SMALL AND MEDIUM ENTERPRISES: ENERGY EFFICIENCY KNOWLEDGE SHARING VOLUME 15 | ISSUE 2 | JUNE 2024
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Inside...
Profile of Sundergarh Secondary Steel Cluster
Energy assessment studies on secondary steel
industries in Sundergarh
23rd meeting of SAMEEEKSHA
VISION
SAMEEEKSHA envisages
a robust and competitive
SME sector built on strong
foundations of knowledge
and capabilities in the
development, application,
and promotion of energy-
efficient and environment-
friendly technologies.
A PL ATFORM FOR PROMOTING ENERGY EFFICIENCY IN SMEs
IN THIS ISSUE…
This issue has as its theme the studies undertaken by TERI on the secondary steel cluster in Sundergarh district of Odisha,
under the project supported by the SED Fund. This project contributes to and synergizes with the larger ongoing initiative
to find actionable pathways by which the Indian iron and steel sector can achieve energy transition away from fossil fuels
towards low-carbon technological options.
The first article summarizes the findings of a cluster-level situation analysis of the Sundergarh secondary steel sector,
including the various categories of units that are in operation; their primary technologies, raw materials, energy sources, and
end-products; and the energy consumption levels by industry category. It also summarizes a number of energy conservation
measures (ECMs) that can be adopted by the different categories of units.
The second article presents a number of these ECMs and their potential benefits in more detail, based on plant-level studies
conducted by TERI in a total of 14 secondary steel units falling under three categories: (1) steel melting units using electric
induction furnaces (EIF); (2) steel rerolling mills (SRRM); and (3) plants producing direct reduced iron (DRI). The article
underlines that implementation of these ECMs can bring significant benefits to the units in terms of energy and cost savings,
and that they offer attractive simple payback periods (SPP) on investments— in many cases, within a few months.
The issue concludes with a summary of the discussions during the 23rd meeting of SAMEEEKSHA platform held on 7th June
2024 at Pune.
SAMEEEKSHA Secretariat
CLUSTER PROFILE
PROFILE OF SUNDERGARH
SECONDARY STEEL CLUSTER
Overview • Rourkela Chamber of Commerce and Industry,
Rourkela
The state of Odisha has vast mineral reserves including
• Utkal Chamber of Commerce and Industry Limited
iron ore and coal, along with a significant number of
(UCCIL), Bhubaneshwar
operating mines. Considering the ready availability
of these raw materials, a large number of iron & steel • District Industries Centre, Sundergarh
industries have been established in Odisha including • MSME Development & Facilitation Office, Cuttack
public sector undertakings such as Steel Authority • National Small Industries Corporation (NSIC),
of India Limited (SAIL), Rourkela— an integrated steel Rourkela
plant. Odisha is also the leading steel producer among
all Indian states: its steel production during 2021–22
was 23.72 million tonnes (MT), witnessing about Technology
7.5% growth during 2017–2022. The Keonjhar district The following are the main categories of secondary
contributes about 31% of the total iron ore mined steel industries in Sundergarh.
in the state, followed by Sundergarh district which
contributes 20% of the total. • Pellet plants, which use induration furnaces to
process iron ore into pellets.
The Sundergarh district has a large cluster of secondary • Direct reduced iron (DRI) industries, which use
steel industrial units, most of which are situated in the rotary kilns to produce sponge iron from iron ore/
industrial estates of Rourkela, Kalunga, Mandiakudar, pellets.
Rajganjpur, and Sundergarh. TERI conducted a
situation analysis of the secondary steel units in the
Sundergarh cluster under a project supported by the
SED Fund. There are about 87 registered secondary
steel units operating in the cluster, of which about
40 are ‘composite’ units having multiple process
steps integrated within the same plant, while the
remaining 47 are ‘stand-alone’ units having a single
process step. In composite units, the end-products
from a process step are used as input raw materials
in subsequent process steps; while in stand-alone
units, they are marketed as the final products for use
by other downstream industrial units. About 52 units,
Pellet plant, rotary type
comprising large-scale plants as well as MSMEs, have
energy consumption levels of 20,000 tonnes of oil
equivalent (toe) or more annually and are categorized
as Designated Consumers (DCs) under the Perform,
Achieve and Trade (PAT) scheme of the Bureau of
Energy Efficiency.
