₹207-Crore Project to Build India’s First 100% Hydrogen Steel Plant

The CSIR-Institute of Minerals and Materials Technology (CSIR-IMMT) will lead a Rs 207-crore pilot project to develop India’s first direct reduced iron (DRI) plant operating entirely on hydrogen, an official said.

The 20-tonne-per-day project has received in-principle approval from the Ministry of Steel and the Ministry of New and Renewable Energy. It will receive Rs 113 crore in government support under the National Green Hydrogen Mission, with the remaining funding from consortium partners.

CSIR-IMMT Director Ramanuj Narayan said the facility is expected to be completed by August 2029. It will focus on developing hydrogen-based DRI technology suited to Indian conditions, particularly the use of domestic iron ore.

The consortium led by CSIR-IMMT includes Godavari Power and Ispat Ltd, Lloyd Steel, Jindal Stainless and Thyssenkrupp Industries India. Tata Steel has agreed to join the consortium, while efforts are being made to bring other major steel producers, including Steel Authority of India Ltd (SAIL), into the project.

The facility will use a vertical shaft furnace designed to operate entirely on hydrogen. A key challenge would be processing India’s relatively low-grade hematite ores. Several international hydrogen-DRI projects use higher-grade magnetite.

CSIR-IMMT is working on ore processing and reduction technologies to ensure the proposed plant can handle Indian iron ore. Officials said the technology is still at the pilot stage globally.

The institute is setting up a 3-tonne-per-day DRI plant using its resources to bridge the gap between laboratory-scale experiments and the proposed pilot. Officials said intermediate-scale testing is important as material behaviour can change during scale-up.

The project faces economic challenges. Green hydrogen currently costs around USD 5 per kg and would need to fall to about USD 1 per kg for hydrogen-based steelmaking to become commercially competitive. Green steel production currently costs USD 200 more per tonne than conventional steel produced using fossil fuels.

CSIR-IMMT has separately received in-principle approval for a Rs 20-crore rotary kiln pilot project to test up to 30 per cent hydrogen with biochar in existing DRI processes.