1
PROPOSAL FOR PDF BLOCK B GRANT
1.
COUNTRY:
INDIA
2.
FOCAL AREA :
Climate Change
3.
OPERATIONAL PROGRAMME:
OP- 5; Removal of Barriers to Energy
Efficiency and Energy Conservation
4.
PROJECT TITLE:
Energy efficiency improvement in Steel rerolling
Sector in India
5.
TOTAL COST:
US $ 340,000
6.
PDF REQUEST:
US $ 280,000
7.
IN-KIND CONTRIBUTION:
US$ 60,000 (Government of India)
8.
REQUESTING AGENCY:
UNDP, India
9.
EXECUTING AGENCY:
Ministry of Steel, Government of India
10.
DURATION:
Twelve months
11.
PROJECT OBJECTIVE:
The primary objective of this project is to introduce energy efficient technology packages for
the steel rerolling Sector of India, and thereby facilitate removal of barriers to energy efficiency and
energy conservation in this sector. The PDF – B project aims at evolving suitable energy efficient
technical packages through 1) designing energy efficient packages for clusters of different categories
of steel rerolling mills (based upon the existing gaps between the current and expected energy
efficient practices), 2) removal of key barriers, including technical and financial barriers to the
adoption of the energy efficient packages, 3) identifying capacity building issues and training needs
and 4) putting in place institutional mechanisms, which would facilitate in replicating the proposed
packages.
12.
GLOBAL SIGNIFICANCE:
Steel, with a global production of over 784 million tonnes per annum, is second only to
cement in the world of materials. Steel in India is considered a prime mover of the modern Indian
economy. Since the policy reforms in 1991, the steel industry in India has been placed in a new
environment. Steel production has increased from 14.2 million tonnes of finished steel in 1991-92 to
23.5 million tonnes in 1996-97. The Ninth Five Year Plan (1997-2002) has envisaged an estimated
demand of 38 million tonnes in the year 2001-02.
The production of steel in India is an energy and waste intensive process and requires a large
consumption of raw materials These include coal, iron ore, limestone, scrap, wide range of other
materials such as thermal coals, gas, furnace oil, refractories, chemicals, alloys, power, refining
materials, and water. The production of 1 tonne of crude steel from iron ore generates about 1.2
2
tonnes of solid waste, 2.5 tonnes of CO2 and other polluting gases to the atmosphere. Therefore, the
industry has an appreciable influence on society and the environment. The global environmental
concerns include air emissions and related impacts of climate change.
In the case of steel re-rolling industry in the country, a comprehensive survey was conducted
in 1996. The survey provided insight into various crucial parameters. It was found that the usage of
energy (in terms of consumption of power/electricity, coal and furnace oil), the product yield, and
labour productivity varied considerably from one category of steel rerolling mills to another
depending upon the technology employed and level of investment.
The proposed project is expected to lead to both direct reduction in the energy inputs such as
electricity, coal, and furnace oil and indirect energy savings through improved processes for better
yields (output). The estimated energy saving is approx. 30.8 PJ for a production of 10.62 million
tonnes of steel. Correspondingly, about 3.6 million tonnes of CO2 emissions would be avoided every
year (Please refer to Annex for details). The savings are approximately equivalent to 42% of total
energy bill valued at US $ 72.2 million and about US $ 21.6 per tonne of steel, which is nearly 46%
of the value addition by an average re-rolling mill unit (Annexure - 8). As further capacity addition
is envisaged in the steel sector, the impact on future GHG emission reduction and fuel savings is
likely to be greater.
13.
BACKGROUND:
Steel rerolling is one of the most important segments of the steel industry. It provides
employment to more than 68000 people. Due to sheltered market economy in the pre-economic
liberalisation phase, this industry grew up haphazardly adopting the old conventional technologies.
However, the industry has been successful in meeting low tonnage requirements in various steel
grades, sizes and shapes to a variety of customers. According to the “Comprehensive Survey on Steel
Rerolling Industry”, July 1996, carried out by the Organisation of Development Commissioner of
Iron and Steel, the steel rerolling sector comprises 1167 (working) re-rolling mills of various sizes.
Some mills are composite {with electric arc furnaces (EAFs) and Induction Furnaces (IFs)}. The
cumulative average annual growth rate from 1966 to 1996 was around 4.7%. Correspondingly, the
production grew from 4.7 million tonnes (431 mills) up to 19.4 million tonnes (1167 units).
The re-rolling mills with the overall average size of 16625 tonnes per annum are scattered all
over the country. The maximum concentration is in the northern and the western parts of the country.
The small-scale units with an average capacity of 11,550 tonnes per annum account for 52.8% share
of the total capacity. The small units of size up to 5000 TPA are most labour-intensive. Medium and
large-scale mills with an average capacity of 32,050 tonnes per annum constitute the balance. The
large and medium scale market segments are likely to continue with an increasing market share in the
future. This is mainly as a result of the liberalisation of the economy and dismantling of the
administered prices, leading to competition.