A number of industry associations are active at
cluster and state levels in addressing issues pertinent
to the Sundergarh secondary steel cluster, such as
facilitating networking among members, providing
technical support by organizing training programs
and workshops, and so on. The prominent industry
associations and other important stakeholders are
listed below.
• Orissa Sponge Iron Manufacturers Association
(OSIMA) Rotary kiln in DRI plant
2 SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024
CLUSTER PROFILE
ferro manganese, silicon manganese, ferro silicon,
chrome alloys, etc. that are used in the production
of alloy steels.
Table 1 summarizes the main categories of secondary
steel industries.
Table 1: Categories of secondary steel industries in
Sundergarh cluster
Category Units By process step(s) By energy
(no.) consumption
Stand- Composite DC Non-
alone DC
Pellets 1 – 1 1 –
DRI 41 29 12 25 16
Steel melting industry: continuous casting MBF 2 – 2 1 1
machine (CCM) EIF 25 9 16 16 9
SRRM 16 9 7 7 9
Ferro 2 – 2 2 –
alloy
Total 87 47 40 52 35
Table 2 shows the primary technologies deployed by
different categories of secondary steel units, along
with the primary raw materials used, the sources of
energy, and the end-products.
Table 2: Primary technologies, raw materials, energy
sources, and end-products
Ferro alloy industry
Category Primary Raw Energy End-
• Mini blast furnace (MBF) units, which produce pig technology materials sources products
iron or liquid iron from iron ore/pellets. Pellets Induration Iron ore, FO, coal, Pellets
furnace fluxing coke,
• Steel melting industries using electrical induction material, electricity
furnaces (EIF) for producing molten (liquid) steel bentonite
from sponge iron and scrap. These units are of
DRI Rotary kiln Iron ore/ Coal, Sponge
two types: (1) composite plants having integrated pellets, electricity iron
facilities for producing rolled steel products through dolomite
hot charging route, using continuous casting
MBF Blast Iron ore/ Coal, Liquid
machines (CCMs) for processing the liquid steel furnace sinter/ electricity iron, pig
directly, and/or through cold charging route, using pellets iron
reheating furnaces for bringing ingots and billets
EIF EIF, Sponge Electricity Ingots &
to the required temperatures for rolling; (2) stand- continuous iron, billets
alone plants that undertake bottom-pouring of the casting scrap,
liquid steel to make solid billets and ingots, which are machine alloying
marketed for use as raw materials by downstream (CCM) elements
industries. SRRM Reheating Ingots & Coal, Rolled
• Steel re-rolling mills (SRRM), which produce rolled furnace, billets electricity products
steel products from steel ingots and billets using: rolling
machinery
(1) reheating furnaces to preheat the ingots and
billets; (2) rolling machinery to make the rolled steel Ferro Submerged Mineral Electricity Alloying
products from the heated billets/ingots. alloy arc furnace ores elements
• Ferro alloy industries, which use submerged arc
furnaces to produce alloying elements such as
SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024 3
CLUSTER PROFILE
Energy use • Switchover to coal gasification in place of solid coal
firing
The total energy consumption by the MSME secondary
• Heat treatment using gas route, e.g., natural gas
steel units in the Sundergarh cluster is estimated at
1.86 million tonnes of oil equivalent per year (Mtoe/y), DRI
of which thermal energy from fossil fuels accounts for
• Waste heat recovery (WHR) system for captive power
about 93% (1.73 Mtoe/y), and electricity the remaining
generation, and/or iron ore preheating
7% (0.13 Mtoe/y) as summarized in table 3. The DRI
industries account for nearly 70% of the total cluster- • Coal gasification for partial substitution of coal by
level energy consumption. gas in the rotary kiln
• DRI production using gas route, e.g. natural gas,
Table 3: Energy consumption by MSME secondary steel
hydrogen, etc.
