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Research: Solar panels on agricultural land are suitable for wildlife habitat – EQ Mag

Anand Gupta — Tue, 21 Feb 2023 05:10:38 +0000

Melbourne : Australia’s renewable energy transition has fuelled the construction of dozens of large-scale solar power projects (PLTS). Although this trend reduces the dependence of Kangaroo Country on fossil fuels, the construction of PLTS also increases the need for land to install solar panels.

The same trend has also occurred in Indonesia, which has begun to boost the construction of large-scale PLTS.

PLTS projects are mostly located in rural areas. A number of parties are concerned that land use for PLTS has the potential to erode agricultural production and disrupt wildlife habitats.

Actually there is a way to expand the PLTS infrastructure without disturbing humans or other creatures. For example, there is an agrivoltaic PLTS project that operates between agricultural crops or livestock.

So, how is the concept of convoltaic PLTS – a combination of efforts to conserve biodiversity with solar energy? My recent research examines whether PLTS can be used to support the conservation of native species in an area. As a result, I found solar panels to be a useful habitat for wildlife, as well as beneficial for soil fertility and farmers.

New house Our wild landscapes continue to diminish. In Australia, protected areas such as national parks cover only 9 per cent of the total area. Meanwhile, in Indonesia, the number of protected areas on land is only equivalent to 12.2 per cent of the total area.

Many of the trees in the farm area were cut down to become pasture for livestock. This means that wild animals that depend on trees have lost most of their habitat. For this reason, we must provide new places so that wild animals can find food, rest, shelter, and breed.

My research examines whether PLTS areas located on agricultural land or livestock can also be used as wildlife habitat. I conducted surveys and investigations using camera traps (hidden cameras) to identify plants and animals between solar panels. I also noted how long it took them to colonise, and what steps needed to be taken to support them.

My research results also try to come up with a new term for this dual land use: convoltaic. I also cite other studies that conclude the benefits of PLTS for conservation. Of course we still need further research on this matter.

The three-dimensional structure of the solar panels (and their supports) adds to the richness of the structure in a landscape of agricultural land. This power plant also functions as a place for animals to take shelter from predators, just like artificial reefs in lakes and oceans. Solar panels can also be a great place to house animals.

PLTS infrastructure also creates a mosaic of sunlight and shadows. This condition allows the area around the PLTS to become a micro habitat for plants and animals.

Studies conducted in Europe show that large-scale PLTS can increase the biodiversity and number of plants, grasses, butterflies, bees and birds. The vegetation that grows between the solar panels also serves as a route for animals to travel , a breeding ground, as well as shelter for wild animals. Good management is the key My study also recommends management strategies to optimize the benefits of solar panels for wildlife.

Land managers must provide a variety of flowering plant species to stimulate the arrival of pollinating insects (pollinators). The grass that grows between the solar panels should also not be trimmed frequently or too short.

Pollinating insects prefer tall vegetation for foraging. Also don’t be too high so as not to block the solar panels from absorbing sunlight.

If possible, reduce the use of herbicides or other chemicals. PLTS must also be connected to other vegetation areas, such as hedges or tree rows. The goal is for wildlife to move from the PLTS area to other habitats.

Land managers who combine PLTS with wildlife habitat can also take a number of advantages. They can reap income from obtaining environmental credits through carbon sequestration projects and increasing biodiversity. Landowners can also increase soil fertility by increasing the number of pollinating insects. They can also provide habitat for birds through nest boxes or perches to control insect populations.

Even so, we need more studies to understand the various potentials of this convoltaic PLTS. Step forward We already know the benefits of renewable energy in reducing greenhouse gas
emissions. Now, we need more research to see the benefits of PLTS to wildlife.

We also lack research on how to best place, configure and manage PLTS to boost biodiversity. Collaboration between industry, land managers and experts is needed so that clean energy production and conservation can go hand in hand.

Source: PTI

Research: Exploring ways to harness plant molecules for solar energy – EQ Mag

Anand Gupta — Mon, 20 Feb 2023 05:59:27 +0000

Washington [US] : The current solar panels aren’t very efficient as they are only able to convert up to about 20 per cent of the sun’s energy into electricity. As a result, to generate a lot of electricity, the panels require a lot of space–sometimes leading forests to be cut down or farms being replaced.

If solar panels were more efficient, much smaller panels could make the same amount of electricity, and wouldn’t claim as much land.

To make solar panels that are more efficient, Lahari Saha, in the lab of Professor Chris D. Geddes at the University of Maryland, Baltimore County, is working to make electricity in a unique way–by harnessing plants’ abilities to convert sunlight into chemical energy using biological molecules, like chlorophyll, that excel at absorbing sunlight. Saha will present her work on Wednesday, February 22 at the 67th Annual Biophysical Society Meeting in San Diego, California.

Their goal is to use biological molecules to make electricity that can then be harvested and used to power devices or stored in batteries for later use. The process involves leveraging molecules’ fluorescence. “Any sort of molecule that fluoresces, gives off light. If we excite the fluorophore, it can transfer its energy to metal nanoparticles, and if the particles are close enough to each other, they will knock off electrons and generate current,” Saha explained.