The main equipment generally used in the rolling units comprise 2-Hi / 3-Hi conventional
rolling mill stands working in tandem; roughing, intermediate and finishing mills with common and
multiple drives; associated auxiliary facilities such as guides, manipulators, pinch rolls, etc; cooling
beds, coiling facilities, and reheating furnaces; both batch and continuous pusher type with
combustion equipment like burners; and heat recovery units like recuperators. Some of the units are
using heat recovery devices like recuperators, which are of metallic shell and tube type. The
combustion system is mainly of two types. For coal-firing, both horizontal and step grate systems are
used. Coal is fired either manually or mechanically via screw feeder systems, the latter giving higher
3
combustion efficiency. A stationary grate coal firing system, with a forced draft is commonly used in
rerolling mill furnaces in India. In oil fired reheating furnaces (RHFs), the burners used are mainly of
low-air pressure type. The industry has employed different types of burners in RHFs, both locally
made and those of imported makes. Most of the rolling mills are of open train 2-Hi/3-Hi type having
roll diameters ranging between 180 mm to 450 mm in the roughing stage. The mill speed is in the
range of 90 to 275 rpm having 2 to 6 stands. The mechanical coupling between the mill motor and
stands is either of V belt and pulley type or of speed reduction gear type. Both the systems, however,
have flywheel arrangements to take care of the load fluctuations.
The primary energy sources used in the re-rolling mills are electricity, coal or fuel oil (in the
form of furnace oil, R.F.O., LSHS, and LDO). Out of the total units surveyed, about 60% of the units
are using oil and 40% of the units are using coal as the main thermal energy input. Electrical energy
is used by all the units to run their motive loads. The specific thermal energy consumption in oil-fired
furnaces is in the range of 45 to 85 litres per tonne of finished product. In coal fired furnaces, it is in
the range of 125 to above 400 Kgs. The specific electrical energy consumption is in the range of 100
to above 300 kWh per tonne of finished product. The average energy consumption pattern reported in
the Indian rerolling mills are 180 kWh of electricity/tonne of steel (Japan: 60 to 85 kWh), 61 litres of
furnace oil /tonne (Japan: 13 - 14 litres of oil for 90% hot charging at 650 C and around 26 litres for
100% cold charging), and 253 kg of coal /tonne (not used in developed countries), which is very high.
The corresponding CO2 emission level in India is estimated to be 3 times higher than those of the
developed countries such as Japan. However, as the production is likely to grow, by the end of the
Ninth Five Year Plan (1997-2002), this sector is expected to contribute above 15 million tonnes per
annum at a capacity utilisation of 75% or more. According to several studies carried out in large
number of steel rerolling mills, there is a potential scope of energy reduction through introduction of
energy efficient technology packages.
Key Barriers and Project (PDF-B) Design
The steel re-rolling sector consists of small and medium units but has a large aggregate capacity.
The major problem of the industry is lack of knowledge / awareness of both 'Kaizen' and 'leap frog'
E3STs (energy efficient and environmentally sound technologies) as well as practices that have been
introduced successfully across the globe. The means of transforming this knowledge / awareness into
an operational framework is also lacking. The major barriers to the improvement of efficiency in this
sub-sector are identified as follows:
 Low and asymmetric information base which has limited the size of technology market.
 Low engineering, technology, innovation and R&D base.
 Low level of human resources development;
 Lack of access to technology & technology sharing; limited access to financial markets; weak
technology market infrastructure; and limited technology commercialisation through bulk
procurement, agreements, and other demand-pull mechanism;
 Dominance of technical and financial risks in the minds of decision makers;
These barriers have led to a stage of technological regression of the industry and have, therefore,
emerged as weak links between the overall national sustainable development programmes and efforts
to protect the global environment. So far, the early approaches were not only undertaken in a piecemeal manner but also sporadic in nature. These efforts were broadly confined to energy audit studies
of RHFs, which permitted only 10 to 15% of direct improvement. Indirect energy efficiency
improvement measures linked to improving yield and quality (to minimise scale loss, end croppings,
rejections, cobbles, etc) were largely ignored. In other countries, various technological measures
were taken that reduced specific energy levels of similar rolled products by a factor of 2 to 3 times
4
(for example, South Korea, Japan, Germany, U.K., etc.).
The preliminary assessment of some economically viable options as applicable to steel re-rolling
sector in India is given below. The project will evaluate which of these options can be used singly or
in combination as part of technology packages to be promoted through project efforts.
Area
Combustion
Fuel
Furnace Oil, 
Coal, Natural
gas


Motive loads
Yield



Power
Indirect
material
Energy
Saving



&
Eco-Tech Options
High efficiency recuperators, self regenerative burners, oxyfuel burners, pulverised coal injection / cyclone combustion
burners, etc.
50-90% hot charing - Intermediate door charge furnaces in
case of composite mills
QST (Quenching & Self Tempering) on-line process to
improve material & energy efficiency and product quality.