units in Sundergarh cluster
• Improved insulation and use of better material in
Category Energy consumption (Mtoe/y) refractory lining in rotary kiln
Thermal Electricity Total
Steel melting (EIF)
Pellets 0.03 – 0.03
• Installation of scrap-bundling system
DRI 1.25 0.02 1.27
• Adoption of continuous casting and direct hot
BF 0.44 0.01 0.45 charging for rolling system
Steel melting (EIF) – 0.09 0.09
Steel rerolling mills
SRRM 0.003 0.005 0.01
• Installation of coal gasification system
Ferro alloy 0.003 0.009 0.01
• PLC-based automatic fuel-firing system
Total* 1.73 0.13 1.86
• Adoption of waste heat recovery (WHR) system
* rounded off
• Switch over to gas-fired system, e.g. natural gas
• Electrification of reheating furnaces
Potential energy conservation • Adoption of continuous casting and direct rolling
measures
The study helped identify a number of energy
Common ECMs
conservation measures (ECMs) that can be adopted by Other significant ECMs that can be adopted by all
the different categories of secondary steel industries, categories of secondary steel industries include:
as summarized below. The next article in this issue • Variable frequency drives (VFD) for variable motive
describes a few ECMs and their potential benefits in loads (blowers, air compressors, etc.)
more detail, based on plant-level studies conducted in • Replacing inefficient (rewound) motors by energy-
three categories of secondary steel units: (1) DRI, (2) efficient (IE3 /IE4) motors
EIF, and (3) SRRM.
• Adopting best operating practices in compressed air
Pellets systems such as arresting compressed air leakages,
and optimizing the air pressure settings
• Adoption of circular grate technology for heat
• Installation of multi-stage centrifugal pumps for
treatment
cooling water systems
• Optimization of hearth layer height
• Installation of solar photovoltaic (SPV) systems
• Oxygen enrichment in combustion air
4 SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024
STUDY
ENERGY ASSESSMENT STUDIES ON SECONDARY
STEEL INDUSTRIES IN SUNDERGARH
TERI conducted energy assessment studies on a total
of 14 secondary steel industrial units in the Sundergarh
cluster, under a project supported by the SED Fund.
This project contributes to and synergizes with the
larger ongoing initiative to find actionable pathways
by which the Indian iron and steel sector can achieve
energy transition away from fossil fuels towards low-
carbon technological options, through cluster-level
interventions in selected secondary steel clusters
across the country.
The units that were studied fall under three categories:
(1) steel melting units using electric induction furnaces
(EIF); (2) steel rerolling mills (SRRM); and (3) plants
producing direct reduced iron (DRI), as shown in table
1. Detailed energy assessment studies were carried out
on each of the units, in order to study the technologies Energy assessment study under way
and processes being used; assess the potential for
reducing energy and resources consumption in
different process areas; and identify and quantify the
benefits of energy conservation measures (ECMs)
that can be implemented by the units concerned.
The studies also assessed the potential for installing
rooftop solar photovoltaic (PV) systems for captive
power generation in the steel melting units and SRRMs.
Table 1: Secondary steel units covered by the studies
Category No. of units
Steel melting (EIF) 8
Water flow measurements being taken during study
Steel rerolling mills (SRRM) 3
DRI (sponge iron) 3
the liquid steel from EIF into hot billets, which are sent
Total 14 directly to the rolling section for making rolled steel
products; and (2) stand-alone units that pour the liquid
Snapshots of ECMs steel from EIF to make solid billets, ingots, castings,
etc., which are then marketed for use by downstream
The sections that follow describe, by industry category, steel rerolling mills (SRRMs) and other industries. Three
a few of the important ECMs identified through the of the important ECMs identified for the steel melting
studies. These ECMs offer significant benefits in terms units are summarized below.
of energy and cost savings, as well as attractive simple
payback periods (SPP) on investments— in many cases, 1. Replace low-efficiency pumps with energy-
within a few months. efficient pumps in all cooling water systems
All the eight steel melting units studied have installed
Steel melting units (EIF) cooling water circulation systems for their melting
The eight EIF-based steel melting units that were furnaces (i.e. EIF), and in one case each, for the CCM
studied were of two types: (1) composite units that section and rolling section as well. The studies showed
use continuous casting machines (CCMs) to process significant potential for reducing energy consumption
SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024 5
STUDY
and costs in these cooling systems by replacing the Use lid for furnace crucible
existing low-efficiency pumps with energy-efficient
The studies found that in two steel melting units, the
(EE) pumps. In most cases the simple payback periods
crucible of the EIF was left open to the atmosphere
on investments are less than one year (table 2).