The process is not just limited to molecules that fluoresce, Saha explained, they just need to have a high absorption of light such as chlorophyll, beta carotene, or lutein. Each of these is relatively inexpensive and easy to derive from plants

The other benefit of this kind of fluorescence-based solar panel is that it would be easier to recycle. Currently, solar panels rely on expensive materials like silicon and contain elements that can be toxic, including lead and cadmium–in most states solar panels are considered hazardous waste when it’s time to dispose of them.

But Saha is hopeful that her solar panels will be primarily plant-based molecules and other materials that are relatively prevalent like copper, making them easier to recycle when the time comes. Plus, by selecting materials with greater longevity, she hopes the solar panel will last longer before it is time to dispose of them.

But Saha’s top goal is to make a solar panel that’s more efficient, “so it doesn’t have as large of a footprint,” she said. She hopes her smaller solar panels will allow farms to maximize food production over generating energy and will keep forests preserved.

Source: ANI

New PV Installations Worldwide Will Grow by More Than 50% YoY to 351GW for 2023 Thanks to Rising Demand, Says TrendForce – EQ Mag

Anand Gupta — Sat, 18 Feb 2023 05:17:26 +0000

TAIPEI, Taiwan : TrendForce’s latest research on the global market for solar PV reveals that some of the unmet demand that emerged during the 2021~2022 period has been carried over to 2023. In the past two years, the supply chain for PV products experienced pandemic-related disruptions, and prices of PV modules (solar panels) were high due to a supply crunch for polysilicon. These factors led to delays in installations of PV systems. Moving into this year, prices have fallen back to their usual ranges across the supply chain due to a significant growth in the overall production capacity for polysilicon. Therefore, the global PV demand is expected to expand significantly.

TrendForce currently projects that new PV installations worldwide will total 351GW and show a YoY growth rate of 53.4% for 2023. However, there are potential factors that could negatively affect the market. For instance, there are still concerns about the global economy exhibiting a serious slowdown. Additionally, high inflation remains a challenge for many countries. Hence, the release of installation demand may not proceed as smoothly as anticipated if governments are unable to provide the necessary financial resources to support their policies for promoting renewable energy.

According to TrendForce’s analysis, the Asia-Pacific region has largest amount of installation demand in 2023. It is followed by Europe, the Americas, and the combined regions of the Middle East and Africa. New PV installations in the Asia-Pacific region are currently projected to reach 202.5GW for 2023, reflecting a YoY growth rate of 55.4%. Countries in the Asia-Pacific region that are projected to post a high growth rate of more than 40% include China, Malaysia, and the Philippines. In these markets, government policies are the primary accelerant for installation growth. Turning to the more mature markets such as Japan, Australia, and South Korea, they will be seeing a more stable level of installation demand during 2023.

With regard to Europe, new PV installations in the region are projected to increase by 39.7% YoY to around 68.6GW for 2023. Germany, Spain, and the Netherlands are the main demand contributors. To address the problem of persistently high electricity prices, governments of many European countries have provided subsidies and tax credits to promote the deployment of PV systems. These incentives, together with falling prices for PV modules, will be driving installation growth across the region this year, especially in relation to residential PV projects. Furthermore, the EU has loosened the regulations concerning permits and applications for setting up PV projects. The lowering of the regulatory barriers will also synergize with the decline in module prices, thereby encouraging the development of large-scale projects. TrendForce believes the installation demand related to the construction of ground-mounted PV power stations in Europe will return to positive growth during the 2023~2024 period.

Looking at the Americas as a whole, new PV installations are projected to total around 64.6GW for 2023. This figure translates to a YoY growth rate of 65.2%. In the Americas, PV demand has been highly concentrated in a few countries such as the US, Brazil, and Chile. However, Colombia and Canada will witness a surge in grid connections of new PV projects this year. Regarding the US market, it was previously affected by the Uyghur Forced Labor Prevention Act and the anti-circumvention investigation on several Southeast Asian countries. And there was a slowdown in new installations related to ground-mounted PV power stations since this kind of project is highly sensitive to cost fluctuations. However, the US market will again exhibit strong growth in 2023 because the Inflation Reduction Act has helped increase the number of projects in the pipeline. There is a possibility of a doubling of the installation demand from the US in 2023. Turning to Brazil, the government there continues to promote distributed PV projects. These include rooftop PV projects for residential, commercial, and industrial settings. As for centralized PV projects such as ground-mounted PV power stations, the related installation demand could grow at a much faster pace if the country’s regulatory regime undergo further liberalization.