Energy efficient drives.
Improved mill design such as pre-stressed, 3-cone mill, etc.
Computer aided Roll Pass Design, Virtual Rolling Mill
Concept to reduce roll passes to minimum.
Application of high efficiency rolls.
Hot mill lubrication to reduce motive loads, etc.
Mainly through quality & process audits - reduction in mill
scale, end-cutting / cropping, rolling defects, metallurgical
defects, geometric defects, cobbles, etc.
The preliminary analysis of the investments (depending upon size, mill configuration and
product) shows that specific investment level is in the range of $ 20 to $ 60 per annual tonne of
capacity with an average of $ 40 per annual tonne. Cost of conserved energy (CCE in $/GJ) works
out to $ 12/GJ for a specific energy saving of 3GJ/Te with a pay back of approximately 1.8 years.
Although industry, by and large, is aware of the challenges and opportunities posed by free trade and
globalisation, it is not able to overcome the barriers as listed above at present.
Project Design
The project is designed to provide an effective technology interface with the steel re-rolling
sector. A multi-disciplinary team will be constituted to carry out a comprehensive energy assessment
study. This will address the totality of the issues and shall take into account both direct and indirect
measures, including shortening of the process cycle by eliminating superfluous steps which consume
energy (for example on-line treatment of steel by avoiding additional heat treatment step). In the
PDF-B, a three dimensional integration approach shall be adopted: 1) removal of barriers, 2)
providing effective technology interface and 3) sustainable growth & development parameters
including financing. This project approach shall help in developing 3-4 energy efficient packages
by "tailoring" the technologies to the needs by appropriate size and configuration of the steel
rerolling sector in a manner that will match and provide balance-of-system so as to develop low cost
integrated technology packages for the industry. These projects, including their financing through
available sources, will be demonstrated as part of GEF project. Depending upon the size and number
of demonstration (pilot) units selected across the country (80 to 100), the investment resources
required for this demonstration phase are estimated to be of the order of US$ 40 to 60 million.
Further replication across the sector will require that the barriers are removed, and the investments
are successfully financed and implemented.
5
Various capacity building measures are proposed to be undertaken as part of this project. The
Office of the DCI&S is the nodal agency for the steel rerolling sector in India. Therefore it will focus
its policy framework on investments aimed at enabling unsupported replication of win/win
technologies even after GEF support has ended. This will include the development of technology
market infrastructure and support to commercialization through bulk procurement, negotiated
agreements and so forth.
In addition to financial support from UNDP/GEF and the steel Development Fund (SDF)—a
major captive source of co-financing in the Office of DCI&S, the Ministry of Steel will secure access
to other funds. These will include seeking the involvement of finnacial institutions (IDBI, SIDBI,
ICICI, FCI and Banks), in providing assistance for the commercialisation of both indigenous and
imported technologies for wider domestic applications through venture capital funds. The
Department of Science and Industrial Research also provides funding (TDB, SEETOT, and PATSER)
for technology development and applications.
The Project is designed to complement the efforts for the proposed technology facilitation
centre, being financed through the Steel Development Fund (SDF). This centre is expected to
provide modern equipment and test facilities, and will also function as a technology park for the steel
rerolling sector. In addition to in-house testing and evaluation of various technological options for
wider dissemination in India, this centre will also provide for dissemination of technical information,
meeting the training needs of the industry and developing core competence of the industry to acquire:



A technology;
A methodology to make the technology work; and
An embedded knowledge and means of transforming this knowledge into operational
framework;
This centre will take steps to eliminate asymmetries of information that limit the size of the
technology market and also to gather information for all stakeholders which will help reduce
transaction costs for technology transfer and development.
The closing phase of the project design is to evolve a suitable financing package addressing
the industry’s incentive structure including strategic dimensions of the process with an objective to
achieve accelerated adoption of the low-cost technology package by industry (refer to 15(7))
14. PROJECT DESCRIPTION: INCLUDING IMPLEMENTATION ARRANGEMENTS
The PDF-B proposal aims to 1) design suitable energy efficient packages for the steel
rerolling sector in India; 2) suggest measures to overcome the barriers for adoption of the proposed
energy efficient packages; and 3) prepare a full project proposal for GEF for technological
upgradation of the steel rerolling sector through implementing the energy efficient packages.
The project will conduct a detailed assessment of available energy efficient technologies for
steel rerolling and design the package for Indian conditions. It will identify areas of energy leaks,
pollution levels, operational practices and maintenance, by conducting the detailed energy and
environmental assessment of the representative steel rerolling mills. A detailed study of each key
parameter for effecting energy conservation in the steel re-rolling industry would be thoroughly
understood. Subsequently, the areas of capacity building and institutional needs will be recognised.
6
The Ministry of Steel (MoS) will take overall responsibility for the execution of the project
as per the UNDP guidelines. The project will be implemented by the Office of the Development
Commissioner for Iron & Steel (DCI&S), MoS and its autonomous institutions and organisations
namely National Institute of Secondary Steel Technology (NISST), Economic Research Unit (ERU)
of Joint Plant Committee.
