Environmental Technologies Industries
||Environmental Technologies Industries
|India Environmental Export Market Plan|
|Chapter 7 - Air Pollution Control Market|
The Indian market for air pollution control and management is estimated at $408 million.
The deteriorating ambient air quality in urban centers and industrial estates has become a serious concern for government, industry, and the public in India. The public is also becoming increasingly aware of health risks associated with poor air quality. The projected suspended particulate matter emissions from industrial and thermal power plants in India 2000 are estimated to be 20 million tons and 60 million tons per year, respectively. These emissions, combined with vehicular emissions, have caused considerable deterioration of urban air quality.
The Central and State Pollution Control Boards (CPCBs and SPCBs) have established a comprehensive network of air quality monitoring stations under the National Ambient Air Quality Monitoring Program (NAAQM). Under this program, 290 stations were established in 92 cities throughout the country. Almost all cities in the states of West Bengal, Gujarat, Madhya Pradesh, Bihar, Rajasthan and the union territory of Pondicherry were reported to have reached critical levels of air pollution in terms of suspended particulate matter. The critical level implies average annual suspended particulate matter concentration levels at 1.5 times higher than the prescribed national ambient air quality standard (i.e., 140 micrograms per cubic meter for residential areas). In Delhi and Calcutta, the annual average of suspended particulate matter is in the range of 327 to 382 micrograms per cubic meter, which is two to three times higher than the standards. In Mumbai and Chennai, the annual average of suspended particulate matter exceeds the prescribed national standards but is not as high as in Delhi or Calcutta.
While the annual average levels of sulfur dioxide and nitrogen oxides fall well below the prescribed national standards at most locations in the cities, the upward direction of the trend is becoming a cause of concern. Tables 7.1 and 7.2 present the top 10 locations with respect to suspended particulate matter and sulfur dioxide in the country.
Table 7.1 - Cities with Highest Concentrations of Industrial and Residential Suspended Particulate Matter (SPM), Based on Annual Averages
1. Two different locations in the same town
Annual Average SPM (microgram/Nm3)
(Prescribed Standard: 360 micrograms per square meter)
|Kanpur, Uttar Pradesh||530|
|Calcutta, West Bengal||514|
|Mandi Gobindgarh, Punjab||425|
|Gajraula, Uttar Pradesh||419|
(Prescribed Standard: 140 micrograms per square meter)
|Kanpur, Uttar Pradesh||504|
|Lucknow, Uttar Pradesh||455|
|Bhopal, Madhya Pradesh||434|
|Gajraula, Uttar Pradesh||402|
|Indore, Madhya Pradesh||372|
Source: Central Pollution Control Board, 1997–1998.
Transportation and manufacturing are the two major sectors contributing to the deterioration in ambient air quality in metropolitan cities. The transportation sector accounts for 52 percent to 67 percent of the deterioration, while the industrial sector accounts for 25 percent to 46 percent. The remainder is from domestic activities. On the industrial front, coal-based thermal power plants are the second largest contributor after the transportation sector.
Fast deterioration of ambient air quality in cities and in industrial locations has made air pollution control a
key environmental concern. There has been an intensification of pressure on industry (in particular the automobile
sector) to adopt emission control/reduction measures.
The air pollution control equipment segment of the environmental industry includes equipment for use in reducing air emissions from stationary and mobile sources. This section focuses on stationary sources of air pollution and includes estimates of the market for mobile air pollution control systems, that is, catalytic converters. The air pollution control market is mainly driven by the Air Prevention and Control of Pollution Act, 1981, the Environment Protection Act, 1986, and the Motor Vehicle Act, 1980.
Table 7.2 - Locations With Sulfur Dioxide Concentrations Exceeding Prescribed Standards
* Two different locations in the same town
Annual Average (microgram/Nm3)
|Nagda ,* Madhya Pradesh||Industrial||74.3|
|Nagda,* Madhya Pradesh||Residential||66.3|
|Calcutta, West Bengal||Residential||29.6|
|Agra, Uttar Pradesh||Sensitive||17.4|
1. Industrial Standard: 80 microgram/m3
2. Residential Standard: 60 microgram/m3
Source: Central Pollution Control Board, Annual Report, 1997–1998.
The key requirements of this legislation and the institutional structures in place for their enforcement are presented in Table 7.3.
In the transportation sector, the government’s priorities are directed at promoting integrated solutions to India’s vehicular pollution problem. Reform measures have been aimed at producing improved fuel quality (gasoline as well as diesel), improved engine designs at the manufacturing stage, and improving legislative controls for strengthened enforcement and implementation.
In the industrial sector, growth of the air pollution control market has been directly linked to the growth of the power sector. India’s power production continues to be dominated by fossil fuel–based thermal power generation (approximately 71.94 percent of total capacity). The rapid growth of the power sector to meet rising energy demand is a clear indicator of promising business opportunities. Total planned new power plant capacity under India’s ninth Five Year Plan (1997–2002) is provided in Table 7.4.
Table 7.3 - Legislation Driving Opportunities in Air Pollution Control
Source: EQMS India Pvt., Ltd.
