Client Context

The client is a top-10 Indian steel producer operating integrated steel plants with a combined crude steel capacity of approximately 5 million tonnes per annum (MTPA). The primary production route is blast furnace–basic oxygen furnace (BF-BOF), supplemented by a smaller electric arc furnace (EAF) operation at one facility. The company operates across three manufacturing sites in two Indian states, with captive power generation (coal-based thermal) at each location.

The client has a well-established sustainability function and files annual Business Responsibility and Sustainability Reports (BRSR) as required by SEBI for listed entities. The company participates in the PAT Scheme and has achieved ESCert surpluses in recent PAT cycles. It reports to CDP and has publicly disclosed a commitment to reduce carbon intensity by 25% by 2035 against a 2020 baseline.

Despite this foundation, the client’s emissions data infrastructure was designed for corporate-level sustainability reporting — not for the facility-level, process-specific MRV that India’s Carbon Credit Trading Scheme (CCTS) demands.

The Challenge

The Bureau of Energy Efficiency’s (BEE) MRV guidelines, published in April 2026, require obligated entities to submit facility-level GHG inventories covering Scope 1 and Scope 2 emissions, quantified at the installation level using approved emission factors, with documented uncertainty analysis and third-party verification. This represents a fundamentally different data requirement from the client’s existing reporting practice.

Specifically, the client faced four critical gaps:

1. No facility-level GHG inventory. The company’s BRSR and CDP disclosures reported consolidated Scope 1 and Scope 2 emissions at the corporate level. There was no disaggregation by plant, production unit, or process step — the level of granularity required by CCTS.
2. Emission factor inconsistency. Different reporting frameworks used different emission factors. The BRSR submission used IPCC default values; the PAT assessment used BEE-specified thermal conversion factors; and the CDP response used a hybrid approach. None aligned precisely with the CCTS emission factor database published by BEE.
3. Incomplete source mapping. The BF-BOF steelmaking route involves over 30 distinct emission sources across coking, sintering, blast furnace operation, BOF steelmaking, continuous casting, and rolling. The client’s existing inventory captured major sources but had not systematically identified and quantified all process, fugitive, and mobile combustion sources.
4. No verification readiness. The company had never undergone a third-party GHG verification to ISO 14064-3 standards. Documentation, evidence trails, and internal quality controls were insufficient to support an external verification engagement.

The client recognised that without a comprehensive MRV system, it would be unable to demonstrate compliance with CCTS requirements and — equally critically — would be forced to rely on conservative default values for CBAM reporting to its European customers, potentially overstating its emissions by 15–20%.

Our Approach

RSustain deployed a four-person team over 14 weeks across the client’s three facilities. The engagement followed a structured methodology aligned to ISO 14064-1:2018 and calibrated to the specific requirements of BEE’s CCTS MRV guidelines.

Phase 1: Source Mapping and Boundary Definition (Weeks 1–3)

We began with a comprehensive source mapping exercise at each facility. Using process flow diagrams, piping and instrumentation diagrams (P&IDs), and facility walkthroughs, we identified and categorised every GHG emission source by type (stationary combustion, process, fugitive, mobile) and by production unit. For the BF-BOF route alone, we mapped 34 discrete emission sources across the value chain from raw material handling through to finished product dispatch.

Organisational and operational boundaries were defined in accordance with ISO 14064-1, using the operational control approach. Each facility was treated as a separate reporting unit, with shared services (e.g., captive power, oxygen plant, water treatment) allocated based on metered consumption data where available and engineering estimates where metering was absent.

Phase 2: Activity Data Collection and Emission Factor Selection (Weeks 4–8)

For each identified source, we specified the required activity data (fuel consumption, material throughput, electricity consumption, etc.), the data source (meters, weighbridges, invoices, production logs), the measurement frequency, and the applicable emission factor. Emission factors were selected in the following hierarchy, consistent with BEE guidance:

1. Plant-specific measured values (e.g., coal calorific values from proximate analysis)
2. BEE CCTS emission factor database values
3. India-specific factors from CEA, Coal Controller, or Petroleum Planning and Analysis Cell
4. IPCC 2006/2019 Refinement default values (used only where no India-specific data existed)

A critical finding during this phase was that the client’s coal consumption data — which drives the single largest emission source in BF-BOF steelmaking — was recorded at the procurement level (as-received basis) but not consistently adjusted for moisture content, ash content, or calorific value variation across coal grades. We worked with the client’s raw materials team to establish a protocol for quarterly proximate and ultimate analysis of all coal grades, enabling plant-specific emission factors to be derived.

Phase 3: Uncertainty Analysis (Weeks 9–10)

Following IPCC Tier 2 uncertainty assessment methodology, we quantified uncertainty for each emission source based on activity data uncertainty (measurement accuracy of meters, scales, and analytical equipment) and emission factor uncertainty (variability in coal quality, process conditions, etc.). The combined uncertainty for Scope 1 emissions was estimated at plus or minus 6.8% at the 95% confidence interval for the primary BF-BOF facility — within the acceptable range for CCTS compliance but highlighting areas where metering upgrades would improve data quality.

Phase 4: Documentation, Procedures, and Gap Analysis (Weeks 11–14)

We compiled the complete GHG inventory for each facility in a format designed to withstand third-party verification scrutiny. Deliverables included a GHG Management Plan, a Monitoring and Data Management Procedures Manual, a Data Quality Management Plan, and verification-ready GHG statements for each installation. Concurrently, we conducted a CCTS gap analysis, mapping the client’s current state against each requirement in BEE’s MRV guidelines and identifying the remaining actions needed for full compliance.

Deliverables

• Verification-ready GHG statements for three facilities, covering Scope 1 (34 sources) and Scope 2 (grid + captive power), quantified at 12.4 MtCO2e aggregate (FY 2025–26 baseline year)
• MRV Procedures Manual (148 pages) covering data collection, quality assurance, calculation methodologies, roles and responsibilities, and record retention requirements
• CCTS Gap Analysis Report identifying 11 compliance gaps with prioritised remediation actions — 7 addressable within 3 months, 4 requiring capital investment (metering upgrades) within 6–9 months
• Emission factor database — plant-specific factors for 18 fuel and material inputs, replacing generic defaults
• CBAM data package — installation-level emissions data reformatted per EU CBAM Implementing Regulation methodology for two product categories (hot-rolled coil and structural sections)

Outcome

The client’s GHG inventory and supporting documentation passed a pre-assurance review conducted by one of India’s leading verification bodies (empanelled under BEE’s DVA framework). The review identified three minor corrective actions — all related to documentation completeness rather than methodological issues — which were resolved within two weeks.

Critically, the detailed source mapping and plant-specific emission factor analysis identified a 12% emission reduction potential through three interventions: optimisation of the coke rate in the blast furnace (estimated 4.2% reduction), increased use of waste heat recovery from the sinter plant (estimated 3.8% reduction), and replacement of coal-based captive power with renewable energy procurement for non-process electricity loads (estimated 4.0% reduction). These abatement opportunities, valued at approximately INR 180 crore per annum at an internal carbon price of INR 1,200 per tCO2e, provided a business case for decarbonisation investments that extended well beyond regulatory compliance.

The client is now positioned to enter the first CCTS compliance period with a robust, verified emissions baseline and a clear roadmap for both compliance and strategic decarbonisation. The CBAM data package has been shared with three EU importers, replacing default value estimates and enabling the client to demonstrate actual emissions 18% below EU defaults — a competitive advantage estimated at EUR 8.5 million per annum in avoided CBAM duties.