A Project Steering Committee will be constituted by the MoS to oversee the execution of the
project. The Steering Committee will be comprised of representatives from the MoS (Steering
Committee Chair), cross-sectoral ministries including the Department of Economic Affairs, Ministry
of Environment and Forestry, Ministry of Industry, Ministry of Coal, public/private sector
organizations, the National Institute of Secondary Steel Technology under MoS, NGOs, prominent
experts, and UNDP. The Steering Committee will act as the coordinator for the preparation and
finalization of the project brief and full document, and as such will provide the necessary guidance
and oversight to the project implementation. Individual experts will be invited to provide inputs as
appropriate to specific meetings. The Steering Committee will facilitate cross-sectoral involvement
from the ministerial to the private sector and community levels, review outputs, and ensure that the
project strategies meet national goals and objectives.
A National Project Director (NPD) will be appointed by the MoS with the consultation with
UNDP for the supervision of the project. The NPD will be responsible for the review, monitoring and
clearance of the work plan, which forms the basis for project execution. The Steering Committee will
establish a Selection Sub-Committee, which will finalise the selection of the project team as per the
TORs. Day-to-day co-ordination will be the responsibility of the Project Manager, contracted through
this project To this end, the NPD will facilitate close co-ordination among the various line ministries,
state governments, nodal departments, private sector and the participating institutions.
A Project Management Cell (PMC) will be set up in New Delhi to carry out day to day
working of the project. The PMC will be headed by a Project Manager for carrying out the PDF
phase. He will be assisted by the project staff comprising of two technical and support staff. The
Project Manager will maintain close interaction with the institutions associated with the line
ministries. He will also facilitate the work of the collaborating institutions and consultants in the
preparation of the project brief and full proposal. The Project Manager will report to the NPD and
the Steering Committee for policy directions, work plan and budget approvals.
15. DESCRIPTION OF PDF ACTIVITIES
The proposed PDF activities are the following:
1.
Constitute a Project Steering Committee and draw up appropriate linkages with national
Government, State Governments, Entrepreneurs and Financial Institutions based on
stakeholders analysis. This will also involve examining the policy, administrative, technical
and legal hurdles in the Steel Re-Rolling Sector of the country for commercialisation of low
cost GHG emitting technologies.
2.
Conduct a detailed energy - consumption assessment of representative steel rerolling mills
with the active involvement of entrepreneurs to identify various areas of energy wastages,
process deficiencies and technology gaps. The PDF will particularly assess the present
energy consumption pattern to identify the areas of energy wastages and 'tailor' the
technology to the needs by appropriate size & configuration of the steel rerolling sector, in a
7
manner that will match and provide balance-of-system with an objective to develop low cost
integrated technology packages for the sector. The PDF will also assess the ability and
willingness of entrepreneurs to adopt upgraded low-cost GHG emitting technologies. For this
purpose, a small sample of representative units (20/25) will be taken. The basic criteria of
selection shall be the product range of steel re-rolling sector. According to this, units will be
selected on the basis of weightage assigned to each category such as follows:
Rebars
Medium Structurals
Heavy Structurals
8-10 mm
12-22 mm
22-40 mm
10-15%
25-30%
15-20%
(50 – 65%)
15 - 20%
10 - 15%
With respect to size, only medium and higher capacity units will be selected for their
relatively high amenability and keenness to adoption of E3STs as also for their larger capacity
representation. As mentioned earlier, the small-scale segments might not survive for long due
to likely intense competition and environmental regulations. The four simplified regions will
be selected.
They are Delhi (Delhi/Jaipur/Ghaziabad/Faridabad), Gobindgarh
(Gobindgarh/Ludhiana), Nagpur (Nagpur/Raipur) and Chennai (Chennai / Bangalore /
Hyderabad). These regions will be serviced by the regional offices and technical institutions
of the DCI&S providing necessary infrastructural and logistic support.
3.
Identify proven low GHG emitting technologies, which can be employed in the Indian
context. At national and international level, the PDF will assess and review the proven,
commercially viable technologies in the steel re-rolling sector.
4.
Develop integrated low-cost technology packages for the re-rolling sector in India; the
capabilities of instrument, plant and machinery manufacturers in the country for providing
the identified components/technology packages will be assessed and reviewed so as to ensure
an easy availability of the same for sustainable adoption of identified low GHG emitting
technologies.
5.
Assess the financial needs of technology upgradation/integrated low-cost technology
packages required for the steel rerolling sector. Develop suitable linkages as well as financial
mechanism for early adoption of the technology package with non-GEF sources such as IFC,
ICICI, SIDBI, IFCI, and Banks; DSIR funds (TDB, PASTER, and SEETOT) and the Steel
Development Fund - a major captive source of financing steel-related developmental projects
in public and private sector. It is expected that the GEF support to these demonstration
activities will be structured as “contingent financing” given the “win-win” nature of the
technologies being targeted.
