As India advances towards energy security and its Net Zero vision, integrating efficiency, green hydrogen, carbon utilisation and digital innovation across industry will be central to sustaining high growth while strengthening climate leadership
India today sits at the crossroads of rapid economic growth, rising energy demand, and ambitious climate commitments. Achieving energy sovereignty while progressing towards Net Zero requires systemic transformation driven by efficiency, integration, and innovation. As one of the fastest-growing major economies, India’s demand for electricity, fuels, chemicals, and materials continues to rise sharply, driven by urbanisation, infrastructure development, and manufacturing expansion.
At the same time, the country has articulated ambitious long-term commitments, including Net Zero by 2070, a National Green Hydrogen Mission, biofuel and Sustainable Aviation Fuel (SAF) blending mandates, and ambitious Carbon Capture, Utilisation and Storage (CCUS) targets. The central challenge is to move beyond incremental efficiency gains within the legacy systems and define a pragmatic roadmap for growth anchored in efficiency, integration, and innovation.
India’s industrial ecosystem remains deeply intertwined with energy consumption: coal continues to dominate electricity generation; crude oil imports exceed 230 MMTPA for transportation fuels and petrochemicals; natural gas underpins fertilisers and city gas distribution; and LPG remains central to domestic cooking.
The chemical industry forms the backbone of food security, mobility, housing, and advanced manufacturing through fertilisers, polymers, fuels, solvents, and specialty materials. Globally, demand for primary chemicals such as methanol, ammonia, and plastics is rising sharply.
Plastics production alone has increased from 2 million tonnes in 1950 to over 420 million tonnes in 2020 and is projected to exceed 1,100 million tonnes per year by 2050. If produced through conventional fossil-based pathways, this growth could drive emissions close to 3.5 Gt CO2 annually, far exceeding the emissions footprint of many high-value specialty chemicals. This imbalance underscores the urgency, scale and opportunity for structural change through feedstock diversification, process integration, and realignment of product portfolios.
A central pillar of the low-carbon transition is reframing carbon as a critical resource to be recycled. Large, concentrated CO2 streams from power plants, refineries, cement kilns, steel plants, and biomass-based industries offer significant opportunities for conversion into fuels and chemicals. Multiple routes are technically viable. Thermochemical pathways such as the reverse water gas shift reaction enable conversion of CO2 to CO using hydrogen, while catalytic hydrogenation can convert CO2 into methanol, a versatile molecule that serves as a fuel, hydrogen carrier, and chemical feedstock. Emerging electrochemical routes offer longer-term potential by directly coupling renewable electricity with carbon conversion, enabling deeper electrification of chemical manufacturing. Among these options, methanol stands out as a strategic anchor molecule. Integrating CO2 hydrogenation units with existing coal or biomass- based methanol plants can deliver near-term emissions reductions while improving overall energy and carbon efficiency.
Lifecycle assessments indicate that the chemical industry emits approximately 3 tonnes CO2 per tonne of chemical produced under business-as-usual conditions. Merely adding end-of- pipe carbon capture risks increasing total emissions if electricity inputs remain carbon- intensive. A credible Net Zero pathway therefore requires electrification of processes using renewable electricity, large-scale substitution of fossil-derived hydrogen with green hydrogen, system-level integration of CCUS, and deployment of direct air capture to address residual emissions. Critically, CCUS must be coupled with low-carbon power. Otherwise, indirect emissions from electricity generation may exceed the avoided CO2, negating benefits.
The realities point to a fundamental transformation of the refinery of the future. Refineries can no longer remain fuel centric assets; they must evolve into integrated carbon management and molecule manufacturing hubs. Feedstock flexibility becomes essential, with increasing reliance on biomass, biogenic CO2 , captured industrial carbon, and recycled plastics, alongside a gradual decline in fossil inputs. Compared to conventional coal combustion with CCUS, which suffers from low overall efficiency (typically 8–12 percent), gasification-based polygeneration pathways can achieve efficiencies approaching 45–50 percent while simultaneously producing hydrogen, chemicals, and fuels. Green hydrogen emerges as a cornerstone of this transition, not only for desulphurisation and upgrading but also as a universal reducing agent and energy carrier across refining and chemical operations.
Meeting refinery-scale hydrogen demand will require large-scale electrolyser deployment supported by renewable power and energy storage, with individual refineries potentially requiring 6–7 GW of clean electricity. Process electrification and intensification, through membrane separations, electrochemical reactors, and advanced catalytic systems, will be equally important in reducing energy demand and capital intensity.
The shift of product portfolio to high-value chemicals would also be a driving force for the refinery. Specialty chemicals, e-methanol, and advanced materials offer higher margins with lower carbon intensity. SAF represents a particularly strategic application.
Aviation currently accounts for approximately 2.5 percent of global energy-related CO2 emissions, and India has announced SAF blending targets of 1 percent by 2027 and 5 percent by 2030. Achieving these targets will require rapid development of multiple production routes, including Reserve Water-gas Shift (RWGS-FT) pathways, methanol-to-jet processes, and emerging electrochemical routes. All of these depend on access to affordable green hydrogen and reliable CO2 sources, with residual biomass and biogenic industrial emissions offering near-term advantages. Importantly, SAF also addresses Scope-3 emissions, an increasingly significant consideration for refiners, airlines, and global supply chains.
Enabling this transformation at scale will not be possible without digitalisation and artificial intelligence. AI-driven energy optimisation, predictive maintenance, catalyst discovery, hydrogen safety monitoring, and supply-chain forecasting are becoming core industrial capabilities.
Digital twin refineries that integrate real-time data with physics- based models allow continuous optimisation across energy efficiency, emissions, reliability, and cost, fundamentally reshaping how complex industrial systems are designed and operated. Ultimately, technology alone cannot deliver these goals. Coordinated policy frameworks, long-term carbon pricing signals, targeted incentives, and shared CO2 transport and storage infrastructure are essential to de-risk investments and mobilise private capital.
Sustained support for research and development in membranes, electrocatalysis, and advanced materials, along with workforce and skill development, is equally critical.
Incremental efficiency gains must be embedded within deeply integrated energy, carbon, and digital systems, with the convergence of technological, organisational, and policy innovations determining the pace and scale of transformation.
The author is Director, Indian Institute of Technology Roorkee. Views are his own.