Key Requirements of Market Driving Legislation
|The Air Prevention and Control of Pollution Act, 1981; Consent to establish and consent to operate||Air pollution control equipment to meet prescribed emission standards. Air-pollution control consulting services including techno-economic feasibility studies.||Central Pollution Control Board|
State Pollution Control Board
Pollution Control Committees
|The Environment Protection Act, 1986; Compliance to prescribed standards for stationary sources||Air pollution control equipment to meet prescribed emission standards.||Ministry of Environment and Forests|
Central Pollution Control Board
State Pollution Control Boards
Pollution Control Committees
Ministry of Petroleum
|Fuel Quality Specifications for Emission-Related Parameters||Improvement in refining technologies.||Ministry of Environment and Forests|
|Motor Vehicle Act, 1980/Central Motor Vehicle Rules, 1991/1995/1997; Compliance with emission requirements||Improved engine design and manufacturing. Multiple fuel injection systems, catalytic converters||Ministry of Surface Transport|
State Transport Departments
Table 7.4 - Proposed Additions to Power Generation Capacity in India's Ninth Five-Year Plan (megawatts)
Source: Ministry of Power.
Stationary Source Air Pollution Control Market
The air pollution control equipment business has evolved among industries that depend mostly on energy intensity, particularly in the form of combustion. Coalbased utilities, followed by cement plants and the petroleum/refinery sector, represent about two-thirds of the market opportunities. The distribution of air pollution-intensive industries is shown in Table 7.5.
Suspended particulate matter from stationary sources constitutes the majority of the air pollution control market
in India. The technologies that are in demand for suspended particulate matter reduction include electrostatic
precipitators (60 percent), bag filters (20 percent), dust collection systems (15 percent), and wet scrubbers (5 percent).
In most cases, suspended particulate matter emissions from stationary sources are required to be less than
150 milligrams per cubic meter.
Table 7.5 - Air Polluting Industrial Sectors in India (Grouped by Potential to Generate Sales of Control Technologies)
Source: Mobile Air Pollution Control.
Indian coal has low sulfur content (in the range of 0.1 percent to 0.3 percent). Therefore, sulfur dioxide emissions
are generally regulated through “minimum stack height requirements.”
The issue of nitrogen oxide emissions from thermal power utilities recently has gained increased consideration. The Environment (Protection) Rules, 1998, prescribed limits for nitrogen oxide emissions for gas/naphtha-based thermal power plants and has contributed to expanding the demand for pollution control equipment.
One of the key regulatory trends in recent years has been to prescribe emission standards for suspended particulate matter and sulfur dioxide on a per-unit-of-production basis rather than on conventional concentration based regulatory limits. The sectors for which the production-based emission standards have been prescribed include aluminum, copper, lead, zinc smelters, nitric and sulfuric acid plants, fertilizer plants, glass, and the rayon industry.
The share of vehicular emissions is estimated to be more than 2.5 times that of industrial sources in cities. This is largely due to growth in the vehicle population, which, in turn, is due to improving socioeconomic conditions and a more favorable policy framework.
Of the current 40 million vehicles on Indian roads (1998), about 76 percent are two-wheelers, with a very high proportion of two-stroke engines. The introduction of Euro I and Euro II emission requirements scheduled to take effect from 2000 to 2005 has brought potential opportunities for foreign suppliers in the areas of cleaner/alternative fuels, multipoint fuel injection systems, exhaust analyzers/testing equipment, and catalytic converters for tailpipe emissions control. Taking into account New Delhi’s deteriorating air quality, the Supreme Court of India has advanced the implementation schedule of Euro I and Euro II with respect to the National Capital Region Delhi.
The demand for catalytic converters was expanded considerably by the recent government notification making catalytic converters mandatory for all four-wheeler gasoline-driven vehicles in 45 cities (see Table 7.6), effective from June 1998. In 1995, the catalytic converter requirement was made mandatory in all four-wheeler gasoline-powered vehicles in New Delhi, Mumbai, Kolkata, and Chennai. The 45 cities and their territories are listed in Table 7.6.
Estimated Market Size and Growth Prospects
The air pollution control section (from stationary and mobile sources) constitutes about 9.4 percent of the Indian environmental market. The market size for air pollution control equipment was estimated at $140 million in 1997-1998. The performance reviews of air pollution control equipment providers’ sales receipts indicate an annual growth rate of about 10 percent in 1997-1998. The air pollution control equipment market is expected to grow at an average rate of 20 percent each year for the next three years. Growth will primarily be supported by the transportation sector (mainly because of the enforcement of the April 2000 emissions standards) and planned capacity additions in the power sector.