6.
To review the rules, regulations and norms including industrial policies of the State
Governments for facilitating and encouraging the entrepreneurs and the investment
institutions in adoption of low-cost GHG emitting technologies.
7.
Study the whole gamut of incentivisation of efforts at all stakeholders' levels, both in
monetary and non-monetary terms, for accelerated diffusion of the technology package in the
steel rerolling sector. The former includes rewards, trophies, prizes and other awards, which
will be appropriately sized to the effort and large enough to impact behaviour. The latter
category is supposed to include voluntary agreements (VAs) between government and
8
industry; appropriate fuel pricing, web-based and resident training modules; institutionalising
if necessary collaborations for win-win solutions; promoting technology acquisition reforms;
and evolving directives, instructions and guidelines.
The two dimensions of the
incentivisation process, that is, 'strategic dimension' and 'realisation dimension' will be
adequately addressed in the study with an objective to bring about structural change in
industrial culture and environment to achieve the desired programmatic gains in energy
efficiency on a sustainable basis.
8.
Analyse specific measures to eliminate these barriers (ref to Barriers and Project Design).
The assessment of how to best overcome some of these barriers will be developed into a
strategy to ensure financial sustainability of the investment project beyond its lifetime. The
analysis will include an assessment of consumer acceptance of the proposed project package.
9.
Estimate the scope for win/win technologies in India that are not being implemented due to
existence of barriers.
10.
Estimate the potential contribution of these measures of technology upgradation towards
abating the emissions of greenhouse gases.
11.
Formulate and develop a detailed project proposal, the implementation of which will remove
the identified barriers permanently, where the approach can sustain and replicate itself.
12.
Determine the incremental and base-line costs of the project as per the GEF guidelines;
Estimate the overall financial requirements, sources of finance and the time horizon;
13.
Assess the sustainability of win/win energy-efficient technologies after GEF support has
ended: the capabilities of instrument, plant and machinery manufacturers in the country for
providing the identified components/technology packages will be assessed and reviewed so
as to ensure an easy availability of the same for sustainable adoption of identified
technologies.
14.
Finalise project brief based on detailed stakeholder consultations.
The project preparation to date has been funded by the Organisation of DCI&S. The recently
completed UNDP/GEF ALGAS project identified steel rerolling sector as one of the thrust areas for
mitigation of GHG emissions. The project concept has been identified keeping in view the GEF
operational project guidelines and the thrust areas stipulated in Government of India policies.
14. PDF B BLOCK OUTPUTS
PDF outputs will be as follows:
a)
b)
c)
Report on assessment of the state of technologies for the steel rerolling sector;
Energy efficient packages; equipment / design packages for Indian steel rerolling mills; and
A Full proposal or a project brief for submission to GEF.
14. ELIGIBILITY:
This proposed project is responsive to the goals of GEF Operational Programme No.5
9
"Removal of Barriers to Energy Efficiency and Energy Conservation". The PDF phase will facilitate
successful implementation of energy efficient package in steel rerolling sector. India ratified the
UNFCCC in November, 1993.
15. NATIONAL LEVEL SUPPORT:
The necessary support will be available from the Ministry of Steel, SAILCON, DCI&S,
through budgetary allocations. Additional funding as appropriate will be identified as a part of the
PDF activity in conjunction with determination of incremental cost.
This proposal is fully consistent with the national priorities of the Government of India
towards the adoption of energy efficient technologies for reducing pollution. A major thrust of this
goal is promotion and dissemination of sustainable viable technologies throughout India. This
project is also consistent with the UNDP's concept of sustainable human development, which
supports the demonstration of sustainable technological interventions such as those proposed under
this project.
16. JUSTIFICATION
This PDF Grant is necessary to undertake activities to ensure that the fianl proposal is fully
consistent with the GEF Operational Strategy for climate change. The PDF phase will identify fully
the barriers; analyse how they can best be removed; undertake assessments of parameters which
contribute to the achievement of targeted goals; obtain the involvement of the private sector and
government; and determine financial sustainability and consumer acceptance. It will also ensure that
a large number of stakeholders are consulted and included in the project and their feedback is
incorporated into the project’s design. The institutional arrangements for the larger project will need
to be clarified through the PDF work. In other words, the development of the full project will be
guided and determined by the outcome of those activities.
Given its promotion of self-sustaining practices, this project has the potential to significantly
assist the Government of India assist in reducing its emissions of GHGs on a replicable basis.
17. Budget
The proposed estimated budget for the PDF-B activity is US $ 340,000. Out of this, a grant
of US $ 280,000 is requested from UNDP/GEF. The break-up is given in the following table. All
costs are in US $
S. No
Budget head
1.
2.
3.
Project Personnel
International Experts*
International travel
Local travel
National professionals
Total Budgetary
requirements
PDF-B Grant
sought
45,000
33,000
39,000
45,000
22,000
25,000
10
4.
5.
6.
7.
