However, without a stronger anti-dumping enforcement, imports continue to blunt any sustained price rally through 2026, making the green-tech pivot the only reliable way for metal companies to protect and even expand margins | Photo Credit: bl-online Administrator
All the large metal manufacturers including JSW Steel, Tata Steel, Jindal Stainless, Hindalco Industries and Vedanta Group have ploughed large investments in various green energy projects which are slowly going onstream.
Global steel and mining giant ArcelorMittal recently started supplying clean energy to AMNS India in Gujarat from its 1-gigawatt solar and wind project located in Andhra Pradesh.
JSW Steel has commissioned a 225 MW solar power plant at its Vijayanagar facility to supply power to its steel operations and reduce coal consumption.
Saurabh Jain, Head of Fundamental Research, SMC Global Securities said that metal companies are aggressively banking on green energy and low-carbon technologies not just for sustainability but primarily to slash their single largest cost bucket (power and fuel, often 30–45 per cent of total costs) and to build a durable profit-margin shield in an import-battered market.
win win
By locking in captive solar/wind at ₹2–3/kWh versus grid/coal at ₹7–8/kWh, and by switching to green hydrogen-based DRI or renewable-powered smelters, giants such as Hindalco, Nalco, Tata Steel and JSW Steel are cutting energy costs by 20–40 per cent while simultaneously earning 10–30 per cent price premiums (and long-term contracts) for “green” aluminium, electrical steel, battery foil and solar-grade stainless which Chinese and Russian companies cannot easily match once the EU’s CBAM (2026) and similar carbon taxes kick in, he said.
However, without a stronger anti-dumping enforcement, imports continue to blunt any sustained price rally through 2026, making the green-tech pivot the only reliable way for metal companies to protect and even expand margins in an otherwise brutal commodity cycle, he said.
Ravi Singh, Chief Research Officer, Master Capital Services said in energy-intensive industries (such as aluminium smelting and steel production), energy represents 25-40 per cent of total production costs, which makes renewable energy more attractive.
For instance, switching from coal to solar energy via Open Access results in 8-10 per cent lower production costs for several steel manufacturers, he said.
Though the cost of transitioning from fossil fuels to renewable energy may come with high capex, he said, adding that the return on investment in renewable energy technology will exceed its costs.
Prashanth KP Kota, CFA Sector Lead – Basic Materials, Choice Institutional Equities said despite being structurally capital-intensive and often capital-constrained, metals and mining companies are allocating incremental resources toward green power.
The industry also faces pricing headwinds from imports as even a modest import volumes tend to depress domestic prices, reinforcing the sector’s inherently challenged return-on-capital profile, he added.
Published on November 27, 2025