Lastly, with regard to the Middle East and Africa, these regions are showing steady growth. The two regions together will add 14.9GW of new PV installations in 2023, thereby posting a YoY growth rate of around 49.5%. TrendForce points out that the installation growth of Mideast and African countries is highly dependent on renewable energy tenders, and projects involving large ground-mounted PV power stations account for much of the demand from these markets. The major growth contributors in the two regions are the UAE, Saudi Arabia, South Africa, and Israel. Presently, tendered projects that are either to be built or being built in the two regions come to a total of more than 9GW. TrendForce also notes that Mideast and African countries have an abundance of solar resources and offer strong policy incentives for the development renewable energy. Thus, the potential for growth is huge. TrendForce expects the two regions to provide more and more solar tenders in the future.

About TrendForce

TrendForce is a global provider of the latest development, insight, and analysis of the technology industry. Having served businesses for over a decade, the company has built up a strong membership base of 500,000 subscribers. TrendForce has established a reputation as an organization that offers insightful and accurate analysis of the technology industry through five major research departments: Semiconductor Research, Display Research, Optoelectronics Research, Green Energy Research, and ICT Applications Research. Founded in Taipei, Taiwan in 2000, TrendForce has extended its presence in China since 2004 with offices in Shenzhen and Beijing.

India’s green bonds show policy focus on climate mitigation: Fitch Ratings – EQ Mag

Anand Gupta — Sat, 11 Feb 2023 05:24:10 +0000

The sovereign green bonds issued by India reflects the growing policy focus to scale up domestic financing capacity on climate mitigation and adaptation, said credit rating agency Fitch Ratings.

“We expect the bonds to be held largely by domestic investors, incentivised by the national climate policy to mobilize financing resources for green activities,” Fitch Ratings added.

The first issuance in January 2023 comprised two tranches, with five-and 10-year maturities, totalling Rs 80 billion (USD one billion). A second offering, also comprising two tranches with five- and 10-year maturities raised an additional Rs 80 billion on February 9.

Proceeds from the sovereign green bonds will go towards projects that meet India’s decarbonisation targets, which include achieving net-zero emissions by 2070, reducing emissions intensity of gross domestic product (GDP) by 45 per cent by 2030 over 2005 levels, and increasing the share of non-fossil fuel energy resources to 40 per cent by 2030, the credit rating agency added.

The Indian government published its Sovereign Green Bond Framework in October 2022, aligning itself with the International Capital Market Association’s Green Bond Principles. The framework identifies how the proceeds from green bonds will be allocated to projects such as renewable energy, energy efficiency, clean transportation, sustainable water and waste management, and green buildings.

The outstanding amount of GSSS1 (Green Social, Sustainability and Sustainability linked) bonds issued by Indian entities stood at $19.17 billion by December 2022, making up roughly 3.8 per cent of the overall outstanding corporate bonds in India. In terms of issuance, green bonds accounted for the majority of labelled bonds issued in India, accounting for a total of $20 billion by January 2023, said Fitch Rating.

Indian green bond issuers are heavily concentrated in the energy sector, dominated by large energy companies using the proceeds to build renewable energy projects, particularly solar.

Source: PTI

Moody’s turn ‘moody’ on 4 Adani Group companies – EQ Mag

Anand Gupta — Sat, 11 Feb 2023 05:10:40 +0000

The credit rating agency changed its outlook to ‘negative’ from ‘stable’ in the case of four Adani Group companies

CHENNAI: Affirming its ratings on eight companies of the Adani Group, global credit rating agency Moody’s Investors Service maintained its outlook on four companies as ‘stable’.

The credit rating agency changed its outlook to ‘negative’ from ‘stable’ in the case of four Adani Group companies.

According to Moody’s, the eight companies are: A

Adani Ports and Special Economic Zone Limited (APSEZ) – Baa3 ratings affirmed; outlook remains stable

Adani International Container Terminal Private Ltd (AICTPL) – Baa3 ratings affirmed; outlook remains stable

Adani Green Energy Restricted Group (AGEL RG-2) comprising Wardha Solar (Maharashtra) Private Limited, Kodangal Solar Parks Private Limited and Adani Renewable Energy (Rj) Limited – Ba1 ratings affirmed; outlook remains stable

Adani Transmission Restricted Group 1 (ATL RG1) comprising Barmer Power Transmission Service Limited; Raipur-Rajnandgaon-Warora Transmission Ltd; Sipat Transmission Limited; Thar Power Transmission Service Limited; Hadoti Power Transmission Service Limited; ChhattisgarhWR Transmission Limited – Baa3 ratings affirmed; outlook remains stable

Adani Green Energy Limited (AGEL) – Ba3 ratings affirmed; outlook changed to negative from stable.

Adani Green Energy Restricted Group (AGEL RG-1) comprising Adani Green Energy (UP) Limited; Parampujya Solar Energy Private Limited; Prayatna Developers Private Limited – Ba2 ratings affirmed; outlook changed to negative from stable

Adani Transmission Step-One Limited (ATSOL) – Baa3 ratings affirmed; outlook changed to negative from stable

Adani Electricity Mumbai Limited (AEML) – Baa3 ratings affirmed; outlook changed to negative from stable

These rating actions follow the significant and rapid decline in the market equity values of the Adani Group companies following the recent release of a report from a short-seller highlighting governance concerns in the Group.

