award. This has to be
compared to rating of the an equally polluting sector, cement sector,
which in 2005 got 36 per cent and Three Leaves Award. It shows that this
core sector, which includes the biggest and most powerful names in
Indian industry, has a long way to go.
Of the 21, three companies
scored over 35 per cent marks – and got the Three Leaves: they are Ispat
Industries, in Raigad district of Maharashtra, Essar Steel in Hazira
(Gujarat) and Rashtriya Ispat Nigam Limited (RINL or Vizag Steel), based
in Visakhapatnam, Andhra Pradesh. The Three Leaves Award represents
‘average’ performance under GRP.
Some of the other key findings of the
GRP rating exercise are:
1. The Indian iron and steel sector’s
energy consumption of 6.6 GCal/tonne is about 50 per cent higher than
the global best practice.
2. Process water consumption, excluding
power generation, townships and other downstream operations, is a high
3.5 m3/tonne – over three times the global best practice.
3.
The large-scale plants
have been found to be highly wasteful on land. They have close to 1,200
hectares (ha) of land per million tonne of installed capacity; a
well-designed plant does not need more than 200 ha. If all the residual
land with steel plants were to be properly utilised, the industry can
produce more than 300 million tonnes steel, not the 75 million tonnes it
is producing today. In fact, the steel industry will not need extra land
till 2025.
4. Most steel plants have been found to be
non-compliant with pollution norms.
Neelachal Ispat does well,
Bhushan Steel Dhenkanal comes last
Of the five companies rated
from Odisha, Neelachal Ispat Nigam Limited of Kalinganagar has emerged
at the top with its fourth ranking and a Two Leaves Award. The state is
fortunate to have plenty of cheaply available raw materials – iron and
coal. A number of plants have been found to be following the coal-based
sponge iron route of steelmaking.
As a result, pollution from
fugitive dust emissions and solid wastes from these plants is acquiring
epidemic proportions in Odisha. Though the state’s pollution control
board has been trying to monitor pollution and enforce norms, the
industry here has been beset by a number of concerns: high air and water
pollution, poor waste disposal practices, non-compliance with
environmental norms and poor health and safety record.
Neelachal Ispat’s high
ranking has been owing to its use of advanced coke oven technology, and
its practice of recycling waste energy for power generation. However,
the plant has earned censure for its wastewater discharge not complying
with norms and its inefficient utilisation of land.
SAIL Rourkela, at the 11th
spot with a One Leaf Award, was the only SAIL plant which participated
voluntarily in the rating exercise; the rest – Bhilai, Durgapur, Bokaro
and Burnpur – did not and hence, were rated on the basis of available
information. SAIL plants in general were found to be “non-transparent
and non-compliant with environmental norms”.
Of the other three, Visa
Steel (Kalinganagar) emerged at the seventh position with a Two Leaves
Award, while Bhushan Power and Steel (Sambalpur) was at the 12th
spot with a One Leaf.
Bhushan Steel of Dhenkanal
has been adjudged “the worst performing plant under GRP in all aspects”
– it is non-transparent, with poor disclosure systems, and did not
participate in the rating exercise. It pollutes, has a very poor safety
record and bad solid waste disposal practices, and has earned the ire of
the local communities for its abysmal environmental performance.
Downslide: Indian industry
gives the shove to environment
Says Sunita Narain, director
general, CSE: “The poor environmental performance of this sector is a
measure of the failure of the regulatory institutions in the country.
Nobody is asking this sector to improve its green bottom-line. Nobody is
measuring and monitoring its actual performance. We should not be
surprised. The country has worked to decimate its pollution regulatory
paraphernalia – the steel sector is a hard reminder of this.”
Chandra Bhushan, CSE’s deputy
director general and head of the Green Rating Programme, points out,
“The iron and steel sector’s score is the lowest compared with the other
sectors that GRP has rated previously. In fact, the steel sector not
only has the worst pollution compliance record, it was also found to be
highly non-transparent and poor on information disclosure.
The question now is, what do
CSE’s green rating exercises point to in terms of the overall
performance of industry in India?
Says Sunita Narain: “When we
had begun our rating way back in the mid-1990s, Indian industry was
starting to learn environmental management. By the time we rated the
cement sector in 2005, we noted that Indian industry had mainstreamed
environment management into its policy and practices. But in 2012, we
are revising this assessment. The environmental non-performance of the
iron and steel industry, a core sector of the economy -- involving
biggest industry names and having a separate Union ministry – has left
us worried.”
Even the companies which have
performed relatively better in the rating programme seem to have done so
incidentally. The top three companies have invested in efficient
technologies to cut their energy and material costs – this,
incidentally, has also improved their environmental performance.
According to Chandra Bhushan,
what the GRP exercise has found about the iron and steel sector points
to a worrying future, which calls for immediate corrective action. The
sector is rapidly expanding: within a decade, it has moved from being a
24-million tonne industry to a 70-million tonne behemoth, and is
aspiring to the 300-million tonne target in the next two decades. If the
business-as-usual continues, the steel sector will create insurmountable
environmental and social problems.
What can be done to stem the
rot?
There is hope, of course.
Says Chandra Bhushan: “The
future road map for the sector is clear. It will have to reduce its
ecological footprints drastically, invest in health and safety of its
workers and treat local communities as stakeholders and beneficiaries.”
Plants will have to halve
their energy use, use only that much water which is needed for
evaporative losses and thus stop discharging wastewater, and recycle and
reuse their solid wastes. And they will have to take measures to reduce
air emissions significantly.
In fact, the more the
companies invest in environmental performance the better will be their
cost-efficiencies. The investment in energy efficiency pays back as does
the reuse and recycling of waste. The less the use of material and
energy, the lower the costs and lower the burden of disposal into the
environment.
“Therefore, good resource
management not only makes the steel sector more efficient, but also
protects the environment. This is a win-win that we must strive
towards,” says Narain.
“On this eve of World
Environment Day, the steel sector rating is a reminder of the
challenges, but also the enormous potential of bringing about change,”
she adds.
[Centre for Science
and Environment is a Delhi based non-governmental Organisation
known for its policy research and advocacy on environmental issues] |
