Climate change today is one of the biggest concerns for humanity. The impacts of industrialisation and global warming have played a definitive role in the evolution of how businesses are done. In India, one of the foremost industrial groups to make strong commitments towards climate protection is the Mahindra Group. Spearheading the movement for the Mahindra Group is its Igatpuri facility, which recently declared its carbon neutral status without the purchase of carbon credits.
As per the Paris Agreement, nations collectively need to address concerns over rising global temperatures and work towards limiting it to well below 2 °C above pre-industrial levels and pursuing efforts to limit temperature increase to 1.5 °C above pre-industrial levels. The Paris Agreement recognises that in doing so, risks and impacts of climate change would be reduced significantly.
Working on the lines of the Paris Agreement, the IPCC (Intergovernmental Panel on Climate Change) prepared a special report in 2018 to highlight the impact of global warming of 1.5 °C above pre-industrial levels. The report indicated that human activities have brought about a rise in global temperatures by 1 °C above pre-industrial levels. It also suggests that global warming is likely to reach 1.5 °C between 2030 and 2052. According to the IPCC special report, warming from anthropogenic emissions will last for a century to millennia, causing long-term changes such as rise in ocean levels, drought in some regions, extreme heat in some and heavy precipitation in several regions.
Giving due importance to the issue, many companies have started to change the way they think and operate. The Climate Group, a non-profit organisation has been working in this area to facilitate and accelerate climate action with many companies. According to its reports, around 49 bn tonne of CO2 is released into the atmosphere every year, of which industry (32 %), buildings (18 %) and energy sectors (11 %) were the major contributors. The Climate Group recently initiated the EP 100 programme wherein it brings together companies that are committed to using energy more efficiently, lower greenhouse gasses and accelerate a clean economy.
The Climate Group estimates that if 100 companies are able to double their energy productivity by 2030, more than 170 mn metric tonne of emission could be avoided cumulatively. This would equal removing 37 mn cars on the roads for a year. Further, the Climate Group has also projected that economies contributing to global emissions will need to achieve net-zero by 2050 to keep global warming under 2 °C. The Mahindra Group became the first company globally to sign up for the EP 100 programme.
OUTLOOK AT THE MAHINDRA GROUP
The Mahindra Group has always been cautious about cost and implications of non-judicious use of resources. But ever since 2016, the group has realised the importance of focussing on optimising resource management. With the climate change threat looming large, it was Anand Mahindra, Chairman, Mahindra Group, who committed his entire group of companies toward turning carbon neutral by 2040 at the Global Climate Action Summit held in September 2018. Spearheading the movement for the Mahindra Group was its Igatpuri facility that recently declared its carbon neutral status without the purchase of carbon credits.
INITIATIVES AT IGATPURI
Mahindra’s Igatpuri facility is the first in India to achieve carbon neutral status, verified by Bureau Veritas (India) Pvt Ltd. The facility, which was established in 1982, occupies a total area of 400,000 sq mt. The company achieved carbon neutrality at its facility by primarily focussing on more energy efficiency, leveraging renewable sources of energy as well as plantation of trees to absorb residual carbon. Mahindra also became the first company globally to commit towards doubling its energy productivity by 2030.
Auto Tech Review recently visited the company’s Igatpuri facility and caught up with Vijay Kalra, ED & CEO, Mahindra Vehicle Manufacturers Ltd (MVML) & Chief of Manufacturing Operations – Automotive Sector, Mahindra & Mahindra to understand more about its green initiatives.
Inside the Mahindra Group, operations were always outlined with a view on judicious use of energy and its cost benefits. Over the last two to three years, the company has undertaken various initiatives with a renewed focus across its 17 manufacturing locations. Energy conservation work has been taking precedence at these locations for the last 10 years. Mahindra has developed a ‘Promise Cycle’ method, wherein it decides business goals for three years. In 2016, the company decided that it will bring down the carbon and water footprint of its manufacturing units by 25 %. The company has been able to achieve this to a great extent, said Kalra.
As far as manufacturing processes and operations are concerned, approximately 70 % represents energy cost. In order to stay viable, the company has been looking at a three pronged approach – energy security, energy cost and climate impact. The Mahindra Group was also the first company in India to report its carbon price, set at $ 10/ tonne of carbon emitted. These funds will further help the company develop more carbon neutral initiatives.