during operation, leading to significant heat losses
Table 2: Installing EE pumps in cooling water systems through radiation and convection. It was recommended
that these two units install locally-fabricated, insulated
Unit Annual Annual Investment SPP* mild steel lids on the crucibles to minimize the heat
no. energy cost (Rs lakh) (years) losses. For one unit, an investment of Rs 6 lakhs on
saving saving (Rs the lid would save Rs 15 lakhs annually, with simple
(million kWh) lakh) payback period (SPP) of less than 5 months; for the
1 0.02 1.3 2.3 1.8 other unit, an investment of Rs 2 lakhs would save Rs
2 0.27 16.4 16.5 1.1 2.3 lakhs annually, with SPP of less than 11 months.
3 0.22 12.6 9.5 0.7
4 0.04 2.4 2.0 0.8
5 0.08 4.2 2.8 0.7
6 0.48 28.0 22.5 0.8
7 0.06 3.6 1.7 0.5
8 0.02 1.7 2.5 1.5
*SPP—simple payback period
2. Install scrap shredder and scrap bundling machine
The studies found that in many units, the EIF was
being charged with scrap materials of assorted sizes
and shapes. This practice increased the heating cycle
time of the EIF and lowered the overall efficiency of the
melting process. It was recommended that the units
install scrap shredders and scrap bundling machines
which will reduce the scrap to uniform size and make it
more compact, thereby reducing energy consumption
and improving process efficiency. The chart depicts
Lid for EIF crucible
the potential monetary benefits of this ECM in six of the
melting units. The payback time on investment varies
from less than four months to just over two years. Steel rerolling mills
All three SRRMs studied use pusher hearth-type
152 reheating furnaces based on pulverized coal to heat
billets to the appropriate temperatures (1100–1150°C)
for further processing into the finished products in the
rolling sections. The reheating furnaces are equipped
118
with waste heat recovery (WHR) systems to recover
heat from flue gases (temperature 600–700°C) for
preheating the combustion air. Two of the important
ECMs identified for the reheating furnaces in these
75 75 units are described below.
Replace recuperator in reheating furnace
58
50 50 50 47 Temperature measurements during the studies
46 showed that the existing recuperators were not
36 37 effective in transferring heat from the hot flue gases
to the combustion air. It was recommended that the
units replace their existing recuperators with new
1 2 3 4 5 6 compatible recuperator systems to achieve significant
Unit energy and cost savings as depicted in the chart, with
Investment (₹ lakh) Cost saving (₹ lakh/year) quick payback on investments (within 4–7 months).
6 SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024
STUDY
did not allow mixing of air and fuel in optimal ratio.
Both units were advised to install automatic furnace
pressure control systems and also replace the existing
burners with swirl burner systems, which would result
in substantial energy and cost savings (see chart).
DRI units
Of the three DRI units studied, one is a large-scale
plant and the other two are MSMEs. In both MSME DRI
units, the studies found that the rotary kilns were using
only about 32% of the total heat input, with a significant
amount of useful heat being carried away by the waste
gases that exited the kilns at a temperature of about
950°C. While the units had installed heat exchanger
systems to cool the exhaust gases before expelling
Recuperator for reheating furnace them to ambient through the chimney, the studies
62 determined that a better option for the units would be
to install power generation systems based on waste
heat recovery boilers (WHRBs), which could use the
heat from waste gases to generate power for captive
43 use as well as export surplus power to the grid (table 3).
Table 3: Installing captive power plants using waste
29 Investment heat from rotary kilns
(₹lakh)
20
16 16 Cost saving Unit Annual energy Annual Investment SPP
(₹lakh/year) no. saving (million cost (Rs lakh) (years)
kWh) saving
(Rs lakh)
1 2 3 1 22.3 893.1 3694.4 4.1
Unit 2 19.8 792.8 3901.2 4.9
Automation of reheating furnace, with installation of
swirl burner
In two of the SRRMs, the draught in the reheating
furnaces was being manually controlled, leading to
improper pressure inside the furnaces. Also, the units
were using locally-fabricated pipe burners which
54
Investment
25 25 25 (₹lakh)
Cost saving Waste heat recovery boiler (WHRB)
(₹lakh/year)
Solar energy options
Among the steel melting units and SRRMs studied,
significant potential exists in nine units to install rooftop
1 2 solar PV systems to meet captive power requirements
and export any surplus power to the grid.