Source: PTI

India Ratings Reassigns and Downgrades Talettutayi Solar Projects One’s Term Loan to ‘IND A-’; Outlook Negative – EQ Mag

Anand Gupta — Thu, 02 Feb 2023 05:35:53 +0000

India Ratings and Research (Ind-Ra) has taken the following rating actions on Talettutayi Solar Projects One Private Limited’s (TT1) bank facilities:

#In line with the Reserve Bank of India’s guidance note to credit rating agencies dated 22 April 2022 for bank loan- credit enhanced ratings, Ind-Ra has not assigned credit enhanced ratings to the bank loans availed by TT1 under the obligor-co-obligor structure. The unsupported rating is no longer required to be disclosed.

*INR1,639.1 million outstanding as on 30 November 2022

Analytical Approach: Ind-Ra had previously adopted a residual cash flow approach for rating the debt facilities of TT1 and Talettutayi Solar Projects Two Private Limited (TT2), under the obligor and co-obligor structure. However, owing to the guidance note and the stipulations thereof by the Reserve Bank of India related to credit enhancement (CE) ratings to bank loan ratings under obligor co-obligor structures, Ind-Ra has revised its approach while rating the bank loan facilities of obligor co-obligor structures. The rating has been reassigned owing to a change in the approach and the CE suffix has been removed. Furthermore, Ind-Ra has factored in the cross-guarantee document executed subsequently in January 2023 between TT1 and TT2 in line with the Reserve Bank of India circular. As per the revised approach, Ind-Ra has arrived at the final rating of the debt instrument factoring in the consolidated credit profile of TT1 and TT2 considering the strong legal linkages on account of presence of a cross guarantees between the two SPVs. The debt of TT2 is rated at ‘IND A-’/Negative. The downgrade reflects a sustained underperformance in TT2’s plant load factor (PLF).

The financing document also specifies a cross-default between TT1 and TT2, along with the support mechanism defined in the trust & retention account (TRA) agreement. In the event of an insufficiency of funds/a shortfall in debt servicing by any of these entities, the lenders can utilise the cash in the surplus account of the other entity to set-off such shortfall. The extent of the support will depend on the surplus funds available with the entity after meeting its own debt obligations and in accordance with the priority of cash flow waterfall structures as per the TRA.

The projects have compulsorily convertible debentures of INR330 million and INR66.2 million in TT1 and TT2, respectively. TT2 also has some unsecured loans. These instruments are equity-like in nature, as per Ind-Ra’s assessment, based on their terms and conditions shared by the management. These are subordinated to the senior debt and will be paid off only after all the restricted payment conditions of the senior term loan are met and have no right to call an event of default. The waterfall arrangement also delineates the subservient nature of the sponsor debt obligations. Ind-Ra has not factored in any payment to these junior instruments for arriving at the senior debt coverages. The inclusion of these funds into the senior debt category will impact the rating.

The Negative Outlook reflects a decline in PLF of both TT1 and TT2 due to grid availability (GA) issues and low irradiation, respectively, leading to a moderation in debt service coverage ratio (DSCR) as compared to Ind-Ra’s estimates.

However, the rating is supported by the presence of a long-tenor, fixed tariff power purchase agreement (PPA) for the entire capacity of TT1 and TT2, timely receipt of revenue payments in TT1 and presence of a debt service reserve (DSR) as per the requirements of financing documents. However, the rating is constrained by the grid curtailment issues being faced by TT1 and lower generation in TT2, due to low irradiance. Ind-Ra has taken comfort from the historical track record of the sponsor in supporting its subsidiaries to address the receivable elongation. The creation of second quarter of DSR for TT2 adds further comfort to the rating. Timely sponsor support remains a key rating monitorable.

Key Rating Drivers

Muted Generation Levels: TT1’s power generation continues to be lower than the P90 estimates, primarily due to grid curtailment issues. During the 12 months ended December 2022, TT1’s PLF was about 14%, lower than the P90 estimate (adjusted for degradation). While the grid upgradation works are under development, the timelines for alleviation of GA issues could be elongated due to delays in the completion of these works. Ind-Ra has considered higher PLF in FY26, assuming the grid issues will be addressed by FYE25. Ind-Ra takes comfort from the fact that the project’s cash flows even at the existing muted generation levels are comfortable to meet all of its obligations.

TT2’s net average PLF for the 12 months ended December 2022 was about 18%, lower than the P90 estimate (adjusted for degradation). The project’s performance was severely impacted due to low irradiation. Ind-Ra will critically monitor the project for consistent annual PLF performance of above 22%. Any sustained dip in the PLFs would be a credit negative.

Moderate Counterparty Profile: Ind-Ra’s counterparty assessment relies on the PPA clause, which articulates that the tariff payment obligations on monthly bills and supplementary bills are a direct obligation of Solar Energy Corporation of India Limited (SECI). Thus, the tariff payments do not depend on the realisation of revenue by SECI from the distribution utilities. Hence, SECI fares better in terms of meeting tariff payment obligations pertaining to TT1 than when directly selling to most distribution utilities.

