For all of the roadmaps, pledges, and targets they’ve drawn as much as obtain net-zero emissions sooner or later, India’s main companies carry out poorly with regards to a comparatively low hanging fruit within the decarbonisation journey: sourcing their electrical energy from renewable, and never fossil, sources.
An evaluation of the electrical energy consumption from main companies within the cement, metal, aluminium, textiles and fertilisers sectors discovered that out of 169 billion items of electrical energy consumed, solely eight billion items – round 6 per cent – got here from renewable sources.
The character of heavy business makes it a excessive client of power, which is used to generate warmth for industrial processes. However a big share of this power consumption is for electrical energy use, which may come from renewable sources as an alternative, the authors of the evaluation stated.
The information was put collectively by assume tank Local weather Threat Horizons (CRH) from public disclosures made by corporations together with Jindal Metal, Ultratech Cement, HINDALCO and 30 others, a number of of whom have introduced net-zero targets.
“It’s handy for corporations to say they’re not capable of make the swap due to technological challenges in industrial processes, however we’re speaking concerning the share of electrical energy that may extra simply be modified,” stated Ashish Fernandes, founding father of assume tank Local weather Threat Horizons and co-author of the research.
India’s high-emitting, hard-to-abate sectors are chargeable for 21 per cent of India’s emissions. The event of huge and steady renewable power sources for industrial processing continues to be underway, however present pointers and requirements, such because the Science Primarily based Targets Initiative, can assist companies benchmark their progress as they decarbonise.
Despite the fact that electrification from renewable sources presents a chance to decarbonise, most corporations are faltering with regards to setting sturdy targets, the CRH evaluation exhibits.
Arupendra Nath Mullick, vice chairman of the Council for Enterprise Sustainability at The Power and Assets Institute (TERI), says heavy industries are cognisant of the necessity to improve their share of renewable power, and that the dimensions of this demand must be supported by electrical energy distribution corporations.
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It’s handy for corporations to say they’re not capable of make the swap due to technological challenges in industrial processes, however we’re speaking concerning the share of electrical energy that may extra simply be modified.
Ashish Fernandes, founder, Local weather Threat Horizons
“State-owned discoms (distribution corporations) have to make use of instruments that may assist them predict what the demand for renewable power from heavy and client industries shall be, and procure it accordingly. However this isn’t being extensively used but,” he stated.
Rating industries
Of the 5 hard-to-abate industries included within the evaluation, corporations within the fertiliser sector carried out the worst, sourcing lower than 0.5 per cent of the sector’s power wants from renewable sources. The businesses included Coromandel, Nationwide Fertilisers, Chambal Fertilisers, Rashtriya Chemical substances and Fertilisers, and Gujarat State Fertilisers & Chemical substances Restricted.
The most effective performing business – cement – sourced simply 2.5 per cent of its power wants from renewable power. The cement business evaluation included Shree Cement, Ambuja Cement, Dalmia Cement, Ultratech Cement, and ACC Cement.
Every firm’s power consumption was rated throughout 4 broad standards: reporting and transparency in its annual report, sources of renewable power, demonstrating intent to decarbonise with renewable power targets, and present practices vis-a-vis share of renewables in power and electrical energy consumption.
Shahi Textiles, one among India’s largest attire manufacturing corporations, carried out greatest amongst all of the heavy business corporations, as a result of 70 per cent of its total electrical energy consumption is from renewable power. It additionally set a goal for 100 per cent renewable power for its electrical energy consumption and had their targets aligned with the Science Primarily based Targets Initiative (SBTI).
The report additionally contrasts the decarbonisation efforts of heavy industries with two much less power intensive sectors – Quick Transferring Shopper Items (FMCG) and Info Know-how (IT) – “as a result of they contribute considerably to the Indian financial system and are comparatively simpler to transition to renewable power,” it says.
The businesses thought of within the former embrace Britannia, Godrej, ITC Restricted, Nestle, and Hindustan Unilever Restricted. The IT sector included HCL Tech, Tech Mahindra, WIPRO, Infosys, and Tata Consultancy Providers.
Regardless of being decrease shoppers of electrical energy, a lot of FMCG’s 83 per cent share in renewable power reportedly got here from biofuels/biomass, whereas the IT sector’s share was round 45 per cent.
“These industries seem to outperform heavy business with regards to utilisation of renewable power. Nonetheless, that is deceptive given the relative ease by which they will swap to 100 per cent RE,” the report says. It additionally notes that biofuels and biomass will not be renewable sources at an industrial scale.
Apart from Jindal Metal, no different heavy business firm was piloting a decarbonisation programme, the CRH evaluation famous. Jindal Metal is presently experimenting with inexperienced hydrogen, utilizing it to exchange ammonia in its steel-making plant.
Electrifying industries
Among the many challenges heavy and client industries face in switching to renewable sources is the requirement of excessive temperatures, and reliance on fossil sources as feedstock. They’re additionally challenged by the lengthy lifetimes of their property, and the excessive tariffs that may include electrifying commercially obtainable processes.
Nonetheless, renewable-based electrification has the potential to keep away from roughly 180 million tonnes (Mt) of CO2 emissions by 2030, leading to a 17 per cent discount within the projected 2030 CO2 emissions from these industries, based on Ember Local weather, one other assume tank.
“Many of the achievable decarbonisation in Indian industries throughout the 2020s will come from greening their electrical energy provide. This is not going to solely deliver the potential emission reductions but in addition present broader advantages to the industries and the renewable power sources (RES) ecosystem,” Ember’s report says.
In the mean time, most corporations assessed within the CRH report are procuring renewable power at shares which can be decrease than the Renewable Buy Obligation (RPO) of 24.61 per cent. “The state regulatory commissions, generally, will not be both occupied with pursuing this (RPO) goal or should not have the flexibility to truly pursue it. That’s why it’s dropping by the wayside,” stated Fernandes.
Renewable power energy buy agreements (PPA) “ought to be the first supply of company decarbonisation,” the CRH report says, because the new Inexperienced Power Open Entry Rules give industries the choice to buy energy straight from mills, as an alternative of conventional distribution corporations.
“Industries have the choice to have captive RE vegetation or to go along with open entry provide from the RE tasks. Sourcing renewable power from open-access sources is preferable as a result of there’s a transparent account of the variety of renewable items used. We’re seeing that in states like Gujarat and Karnataka, this route is rising,” stated Mullick.
This story was revealed with permission from Mongabay.com.