Table 7.6 - Indian Cities for Mandatory Provision of Catalytic Converters in Four-Wheeler Gasoline-Powered Vehicles on or after June 1, 1998
Source: Central Motor Vehicle Rules, Notification Number S.O. 138 (E), February 19, 1998.
|Andhra Pradesh||Hyderabad, Vishakhaptnam|
|Bihar||Patna, Jamshedpur, Ranchi|
|Gujarat||Gandhinagar, Surat, Baroda|
|Haryana||Gurgaon, Hissar, Ambala|
|Jammu and Kashmir||Jammu, Srinagar|
|Kerala||Trivandrum, Cochin, Calicut|
|Madhya Pradesh||Bhopal and Indore|
|Maharashtra||Pune and Nagpur|
|Punjab||Amritsar, Ludhiana, and Jalandhar|
|Rajasthan||Jaipur, Jodhpur, and Udaipur|
|Uttar Pradesh||Lucknow, Allahabad, and Kanpur|
|Andaman and Nicobar||Port Blair|
|Dadra and Nagar Haveli||Silvassa|
The mobile source air pollution equipment and services market is still in the early stages of development. It is set to grow rapidly, however, with the introduction of Euro I and II requirements and the mandatory requirement for catalytic converters in the cities in Table 7.6 and the four metro areas. Because compliance with European requirements and the provision of catalytic converters is applicable at the manufacturing stage, market growth is highly likely. Currently, most of the demand is met through imports. Several foreign firms are actively exploring collaborative ventures. In 1998-1999, three foreign collaboration proposals (from Germany, the Netherlands, and the United States) were approved by the Indian government for the production of catalytic converters. The foreign firms are Friedrich Boysen GmbH, Germany; Mathey Finance B.V., the Netherlands; and Engelhard Corporation, United States.
India’s air pollution control industry has developed capabilities for manufacturing a diverse range of equipment for dust collection in the stationary air pollution control sub-section. India’s expertise is limited, however, in the case of special gaseous pollutants. Table 7.7 shows the air pollution technology needs in key enduse sectors.
The number of new industry sectors for which emission standards were prescribed in 1996 and 1998 include beehive hard coke ovens, briquettes, soft coke, the cupola battery manufacturing industry, gas/naphtha-based thermal power plants, and rayon industries. All these industries are prospective end users of air pollution control equipment.
While strong capabilities exist at the domestic level, suspended particulate matter pollution control equipment offers opportunities for foreign firms specializing in more sophisticated and high performance electrostatic precipitators and bag filters.
Table 7.7 - Business Opportunities in Industrial Air Pollution
Source: EQMS India Pvt., Ltd.
|Thermal power stations and iron and steel plants||Energy-efficient equipment|
High-temperature filter bags
|Dyes and dye intermediates, small boilers (up to 15t/hour), electroplating||Package scrubber/High-efficiency cyclones|
|Thermal power stations, pharmaceuticals, and cement||NOx removal|
|Dyes and dye intermediates, chemicals||High-efficiency scrubbers|
|Petrochemicals, distilleries, pharmaceuticals, and metallurgical industries||Monitoring equipment; Odor control systems|
Fugitive emission control systems
|Petrochemical, pesticides, iron and steel, nitrogenous fertilizer, thermal power stations||Monitoring instruments|
|Fertilizers; iron and steel; sugar; pulp and paper; caustic soda; petroleum refining desulfurization of systems||Specialized air pollution treatment equipment; equipment for recovery units; smokeless flares, rapper recovery crude oil; sulfur|
The air pollution control industry in India has developed the capability to manufacture a diverse range of air pollution control equipment for control of suspended particulate matter. There are only a few leading domestic manufacturers of air pollution control systems. Otherwise, the market is dominated by joint ventures of Indian firms with foreign firms specializing in air pollution control. The number of successful foreign collaborations in the air pollution control sector is between 25 and 30. Estimated direct import market share is about 10 percent in the stationary air pollution control sub-sector because of the strong indigenous technological and manufacturing base in the private and public sectors. In the mobile air pollution control sub-sector, U.S. share is estimated at 15 percent, with the remainder coming from Japan and Korea. Many of these firms offer fuel-efficient and emission control technologies as a part of a comprehensive package.
Ozone Depleting Substances Phase-Out in India
In India, seven types of ozone depleting substances (Chlorofluorocarbon [CFC]-11, CFC-12, CFC-113, carbon tetrachloride, methyl chloroform [MCF], Halon-1211, and Halon-1301) are used for refrigeration and air conditioning, for aerosol, for foam manufacturing (rigid and flexible), for fire extinguishing, and as solvents. The total consumption of ozone depleting substances in India in 1991 and 1997 was 13,122 tons and 16,027 tons, respectively.
India is a signatory to the Montreal Protocol and developed its ozone depleting substances phase-out program in 1991. As a result, most of the large- and medium-size firms using ozone depleting substances have either phased it out or are in the process of phasing it out. The maximum ozone depleting substances phase-out has been achieved in the foam, aerosol, and halon sectors, followed by refrigeration and air conditioning. Although India has until 2010 for the ozone depleting substances phase-out, most of the industrial sectors have agreed with the Indian government to phase out ozone depleting substances by 2002. Accordingly, firms have already begun exploring alternative sources of supply and are developing ozone depleting substances phase-out projects. Because India is entitled to multilateral funding under the Montreal Protocol, proactive firms are obtaining assistance from multilateral agencies for the phase-out. As of December 1998, India had obtained project funds amounting to $51.6 million.
Because the ozone depleting substances phase out in India is at its end, ozone depleting substances reduction-related products and services might be a less attractive target market.
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