Unit
SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024 7
EVENT
23RD MEETING OF SAMEEEKSHA
The 23rd meeting of SAMEEEKSHA was held in Pune on effectiveness of cluster-level demonstration projects in
7th June, 2024, and attended by around 50 participants spurring the widespread adoption of EE technologies.
including representatives from BEE; Directorate of Mr Abhay Daptardar, Assistant Director, MSME- DFO,
Industries, Pune Region; MSME Development and Mumbai, mentioned that Kolhapur cluster has been
Facilitation Office (MSME-DFO); Maharashtra Energy identified by BEE for pilot EE projects, and suggested
Development Agency (MEDA); Small Industries that other engineering clusters such as Ahmednagar
Development Bank of India (SIDBI); Indo German and Aurangabad be considered for future projects. Mr
Energy Programme of GIZ GmbH (IGEP-GIZ); Shakti S G Rajput, Joint Director of Industries, Pune region,
Sustainable Energy Foundation (SSEF); Institute of spoke on state supportive policies for industry.
Electrical and Electronics Engineers (IEEE), Pune;
Mahratta Chamber of Commerce, Industries and The following presentations were made to guide the
Agriculture (MCCIA), Pune; entrepreneurs; and other discussions that followed:
stakeholders. • Energy Efficiency in Industry and Data—Mr Ayan
In their opening remarks, Mr Girish Sethi, Senior Director, Shubhro Ganguly, Energy Advisor, IGEP-GIZ
TERI, and Mr Prashant Girbane, Director General, • Energy and Resource Efficiency Action Plan (MSME
MCCIA, underlined the importance of organizing Sector)— Mr Neeraj Naik, Project Engineer, BEE
this regional SAMEEEKSHA meeting in Pune, which • Promoting Energy Efficiency in the state of
is a major industrial hub known for its automotive,
Maharashtra— Mr Abhijeet Hinge, Manager, MEDA
engineering, and food processing industries. Dr Sachin
Kumar, Director of Industry, Buildings, and Cooling, • SIDBI’s financing schemes for energy efficiency and
SSEF, pointed to the challenges posed to Pune’s solar rooftop— Mr Rajiv Kumar, General Manager,
automotive component manufacturing industries by Green Climate and Energy Efficiency Centre, SIDBI
the market transition towards electric vehicles (EVs), A few salient points from the presentations and
and suggested that SAMEEEKSHA provides an ideal discussions are listed below.
platform for discussions on how to address these
challenges. • IEEE is willing to associate with MCCIA for awareness
and training programs, including the development
Mr Milind Deore, Secretary, BEE, outlined BEE’s various of course content for MSMEs.
initiatives for promoting energy efficiency (EE) in the
MSME sector and cited examples to underline the • MCCIA is starting an initiative on sustainability for
MSME industries in Pune region, with a target to
support 100 MSMEs for pilot demonstrations.
• Participants suggested that: (1) the Energy Mapping
Studies of BEE may be expanded to cover lean
clusters, as Maharashtra alone has 94 lean clusters
with nearly 900 units; (2) the Ichalkaranji textile
cluster may be considered by BEE for any future EE
project.
ABOUT SAMEEEKSHA
SAMEEEKSHA is a collaborative platform aimed at pooling the knowledge
and synergizing the efforts of various organizations and institutions—Indian For more details, please contact
and international, public and private—that are working towards the common SAMEEEKSHA Secretariat
goal of facilitating the development of the Small and Medium Enterprise Industrial Energy Efficiency Division
(SME) sector in India, through the promotion and adoption of clean, energy- TERI, Darbari Seth Block
efficient technologies and practices. IHC Complex, Lodhi Road,
New Delhi - 110 003, India
SAMEEEKSHA provides a unique forum where industry may interface with Tel: (+91 11) 2468 2100
funding agencies, research and development (R&D) institutions, technology Fax: (+91 11) 2468 2144, 2468 2145
Email: sameeeksha@[Link]
development specialists, government bodies, training institutes, and Website: [Link]
academia to facilitate this process.
8 SAMEEEKSHA NEWSLETTER | VOLUME 15 | ISSUE 2 | JUNE 2024
