Electrification is one of the major strategies for decarbonization of economic sectors. India has major untapped potential for electrification, especially in the industrial sector to leverage its climate goals and ambitions. Yet the sector remains under-electrified at approximately 19% of the total final energy consumption, against the global average of 30%, presenting a significant opportunity for decarbonization.

As part of the joint study conducted by the Global Green Growth Institute (GGGI) and Confederation of Indian Industries (CII) in Phase 1, i.e. “Electrification Roadmap for Key Economic Sectors in India”, for the Bureau of Energy Efficiency (BEE), Government of India, key technologies were identified having potential to support accelerating electrification in the industrial sector to 25% of final energy consumption by 2030. However, this requires investment, policy frameworks, and industry leadership for the transformation. Potential to support accelerating electrification in the industrial sector to 25% in the near future.

Based on the consultation with BEE and building on the findings in the Phase 1 study, the next phase of the project will focus on a detailed process-level assessment across priority industrial sectors and MSMEs with commercially viable electrification technologies. In addition to this, the project will analyse technology adoption pathways, develop Marginal Abatement Cost (MAC) curves, assess alignment with the Carbon Credit Trading Scheme (CCTS) and Renewable Consumption Obligations (RCO), map state-level renewable energy policies with the national RCO framework in up to three states, and strengthen stakeholder capacity through knowledge products, training, and digital tools.

GGGI, in collaboration with CII, will conduct the comprehensive study in Phase 2 and support India’s goals for a decarbonized economy.

The project aims to accelerate industrial decarbonization in India by identifying, analyzing, and enabling the adoption of viable electrification pathways across selected industrial sectors and MSMEs. It will generate process-level techno-economic evidence on key electrification technologies, strengthen alignment with CCTS and RCO, and build stakeholder capacity through knowledge products, training, and decision-support tools.

India has committed to reducing the emissions intensity of its GDP by 45% and achieving 500 GW of non-fossil fuel-based power capacity by 2030. Electrification of industrial processes is widely recognized as one of the most effective pathways for achieving these climate and energy goals. Despite progress in renewable energy deployment, industrial electrification in India remains relatively low at approximately 19%, compared to the global benchmark of 30%.

As one of the largest consumers of energy and contributors to greenhouse gas emissions, the industrial sector presents a significant opportunity for decarbonization through the adoption of electricity-based technologies powered by cleaner energy sources.

In Phase I of the project a joint study was conducted by GGGI and CII for BEE, and contributed in identifying key technologies such as high-temperature heat pumps, mechanical vapor recompression (MVR) systems, electric furnaces, and transitioning from captive fossil-fuel-based power generation to grid and renewable energy sources to increase industrial electrification to around 25% in the near term.

However, large-scale adoption continues to face several barriers, including high upfront investment costs, limited process-level evidence, technology integration challenges, financing constraints, policy and regulatory gaps, and inadequate awareness and market linkages, particularly among MSMEs.

This project addresses these barriers through detailed technical assessments, policy analysis, capacity building, stakeholder engagement, and the development of enabling tools and platforms to accelerate industrial electrification across India.

The project will establish the technical, policy, and market foundations required to accelerate industrial electrification in India, enabling industries to adopt commercially viable low-carbon technologies while supporting national decarbonization, CCTS, and RCO objectives.

By the end of the project, the following objectives will be met;

– Technical electrification pathways established for 5 priority electrification technologies across selected industrial sectors and up to 3 MSME sectors, supported by process-level assessments, technology mapping, and sectoral potential analysis.

– Sector-specific Marginal Abatement Cost (MAC) curves and an Excel-based decision-support tool were developed to inform investment and policy decisions on industrial electrification.

– Stronger policy support for industrial electrification through 3 policy recommendations, including linkages with CCTS, RCO, and a dedicated policy note on heat pump deployment.

– Enhanced stakeholder capacity for 150 individuals with at least 20 % female beneficiaries through 9 knowledge products, including 1 e-learning module, 6 virtual knowledge-sharing sessions, and 2 physical workshops, supporting informed decision-making among industries, MSMEs, and government stakeholders.

– Improved market readiness and technology adoption through an IT platform, a database of 15 national and international technology providers, documented case studies, financing information, and strengthened industry linkages.

– Enhanced alignment between national and sub-national renewable energy frameworks through mapping of state renewable energy policies with the national RCO framework, supporting more effective implementation of industrial decarbonization pathways.

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