While 60% of the pool capacity is tied up with SECI, which continues to pay within 14 days from invoicing, with a 2% rebate, the remainder capacity of TT2 has Bangalore Electricity Supply Company Limited (BESCOM) as the counterparty, wherein there have been delayed payments since FY21. In FY22, receipts were irregular and cleared in lumpsum. However, the last payment for the invoice of October 2022 has been received within timelines. Ind-Ra will continue to monitor the receivable days from BESCOM.

Obligor-Co-obligor Structure Strengthens Credit Profile: The ratings draw strength from the obligor-co-obligor structure, with TT1 and TT2 having access to each other’s surplus cash flows (after debt servicing and maintaining of DSR) to meet any shortfall in funds for debt servicing. The terms of the transaction specify required support to be checked and extended by the surplus SPV three days before the debt servicing due dates, thus ensuring timeliness of debt servicing. The presence of a cross-default clause between the two entities provides further comfort. However, individual financial covenant testing at individual project level limits the strength of the structure. In addition to the structural benefits, the pooling of the two entities provides diversification benefits in terms of counterparty risk.

Long-term Offtakes Secure Cashflows: TT1’s credit quality is anchored by its 25-year PPA with SECI, a central government undertaking, at a fixed tariff of INR4.43 per unit. TT2 (owning 20MWAC capacity) benefits from the firm, long-term PPA with BESCOM at a fixed tariff of INR3.04 per unit. Both the PPAs provide for payment security mechanisms in the form of a revolving letter of credit equivalent to one month’s average billing, which are yet to be renewed the off-takers. Ind-Ra considers the revenue risk for the projects to be limited, given the fairly healthy revenue visibility over the balance life of the project. The ratings take further comfort from the must-run status awarded to the renewable projects.

Moderate Sponsor Profile: TT1 and TT2 are 100% subsidiaries of Solar Arise India Projects Private Limited (SAIPPL), an Indian solar independent power producer, focused on developing, owning and operating solar assets in the country. In January 2023, Thomas Lloyd Energy Impact Trust PLC (TLEI), one of the existing investors, has purchased the 100% stake in SAIPPL from Core Infrastructure India Fund Pte Ltd and Global Energy Efficiency & Renewable Energy Fund. TLEI intends to raise USD750 million (of which USD150 million has been raised till date) to invest in sustainable energy infrastructure assets in Southeast Asian nations. The group’s renewable portfolio in India includes operational capacity of 170MW and under-construction capacity of 125MW. SAIPPL, a debt-free holding company for all the projects being implemented by the group in India has reported revenue of INR308.3 million in FY22 (FY21: INR269 million), with an operating margin of 61% (63%). It had surplus cash of about INR800 million as on 10 January 2023 which can be used for supporting the group entities, as and when required. Also, the promoters have a demonstrated track record of supporting the group’s projects by infusing cash to meet any shortfall.

Low Operations Risk: Both TT1 and TT2 have five-year fixed price (with fixed annual escalation) contracts with established contractors, Juwi India Renewable Energies Private Limited and Jakson Limited, respectively, for the operations and maintenance (O&M) activities of the plants. Given the less complex nature of operating a solar plant, Ind-Ra has assessed the operations risk of these two projects to be low. While TT1’s contract would expire by FYE23, Ind-Ra will monitor the renewing or signing of new O&M contracts at competitive prices; the operating costs being significantly higher than Ind-Ra’s estimates could have a negative impact on the rating.

Liquidity Indicator – Adequate: As per the agency’s base case scenario, the projects on a consolidated basis have an average DSCR of above 1.15x over their loan tenors, with the ability to withstand moderate levels of stress on generation levels, interest rates and operating costs. The debt has standard project finance features, including a DSR equivalent to one quarter’s debt servicing requirements and an inverter replacement reserve to be fully funded by FY31 (inverter reserve of INR2.5 million created for both TT1 and TT2 as of 31 December 2022). Furthermore, the creation of second quarter DSR for TT2, acts as an additional buffer. TT2 has relied on sponsor support to meet its debt servicing in FY22 and 3QFY23, and management has confirmed that support will be provided in a timely manner ahead of accessing the DSR. In addition, TT1 and TT2 had free cash balances of INR19.6 million and INR25.1 million, respectively, on 15 December 2022. Ind-Ra will continue to monitor the liquidity and support from the sponsor, and any dip in the DSR would be a credit negative.

Moderate Debt Structure: The term loans are repayable in structured monthly instalments commencing in April 2021 and ending in March 2038 and September 2039 for TT1 and TT2, respectively. The interest rate is fixed for the first five years and will be reset every five years after disbursement. In addition, both the projects have a healthy tail period of about five years.

