Embracing CCUS: How Prepared are Industries like Green Hydrogen, Petrochemicals, and Coal Gasification
While India is advancing its efforts to shift to renewable energy intently, CCUS development and integration are still in the early stages. It is limited to the pilot and demonstration phases due to the lack of a comprehensive policy, underdeveloped infrastructure, and high costs.
October 16, 2025. By News Bureau
As India moves forward with its ambitious goal of decarbonising energy by 50 percent and achieving 500 GW of fossil fuel–free generating capacity by 2030, it faces the colossal task of managing carbon emissions from its existing energy and industrial structure. In this effort, the expected INR 38,900 crore CCUS programme reported to be announced by the government would be a crucial catalyst in accelerating carbon capture and utilisation, particularly in carbon-intensive industries such as green hydrogen, petrochemicals, and coal gasification.
The Carbon-Intensive Industries
While India is advancing its efforts to shift to renewable energy intently, CCUS development and integration are still in the early stages. It is limited to the pilot and demonstration phases due to the lack of a comprehensive policy, underdeveloped infrastructure, and high costs. The same remains true for carbon-intensive sectors like green hydrogen, petrochemicals, and coal gasification, where managing emissions is impossible through other means.
The petrochemical industry is a significant, advanced, and well-established sector in India. It is undergoing robust growth, with the current market size estimated to be around USD 220 billion in 2024 (chemical and petrochemical cumulative), contributing approximately 6 percent to the nation’s GDP. Considering the growth graph, the market size is expected to touch new heights in the future.
Another truth is that the petrochemical and chemical industries together account for about 18 percent of direct industrial emissions globally. And as the industry advances, so will carbon emissions and the exigency to curb them. Some prominent petrochemical companies based in Jamnagar and Hazira have embraced CCUS, but widespread adoption will take time.
The other two sectors—coal gasification and green hydrogen—are still in the development phase. Both hold significant potential but require further technological advancement and infrastructure development to achieve large-scale commercial viability.
Policy Challenges and Possible Solutions
To achieve the Net Zero 2070 goals, India has outlined a CCUS target of 750 mtpa by 2050, which will be executed in a phased manner. However, this target alone will not suffice. The country needs a comprehensive approach addressing policy support, technology deployment, and infrastructure development to ensure meaningful progress. India does have immense potential to become a global CCUS hub; the success trajectory and pace will be determined by a progressive policy.
In the current scenario, industries need policy support and a sustainable market for CCUS projects. Realising CCUS in India will require a combination of direct capital support, tax breaks, carbon pricing mechanisms, operational subsidies, regulatory frameworks, and priority procurement of low-carbon goods. A key focus of the plan should also be on placing CO₂-utilising industries close to CO₂-emitting sectors to create a cost-efficient loop for capture, transport, and utilisation.
Turning Carbon Capture into Value
Industries like petrochemicals and coal gasification generate concentrated CO₂ streams, which makes them relatively better suited to adopt CCUS. Integration of CCUS into synthetic fuel pathways is feasible and presents a readily available opportunity to initiate a green revolution in this sector.
Policy and incentivisation are one part of CCUS; the other one is turning them into a valuable asset. The overarching plan should also include capturing carbon and converting it into value in a cost-effective manner.
In this case, India should embrace a dual strategy of carbon storage as well as utilisation. While geological storage ensures the capacity and durability needed for deep decarbonisation, utilisation pathways unlock economic value and lower initial investments. Both in the short and long term, utilisation will remain a crucial factor influencing decision-makers, particularly private players, when determining whether to invest in CCUS. For large IPPs, storage should be treated like a peaking plant, used only when demand exceeds supply. Our main focus should be on creating demand through utilisation, keeping storage needs to a minimum. Storage is costly and doesn’t directly contribute to returns, so real ROI is only achieved when the captured carbon is put to use.
Captured carbon can be converted into methanol using either homogeneous or heterogeneous catalysts. The pilot-scale projects of this have shown immense success. The challenge is the initial capital, which is high and needs to be managed. Another option is converting carbon to ethanol, which is technically feasible but has yet to be demonstrated at scale.
India’s readiness for CCUS technologies in any industry, including carbon-intensive sectors like green hydrogen, petrochemicals, and coal gasification, is progressing, but it needs more support and a clear policy framework from the government. The uncertainty about the policy, utilisation of captured carbon, and financial support is what keeps many industries, even those willing to embrace it, hesitant. All hope is from the CCUS programme that is anticipated to be announced by the government in the near future, for clarity and much-needed encouragement.
- Surbhi Puri, Director at Green Power International Pvt. Ltd.
please contact: contact@energetica-india.net.
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