8.
9.
Local Consultants/Field Experts
National project personnel
Subcontracts: survey of STEEL
REROLLING units in the country
Seminars & Workshops
Reporting costs
Sundry
67,000
40,000
50,000
42,000
40,000
40,000
50,000
10,000
6,000
50,000
10,000
6,000
Total 340,000
Basis of the various estimates is provided in Annexure - 9
280,000
11
Annexure
1.
DISPERSAL OF RE-ROLLING UNITS ACCORDING TO CAPACITY
Region
Upto 5000
TPA
164
99
53
111
427
North
South
East
West
Total
2.
5001
–
10000 TPA
70
22
21
96
209
10001
–
30000 TPA
134
69
75
84
362
30001
–
50000 TPA
46
22
12
17
97
Above
50000 TPA
31
13
11
17
72
Small Scale
4805 (361 no.)
1553 (164 no.)
1956 (143 no.)
1924 (215 no.)
10238 (883 no.)
10.2 mil. TPA
11550
445
225
172
325
1167
(‘000 T)
CAPACITY OF RE-ROLLING UNITS
Region
North
South
East
West
Total
CAPACITY
AVERAGE
CAPACITY
UNIT
Total
Medium/Large Scale
3292 (84 no.)
2013 (61 no.)
1035 (29 no.)
2809 (110 no.)
9149 (284 no.)
9.1 mil. TPA
32050
Total
8097 (445 no.)
3566 (225 no.)
2991 (172 no.)
4733 (325 no.)
19387 (1167 no.)
19.4 mil. TPA
16625
PER
3. NO. OF PERSONS EMPLOYED PER THOUSAND TONNE OF INSTALLED CAPACITY
Region
Upto 5000
TPA
North
South
East
West
All
Regions
8.97
16.24
12.23
12.36
11.49
500110000
TPA
4.40
5.68
5.11
6.34
5.49
10001
– 30001
30000 TPA 50000
TPA
2.61
2.33
3.96
3.08
3.19
1.88
3.47
4.59
3.18
2.85
– Aabove
50000 TPA
2.04
2.81
3.09
2.13
2.35
ALL
2.81
4.20
3.46
4.30
3.52
12
4. TOTAL EMPLOYMENT IN RE-ROLLING INDUSTRY
Region
North
South
East
West
Total
Managerial/Skilled
12392
6363
5640
9373
33768
Unskilled
10321
8600
4653
10983
34557
Total
22713
14963
10293
20356
68325
4. ENERGY CONSUMPTION PATTERN IN RE-ROLLING MILLS (NO. OF UNITS)
A. ELECTRICITY (KWH/TONNE
10-99
100-150
151-200
201-250
251-300
ABOVE 300
TOTAL
NORTH
74
117
49
40
34
61
375
SOUTH
18
62
41
33
21
43
218
EAST
10
26
31
11
12
23
113
WEST
25
90
34
48
53
29
279
TOTAL
127
295
155
132
120
156
985
26
42
15
9
92
10
4
5
6
25
32
110
25
11
178
189
316
52
37
594
7
25
52
23
17
124
17
23
24
30
34
128
8
21
72
19
17
137
47
116
231
86
76
556
A. FURNACE OIL (LITRES/TONNE)
10-50
51-75
76-100
ABOVE 100
TOTAL
121
160
7
11
299
A. COAL (KGS/TONNE)
10-100
101-200
201-300
301-400
ABOVE 400
TOTAL
15
47
83
14
8
167
6.
AVERAGE CONSUMPTION PATTERN OF REPORTED UNITS
Region
Electricity
Furnace Oil
Coal
(kwh/t)
(Litres/t)
(kgs/t)
North
165
56
226
South
192
66
269
East
190
60
264
West
186
65
264
All India
180
61
253
7. PROBABLE AREAS OF ENERGY SAVING IN RE-ROLLING SECTOR
13
Furnace Oil Based Units
Areas
Existing
STEEL
REROLLING
Norms/Practic
e in India
Targeted
Norms
Remark*
(Basis is field Survey)
HOUSE KEEPING
Control/elimination of Very
much Scope of ‘Zero’ Improper handling & operational
leakage
existent
leakage
practices. Or losses in range of 12% (approx)
Augment oil preheat Inadequate
Considerable
Majority of the units studied.
capacity
with
scope
of
requirement
improvement
Proper
design
of Inadequate
Considerable
About 50% of the units studied
ringman system
scope
of
improvement
Proper
temp.