Ind-Ra has considered that the INR80 million of undisbursed amount in TT1 will be disbursed only after TT1 fulfils the PLF-related condition stipulated in the loan agreements. Hence, the DSCR does not include INR80 million, as the PLF has been lower than the levels stipulated in the loan agreement. Ind-Ra will monitor for any consequence in case of a breach in financial covenants of TT2 in FY23.

Moderate Technology Risk: Both the projects employ polycrystalline solar photovoltaic modules with a fixed tilt manufactured by established suppliers for 100% project capacity. A 10-year product warranty and a 25-year performance guarantee provide further comfort with regards to the solar module’s performance. Ind-Ra’s base case factors in a module degradation of 0.7% per annum each year. Ind-Ra considers technology-related risks of the projects under the structure as moderate, as all the equipment suppliers have a proven track record and experience, and have provided warranty for defects as well as minimum output.

Rating Sensitivities

Outlook Revision to Stable: Significant completion of grid upgradation work leading to GA above 98% for sustained period and average actual PLF (calculated for trailing 12 continuous months) of TT2 above 22% could lead to an Outlook revision to Stable.

Negative: Future developments that may, individually or collectively, lead to a rating downgrade are:

– a sustained operational or financial underperformance leading to forward-looking average DSCR falling below 1.15x on a combined basis,

– continuing underperformance in PLF, especially in TT2,
– sustained delays in receivables beyond 120 days for BESCOM,
– dip in DSR and other stipulated reserves, and absent timely sponsor support,

– deterioration in the credit profile of the sponsor and the counterparties.

Company Profile

TT1 owns and operates a 30MW solar power project, built at a cost of INR2,274.6 million, in the Koppal district of Karnataka. The project was won through reverse bidding in 2016. The project has signed a 25-year PPA with SECI at a fixed tariff of INR4.43/kWh, along with a viability gap funding of INR220.5 million (INR7.35 million/MW).

FINANCIAL SUMMARY

Particulars (INR million)	1HFY23	FY22	FY21
Operating revenue	100.3	236.4	250.8
Total revenue	117.8	241.2	255.6
Total operating expenses	21.3	53.7	49.9
EBITDA margin (%)	81.9	77.7	80.5
Finance cost	71.5	189.0	196.0
EBITDA interest coverage (x)	1.3	1.0	1.0
Source: TT1

Solicitation Disclosures

Additional information is available at www.indiaratings.co.in. The ratings above were solicited by, or on behalf of, the issuer, and therefore, India Ratings has been compensated for the provision of the ratings.

Ratings are not a recommendation or suggestion, directly or indirectly, to you or any other person, to buy, sell, make or hold any investment, loan or security or to undertake any investment strategy with respect to any investment, loan or security or any issuer.

Complexity Level of Instruments

Source: indiaratings

New research shows porpoises not harmed by offshore windfarms – EQ Mag

Anand Gupta — Fri, 20 Jan 2023 05:06:15 +0000

Paris (France) : Researchers in Scotland have developed a tool to help ensure porpoises are not being harmed by the construction of offshore wind farms, which are crucial for scaling up renewable energy globally.

The pile driving required to build offshore turbines can harm or even kill noise-sensitive marine mammals like porpoises, sparking concern among environmentalists.

To move them away from the construction sites, acoustic deterrents (ADDs) are often installed underwater: delivering sound at specific frequencies and volumes that temporarily drive the porpoises away.

These devices have been used for years, but it was hard to precisely track how far the porpoises were travelling, and for how long. Without knowing this, no one could be sure if the animals were avoiding harm.

But researchers have improved the technology to track the marine mammals, confirming in fact that they were avoiding injury caused by noise from the turbine building site in the study area.

“It’s the first time that we’ve been able to directly show that the porpoises are swimming directly away from the ADDs… which is what we want,” lead author Isla Graham of the University of Aberdeen told AFP.

The findings, published Wednesday in the Royal Society journal, help to assuage fears that building offshore wind farms harm nearby cetaceans, by ensuring that ADDs actually work.

Offshore wind farms are crucial for the green energy transition to limit global warming to 1.5 degrees Celsius, and have the potential to generate massive amounts of energy compared to onshore projects.

“There are obvious climate benefits to the expansion of renewable energy. But that needs to be balanced with the potential impacts that it could have — negative impacts, positive impacts too,” Graham said.

In 2021, of the total wind capacity installed globally, 93 percent was onshore, with the remaining offshore, according to the International Energy Agency.

‘Seal scarers’

ADDs, colloquially known as “seal scarers”, were initialy designed to keep seals away from fish farms and agricultural sites.

They are commonly deployed during the construction of offshore wind farms, to clear the surrounding site of sound-sensitive animals like porpoises whose hearing can be harmed by noisy pile-driving.

Hearing is very important for porpoises’ communication, social interaction and foraging.

Graham said tracking animals driven away by ADD devices can be hard, since it’s tough to see animals in the water, especially at night.

But the new tool developed by her team allows for more accurate tracking in real time, using seven underwater sound recorders about a kilometre apart, called a hydrophone cluster, to listen to the porpoises.

