The Institute for Energy Economics and Financial Analysis (IEEFA) warns that India's drive to expand domestic coking coal production could inadvertently lead to a significant increase in methane emissions, a potent greenhouse gas, unless strict mitigation strategies are implemented during mine planning.
KEY NUMBERS
- 234.7 Kilotonnes: Methane generated by India's coking coal mining sector in 2025.
- 81% Emissions Concentration: Accounted for by just seven out of 30 tracked operating mines, mostly in Jharkhand.
- 5.1 kg/tonne: The methane intensity of coking coal in India, compared to 3.4 kg/tonne for steam coal.
- 87% Mitigation Potential: The proportion of abatable emissions that can be controlled for under $20 per tonne of CO2 equivalent.
- 50% Higher: The differential in methane intensity of coking coal versus steam coal.
MARKET ANALYSIS
The recent report published by the Institute of Energy Economics and Financial Analysis (IEEFA) highlights a critical environmental oversight in India's ambitious "Mission Coking Coal." As the nation strives for self-reliance in steel production, the push to extract coking coal from deeper, underground reserves brings a hidden environmental cost: a sharp rise in methane emissions. Methane is a potent greenhouse gas, with a warming potential significantly higher than carbon dioxide over a 20-year period.
The data reveals a stark reality. According to the IEA Global Methane Tracker 2026, the methane intensity of coking coal in India is inherently high—at 5.1 kg of CH4 per tonne of coal, which is roughly 50% higher than the 3.4 kg per tonne recorded for steam coal. This is a structural issue related to the depth and gas-rich nature of the reserves being targeted. In 2025 alone, the sector generated an estimated 234.7 kilotonnes of methane.
However, the IEEFA analysis presents a highly actionable solution. A striking finding is the extreme concentration of these emissions. Out of 30 operating mines tracked in the study, a mere seven mines—predominantly located in the eastern state of Jharkhand—are responsible for a staggering 81% of the sector's total methane emissions (amounting to 138.3 kilotonnes per year). This hyper-concentration means that targeted interventions at these specific sites could yield massive, cost-effective environmental benefits.
Furthermore, the economics of mitigation are surprisingly favorable. The report indicates that approximately 87% of India's abatable coking coal mine methane emissions can be addressed for less than $20 per tonne of CO2 equivalent. This places methane abatement in the lowest cost tier of global decarbonization efforts, especially when compared to the much higher costs associated with other industrial emission reduction strategies.
WHAT IT MEANS FOR THE STEEL INDUSTRY
The steel industry, a major consumer of coking coal, faces a dual challenge and opportunity. The IEEFA report stresses that while cleaning up mining operations is essential, India must concurrently prioritize reducing the absolute demand for coking coal in steelmaking.
This transition necessitates a strategic pivot towards greener technologies. The industry is encouraged to accelerate the adoption of Electric Arc Furnaces (EAF), significantly increase scrap utilization, and invest heavily in green hydrogen technologies. India's current EAF share remains below the global average, highlighting a clear area for growth and investment.
Moreover, the captured coal mine methane (CMM) and coal bed methane (CBM) shouldn't just be vented or flared; they can be utilized within the steel value chain itself, either for power generation or other industrial processes, further aiding in the sector's decarbonization targets and potentially offsetting energy costs.
MARKET OUTLOOK
Looking ahead, the trajectory of India's coal mine methane emissions depends heavily on policy action. Without immediate integration of abatement technologies—such as pre-drainage drilling and ventilation air methane (VAM) oxidation—projections indicate that total coal-mine methane output could more than double by 2029 compared to 2019 levels.
The path forward requires a balanced approach that supports industrial growth while meeting climate obligations. Embedding methane management into the core of mine planning, rather than treating it merely as a safety afterthought, is imperative. By leveraging existing, cost-effective technologies, setting operational benchmarks, and embracing greener steelmaking processes, India can successfully expand its domestic production capabilities while mitigating a major climate risk.