The company launched a pilot project at its Igatpuri facility to begin the usage of LED lighting solutions. On realising investment costs within a couple of years of applications, the company has now installed LED lighting solutions across its facilities. To be precise, the company has installed 1.6 lakh LED light units across its facilities with a total project cost of Rs 16 cr. Mahindra has estimated that the energy saving in return is 200 lakh kWh/annum. With the installation of LED lighting across its facilities, the company has also reduced CO2 emissions to the tune of 16,400 tonne/annum.
The company has also optimised energy utilisation using more modern motors. These motors are spread across facilities used in the paint shop, water pump and HVAC. The old motors that were used were not efficient and consumed a lot more energy than before. These motors would also heat up fast, leading to excess energy consumption and increasing ambient temperature inside the facility, which in turn, added load on the cooling infrastructure. The company has identified around 1,100 motors, which it plans to change across its facilities through EESL. As of today, Mahindra has replaced around 119 motors with a power capacity of 1.1 kW to 22 kW. The IE3 motor has been installed in selected applications in M&M, which has led to a 6-10 % improvement in energy efficiency.
Like motors, latest air-conditioning units will also improve cost efficiency for M&M. The company has lined-up plans to use energy-efficient inverter-based ACs. At Igatpuri, the company was using old air-conditioning units with a three star energy efficiency rating. These units consumed on an average 30.1 kWh/day. In contrast, the new Inverter ACs will have an energy consumption of around 20.5 kWh/day, resulting in energy savings of around 24 %.
At its Farm Equipment and Automotive divisions at Kandivali, the company has been able to incur savings up to 32 % and 45 % respectively through implementations of these inverter ACs. The expected payback through this will come in 19 months for the Automotive Division at Kandivali, 18 months for the Farm equipment Division (FD) at Kandivali and 25 months for their Automotive Division at Igatpuri. In phase one (FY 18-19), the company plans to install 512 inverter AC units with a total investment of Rs 3 cr and is in final stages of an agreement with EESL for procurement of these ACs.
Phase two will see the company install 618 inverter AC units with an estimated investment of Rs 3.21 cr; the budget for which will be passed in H1 FY-19. This initiative will incur an investment of around Rs 6.2 cr and result in an estimated annual savings of Rs 3.5 cr. The implication for the environment stands at an estimated annual CO2 mitigation of 3,608 tonne.
ENERGY CONSERVATION FOCUS
While the aforementioned mainstream initiatives will help M&M conserve energy and keep a tight rein on costs in the long run, the company has made strides in multiple avenues to conserve energy and bolster its eco initiatives. A case study can also be made from the methods used by the company to offset added cost by using the by-products of its present mechanisms to facilitate ancillary operations. Examples of these include a heat compression (HOC) dryer that operates on waste heat, heat recovery operations from AC units and furnaces. M&M has also used applications such as inverter welding machines, elimination of idle running of machines and energy efficient chillers.
Apart from just conserving energy, the company also laid the foundation for use of more efficient, clean and renewable sources of energy. This includes solar panels installed for power generation across its facilities. The total output from these is 6 MWp, with the largest output coming from its automotive and farm equipment divisions in Zahirabad – with a total output of 1150 KWp and 1 MWp from the respective facilities. These solar power initiatives have resulted in a total CO2 reduction of 5,788 tonne/annum. With the use of solar generated power, the company has been able to garner a total annual savings of Rs 5.6 cr.
Along with solar energy, the company has also explored the wind energy option. The Mahindra Group began its first project in this arena on May 1, 2017. The renewable wind power comes from windmills with an installed capacity of 4.2 MW for the automotive division. From May 1, 2018, the company also began power generation for its farm equipment division with windmills rated for 2.1 MW of power. The total energy generation potential from these initiatives stands at 120 lakh kWh and also accounts for a reduction of 10,332 tonne of CO2 per annum. The implementation of windmills has helped the company with expected annual savings of Rs 11.3 cr.
The Mahindra Group has also placed high focus on creating carbon sinks, for which it has more than 10 years of experience. The company has over 30,000 plantations with 222 varieties of trees. At its Igatpuri facility, the company has also reduced usage of paper by 67 % over the last two years and reduced diesel consumption for inbound and outbound logistics by 30 % in the last two years. In FY17, the company’s Igatpuri facility attained ‘zero waste to landfill’ status and also became a water positive plant. Five plants of the Mahindra Group, including Igatpuri, have been certified as ‘zero waste to landfill’ facilities. With these various initiatives, the Mahindra Group appears to be on track to achieve its commitment of turning carbon neutral by 2040.
TEXT & PHOTO: Joshua David Luther