& Irregular
Standardisation Aabout 50% of the units studied
pressure of furnace oil
of
oil
combustion
practices
Replacement of locally
Saving may be Majority of the small scale units
made
ill
designed
5 – 10%
studied
burners,
nozzles,
blowersets with stateof-art equipment
Improvement
in 50 – 100%
90%
About 4% oil saving for every
COVER RATIO
10% increase in cover ratio
Availability
Operational
Japanese practice: 90 – 95%
Maintenance
5-15%
Fuel saving measured as 15% for
Down time
every 10% improvement
10-30%
85%
Avail. 55-85%
Hot start temperature
1000-1100 C
Reduction of According to our experience 30
min. 50 C
Mcal saving per 100 C reduction in
hot start
PROCESS DESIGN
10 – 100%
5 – 15%
Replacement of low tech LAP
Reduction in Excess
burners with high tech LAP ‘film’
Air
burners with wide turn down
ratios. In some moderate to large
sized RHFs, contemplate using
Oxy-fuel burners
Waste Gas Temperature 600 – 1000 C
< 600 C
Dry gas heat loss varies 35-50%.
Fuel saving (at 20% excess air) is
estimated at 4% for 100 C
reduction
Combustion
Air 35 – 350 C
350 C
About 5% reduction in f.o.
Preheat
consumption (30 MCal for every
100 C increase in degree of pre-
14
Improved
Furnace
Insulation (Ceiling +
Side Wall)
Process Efficiency
Hot
charging
of
billets/slabs
(Applicable
to
composite mills only)
Yiled of Rolled Product
from Ingot/Billet
heat by installing and/or modifying
suitable recuperater
75
mm Use of ceramic Estimated saving in the range of 30
Insulating
fibre etc
– 40 M Cal per T of rolled product
brick
due to heat conservation and
reduction in storage heat loss.
Low
speed 2-4%, 40% &
This is attributable to vintage
mills
(less 80%
factor. Modern mechanised mill
than
3.5 To raise to an has shorter rolling cycle therefore
m/s=25to40% optimum level
higher process efficiency. Some
High
Speed
debottlenecking is required in
Mills
(over
vintage mills to improve process
8.5 m/s =
efficiency – an important measure.
75to90%
respectively
Practically
25.0%
Estimated saving of 20 M Cal per
non existent
70% Ratio
100 C increase in hot charge. This
650 C
requires replacement/modification
of existing RHFs to intermediate
charge furnaces for optimum
results.
86-94%
3.0%
Pro-rata saving
improvement
COAL IN RHF
HOUSE KEEPING
Optimisation of Coal Generally
Size
large 4-5”
There is a
potential scope
of
improvement
between
1020%
Wetting of Coal
Either
not
done & if
done
excessive
Introduction
of Inadequate
secondary air wherever practice
&
not there & with proper control
control of direction &
amount
Improvement on coal High
consistency
fluctuations
on day to day
bais
Improvement
in Mostly C or D
calorific value of coal
grade
Proper size of the Unsynchronis
blower
w.r.t.
coal ed with the
15
quality
coal quality &
excess air
Control of bed height High
vis-à-vis
charging frequency of
frequency
charging visà-vis higher
bed height.
Increase in draft
Generally on
lower side
Cover Ratio
50-100%
Possible
to Commensurable saving in coal
achieve
over consists as in case of furnace oil
90%
Availability of %age
55-85%
Possible
to -doachieve
over
85%
Reduction in Hot Start 1000-1100 C
Possible
to -doTemperature
achieve
reduction
in
Hot Start temp.
By 50 C
PROCESS & DESIGN
Waste gas temperature
500 – 1000 C
Achievable <
500C
Combustion Air Pre- 35 – 350 C
Achievable
heat
upto 350 C
Improved
furnace The same as -doInsulation
enumerated in
case of oil
fired RHFs
Process efficiency of -do-doSTEEL REROLLING
Yield
of
Rolled -do-doProduce
Hot charging
-do-doPulverised Coal fired Very
few PCF
burners
Burner
RHFs.
bring
about
Only
large most efficient
sized
above combustion of
30000 TPA
even low grade
coals
as
characteristic
of India
-do-do-do-
-do-do-doWith smaller sizes of STEEL
REROLLINGs, coal handling,
crushing & pulverising become
expensive,
therefore
not
extensively employed.
POWER USE IN STEEL REROLLINGs
Power
factor 0.75 – 0.90
improvement
PLF improvement
0.50
Achievable = 0.95
Achievable = 0.75
16
Improvement
availability
utilisation
in
&
Adoption of various
measures,
controls,
etc. such as suggested
as on left can result in
reduction in specific
power consumption
levels to extent of 4042%
Load calculations & Conventional
improved
Roll
Process design
Reduction in number
of passes. Adoption
of appropriate RM
practice for example
slab rolling
Improvement in Mill Conventional 2 Hi & Modifying design to
Design
3 Hi
prestressed, 3 Roll,
Conical Mill with
triangular
pass,
sizeless rolling with 4
Roll stand, etc.

Data taken is very approximate based on study of limited number of units at different times.
8. TARGETED REDUCTION IN CO2 EMISSIONS AND FUEL CONSUMPTION BY THE
YEAR 2000 AD IN STEEL RE-ROLLING INDUSTRY
Project is designed to result in both direct and indirect gains at 55% capacity utilisation of the
Sector.
