India’s top companies are lagging in achieving their renewable energy and decarbonization targets.
These include cement, steel, aluminium, textiles, and fertilizers, says a Climate analyst firm Climate Risk Horizons (CRH) report.
According to the analysis, Indian corporates are slow to transition to renewable energy. Only 5% of their annual electricity consumption comes from renewable sources.
CRH’s report, Slow to Switch, evaluates 33 companies across seven industries, including five large energy consumers, using publicly available data from their annual and sustainability reports.
Sectoral analysis:
The analysis finds that most corporates are not on track to achieve their decarbonization goals. While the information technology industry emerges as the overall top performer, the fertilizer sector lags behind with the poorest score.
• Steel companies such as JSW, Jindal, Tata Steel and ArcelorMittal/Nippon Steel are currently meeting a tiny fraction (less than 0.05% on average) of their energy from renewable sources.
• Textile companies such as Trident, Welspun, Arvind and Shahi have set targets in line with the Paris Agreement. But, on average, less than 3% of their energy consumption comes from renewable electricity.
• Cement companies like Ultratech, ACC and Ambuja have set targets to reduce emissions as per the Paris Agreement, yet the share of renewable energy in their overall energy consumption was only 2.5%.
• In the FMCG sector, Godrej, ITC and Britannia stand out for their low RE utilization, in contrast to Nestle and Hindustan Unilever, which fare the best in terms of translating renewable energy commitments into actions.
• The report highlights the significant potential of the heavy industry sector to drive decarbonisation in the Indian electricity system. The companies analyzed have an annual electricity consumption of over 169 BU (Billion Units), which is more than double the electricity consumption of Andhra Pradesh or West Bengal.
Authors note:
“Shifting to renewable energy is essential for energy security at the company level and for the Indian economy as a whole. While a few large companies have started to take steps in this direction, a lot more needs to be done, and a lot quicker, if India is to meet its decarbonization targets,” said Vishnu Teja, Energy Researcher and Lead Author of the report.
“India Inc needs to step up and start investing for an energy secure future. The country’s RE and decarbonization targets will not be met without active support from large corporate players. With green energy open access regulations now in place, companies should be signing Power Purchase Agreements to ensure that 100% of their electricity comes from renewable energy by 2030,” said Ashish Fernandes, CEO, CRH and co-Author of the report.