The study, conducted in 2019 near the Moray East offshore wind farm in the North Sea off the Scottish Coast, found that about half of the porpoises moved up to 7.5 kilometres (five miles) from the site during the piling.

Graham says the tool could be deployed to other sites where sound-sensitive animals, like bottlenose dolphins, are present.

“As those new tools are developed, our hydrophone cluster could be used again, to look at efficacy of those, depending on on the species,” Graham said.

Source: afp

New Breakthrough in Lithium Battery Studies Finds External Magnetic Field to Inhibit Dendrite Growth – EQ Mag

Anand Gupta — Mon, 09 Jan 2023 05:00:54 +0000

Scientists, in the midst of numerous battery energy storage technology in the new era, have placed high hopes on lithium batteries, and are looking to further prolong the battery of smartphones and the driving range of EVs by improving energy density. South Korean scientists have now proposed a new electrolyte solution that increases the stability of lithium batteries.

Traditional lithium-ion batteries adopt graphite and copper as cathode, but the tendency is bound to change for the purpose of extending battery capacity and producing smaller and lighter batteries. Lithium batteries transform traditional cathode into lithium, which would introduce smaller batteries with a higher energy density, though lithium batteries will also encounter dendrites that depletes batteries swiftly.

Daegu Gyeongbuk Institute of Science and Technology (DGIST) has now proposed another idea that may resolve the issue by altering the electrolytic solution and changing the transmission of ions, which prevents dendrites from growing.

The research team first added magnetic nanoparticles to the electrolytic solution, which controls the electrolytes from an external magnetic field that transforms electrolytes from static to dynamic, where the fast and even seed crystals of the lithium core would prevent dendrite growths. A conceptual battery system simulation confirms this under a stable and circulating charging rate.

According to these early studies, the team believes that the particular technology would considerably increase the durability and lifespan of lithium batteries, and could be applied on other electrolytes. Research author Professor Lee Hong-kyung commented that this is a pristine concept on electrolytes that has created a dynamic electrolyte which has never been attempted on before, where electrolytes are altered through magnetic nanoparticles, and can be instantly applied on various liquid electrolytes.

Source: energytrend

This new solar-based water purification system can filter out microplastics quickly – EQ Mag

Anand Gupta — Wed, 04 Jan 2023 05:55:05 +0000

Researchers in South Korea have developed a novel water filter that can remove 99.9 per cent of microplastics

Scientists have developed a new water purification system that can filter out small plastic particles, as well as other pollutants, very quickly and with high efficiency.

The porous material, described in the journal Advanced Materials, may be used as a high-efficiency adsorption material in the future as it has cost competitiveness based on raw materials and enables solar-based water purification process.

“The technology is an unrivaled with the world’s highest purification efficiency, removing more than 99.9 per cent of phenolic microplastics and volatile organic compound (VOC) contaminants in water at ultra-high speeds,” said Professor Park Chi-Young from Daegu Gyeongbuk Institute of Science and Technology (DGIST) in Korea.

“We expect that it will be a universal technology with high economic efficiency that can purify contaminated water and supply drinking water even in areas where there is no power supply,” Chi-Young said in a statement.

Water pollution caused by the rapid development of the chemical industry is a big problem in environmental pollution.

Various water purification technologies and materials have been developed to solve this problem.

The researchers noted that carbon-based porous materials using existing adsorption mechanisms have limitations in that the adsorption rate is slow and high thermal energy is required for recycling.

Various materials have been developed to improve contaminant removal efficiency, but it has been difficult to develop materials that simultaneously satisfy excellent recyclability, high efficiency, economic efficiency of raw materials, and industrialisation potential.

The team synthesised a porous polymer with excellent adsorption performance and photothermal properties by reacting an inexpensive and effective precursor.

The new technology enables a material with fast adsorption of micro-pollutants in the aquatic environment. It was confirmed through experiments that the polymer does not require high thermal energy for recycling and can be used multiple times without loss of performance, the researchers said.

The team produced a water treatment membrane capable of evaporating water using solar energy as a driving force through the developed polymer’s ability to absorb light broadly and convert the absorbed light into heat.

The water treatment membrane coated with the oxidised polymer was confirmed to purify phenolic contaminants through sunlight.

Source: PTI

Paper-thin solar cell can turn any surface into a power source – EQ Mag

Anand Gupta — Thu, 29 Dec 2022 04:43:44 +0000

Researchers develop a scalable fabrication technique to produce ultrathin, lightweight solar cells that can be seamlessly added to any surface.

MIT engineers have developed ultralight fabric solar cells that can quickly and easily turn any surface into a power source.

These durable, flexible solar cells, which are much thinner than a human hair, are glued to a strong, lightweight fabric, making them easy to install on a fixed surface. They can provide energy on the go as a wearable power fabric or be transported and rapidly deployed in remote locations for assistance in emergencies. They are one-hundredth the weight of conventional solar panels, generate 18 times more power-per-kilogram, and are made from semiconducting inks using printing processes that can be scaled in the future to large-area manufacturing.