A. DIRECT (Resulted from direct fuel saving):
Specific Furnace oil consumption reduced
from 60.5 Lit to 30 Lit, Coal from 250 kg to 150 kg and Power from 160 KWH to 109 KWH
Fuel
Capacity
Production
Fuel Saved
Primary
Energy Saved
(Mill te)
(Mill te)
(KL/KT)
Furnace Oil
11.64
6.53
199200
7.9
0.6
Coal
7.76
4.09
409
9.4
0.9
Power
19.4
10.62
596
8.0
1.2
Total
19.4
10.62
25.3
2.7
(PJ)
CO2
Emissions
Avoided
(Mill te)
A. INDIRECT (Resulted from yield improvement):
Project is designed to improve the yield of rolled product by a minimum of 3.0% i.e., from 90 to
93%. Input material (ingots/billets) saved = 0.4 mill. Tonnes. These inputs are currently being
sourced from EAF / IF based plants and integrated steel plants in ratio of 75:25. Materials &
Energy saved together with CO2 emissions avoided are given as follow:
17
Source of Inputs
Material (inogt/billet Primary
steel) saved
saved
Emissions
(Mill. Tonnes)
(PJ)
(Mill. Tonnes)
0.3
2.8
0.4
Steel 0.1
2.7
0.5
0.4
5.5
0.9
EAF/IF Units
Integrated
plants
Energy CO2
avoided
Total
In Indian scenario
Energy Consumption
C-Emission
-
-
EAF
=
2.2 GCal/Te
-
ISP
=
6.5 GCal/Te
EAF
ISP
=
=
170.5 Kg/GCal
194.0 KG/GCal
A. ANNUAL FUEL SAVING
Furnace Oil
Coal (for furnace)
Coal (for Power)
Total
Annual
Fuel Saving
D.
DIRECT
KL/KT
199200
409
596
INDIRECT
KL/KT
5030
96
231
TOTAL
204230
505
827
FUEL SAVING
Million US $
40.85
11.90
19.45
72.20
Summary of Material & Energy Saved, CO2 Emissions Avoided and Cost Benefit to the
Re-rolling Sector
Material Saved
DIRECT
(i) Oil
(ii) Coal
(iii) Power
Total Direct
INDIRECT
Yield
Improvement
Grand Total
CO2 Emissions
Avoided
(Mill. Tonnes)
Cost Benefit
Mill. Tonne)
Primary Energy
Saved
(PJ)
-
7.9
9.4
8.0
25.3
0.60
0.90
1.20
2.7
39.80
9.60
50.9
100.3
0.4
0.4
5.5
30.8
0.90
3.6
129.0
229.3
(Mill. US $)
Yield improvement results in additional finished steel of 3,72,000 Te which is currently priced
between Rs.14,500 and Rs.15,000 or US $ 347/Te. Total cost benefit is $ 21.6/Te which works out to
nearly 46% of the value addition by the Re-rollers.
Notes:
1.
Prices: Furnace Oil @ Rs.8500/KL, Thermal Coal @ Rs.1000/Te, Power @ 4000/MWH
18
Exchange Rate 1 US$ = Rs.42.50
2.
The total cost benefit in direct monetary terms will be US $ 229.3 Million
(Direct 100.3 and Indirect 129.0 Million US $)
19
Annexure - 9
Basis of the Budget Estimates
Item 1 -
International Experts -
45 man-days provided @ US $ 1000 per day.
Item 2 -
International Travel
-
3 Field Trips of 10 days each provided.
2 field trips for visits of the international experts &
1 field trip for domestic experts overseas. The cost
of travel of the visits of Indian experts abroad to be
borne by the Project Implementation Office.
Item 3 -
Local Travel
-
Total trips are estimated at about 130. Visits of
field experts to steel rerolling units constitute 40,
meetings at central & state levels including
review meetings constitute 40 and seminars and
workshops constitute 50.Based on actual
experience, each travel costs @ US $ 300 each
on an average, which includes air/train travel plus
local conveyance. From this, cost of 45-50 travels of
experts from the Offices of the DCI&S and PSUs is
proposed to be borne by the Project Implementation
Office.
Item 4 -
Local Consultants
-
About 1000 expert man-days from 6 identified
different consulting organisations in different areas
of their expertise such as combustion, roll-pass
design, mill design, neural networking and virtual
rolling, technology management, etc. are estimated
to be required. This comprises of 600 man-days of
field work, 250 man-days of seminars, workshops &
training and remaining for assisting project office in
preparation of a strategy report and a project brief.
Item 5 -
National Project
Personnel
-
This is the cost of the National Project Manager,
Cost & Financial Expert and Chief Technical
Adviser. The latter is also supposed to act as a SubProject Manager in lieu of the technical and
geographical diversity of the steel rerolling sector.
Period is 12 months.
Item 6 -
Survey of steel rerolling
Units
-
Mainly on account of the cost of the
hired/purchased equipment, testing facilities, etc.
for 25 units on actual basis.
Project Office
undertakes to bear 20% of this cost.
20
21