Because they are so thin and lightweight, these solar cells can be laminated onto many different surfaces. For instance, they could be integrated onto the sails of a boat to provide power while at sea, adhered onto tents and tarps that are deployed in disaster recovery operations, or applied onto the wings of drones to extend their flying range. This lightweight solar technology can be easily integrated into built environments with minimal installation needs.

“The metrics used to evaluate a new solar cell technology are typically limited to their power conversion efficiency and their cost in dollars-per-watt. Just as important is integrability — the ease with which the new technology can be adapted. The lightweight solar fabrics enable integrability, providing impetus for the current work. We strive to accelerate solar adoption, given the present urgent need to deploy new carbon-free sources of energy,” says Vladimir Bulović, the Fariborz Maseeh Chair in Emerging Technology, leader of the Organic and Nanostructured Electronics Laboratory (ONE Lab), director of MIT.nano, and senior author of a new paper describing the work.

Joining Bulović on the paper are co-lead authors Mayuran Saravanapavanantham, an electrical engineering and computer science graduate student at MIT; and Jeremiah Mwaura, a research scientist in the MIT Research Laboratory of Electronics. The research is published today in Small Methods.

Slimmed down solar

Traditional silicon solar cells are fragile, so they must be encased in glass and packaged in heavy, thick aluminum framing, which limits where and how they can be deployed.

Six years ago, the ONE Lab team produced solar cells using an emerging class of thin-film materials that were so lightweight they could sit on top of a soap bubble. But these ultrathin solar cells were fabricated using complex, vacuum-based processes, which can be expensive and challenging to scale up.

In this work, they set out to develop thin-film solar cells that are entirely printable, using ink-based materials and scalable fabrication techniques.

To produce the solar cells, they use nanomaterials that are in the form of a printable electronic inks. Working in the MIT.nano clean room, they coat the solar cell structure using a slot-die coater, which deposits layers of the electronic materials onto a prepared, releasable substrate that is only 3 microns thick. Using screen printing (a technique similar to how designs are added to silkscreened T-shirts), an electrode is deposited on the structure to complete the solar module.

The researchers can then peel the printed module, which is about 15 microns in thickness, off the plastic substrate, forming an ultralight solar device.

But such thin, freestanding solar modules are challenging to handle and can easily tear, which would make them difficult to deploy. To solve this challenge, the MIT team searched for a lightweight, flexible, and high-strength substrate they could adhere the solar cells to. They identified fabrics as the optimal solution, as they provide mechanical resilience and flexibility with little added weight.

They found an ideal material — a composite fabric that weighs only 13 grams per square meter, commercially known as Dyneema. This fabric is made of fibers that are so strong they were used as ropes to lift the sunken cruise ship Costa Concordia from the bottom of the Mediterranean Sea. By adding a layer of UV-curable glue, which is only a few microns thick, they adhere the solar modules to sheets of this fabric. This forms an ultra-light and mechanically robust solar structure.

“While it might appear simpler to just print the solar cells directly on the fabric, this would limit the selection of possible fabrics or other receiving surfaces to the ones that are chemically and thermally compatible with all the processing steps needed to make the devices. Our approach decouples the solar cell manufacturing from its final integration,” Saravanapavanantham explains.

Outshining conventional solar cells

When they tested the device, the MIT researchers found it could generate 730 watts of power per kilogram when freestanding and about 370 watts-per-kilogram if deployed on the high-strength Dyneema fabric, which is about 18 times more power-per-kilogram than conventional solar cells.

“A typical rooftop solar installation in Massachusetts is about 8,000 watts. To generate that same amount of power, our fabric photovoltaics would only add about 20 kilograms (44 pounds) to the roof of a house,” he says.

They also tested the durability of their devices and found that, even after rolling and unrolling a fabric solar panel more than 500 times, the cells still retained more than 90 percent of their initial power generation capabilities.

While their solar cells are far lighter and much more flexible than traditional cells, they would need to be encased in another material to protect them from the environment. The carbon-based organic material used to make the cells could be modified by interacting with moisture and oxygen in the air, which could deteriorate their performance.

“Encasing these solar cells in heavy glass, as is standard with the traditional silicon solar cells, would minimize the value of the present advancement, so the team is currently developing ultrathin packaging solutions that would only fractionally increase the weight of the present ultralight devices,” says Mwaura.

“We are working to remove as much of the non-solar-active material as possible while still retaining the form factor and performance of these ultralight and flexible solar structures. For example, we know the manufacturing process can be further streamlined by printing the releasable substrates, equivalent to the process we use to fabricate the other layers in our device. This would accelerate the translation of this technology to the market,” he adds.

This research is funded, in part, by Eni S.p.A. through the MIT Energy Initiative, the U.S. National Science Foundation, and the Natural Sciences and Engineering Research Council of Canada.

Source: mit

Late Payment Surcharge rules help cut receivables of power producers: India – EQ Mag

Anand Gupta — Wed, 28 Dec 2022 05:17:14 +0000

Late Payment Surcharge 2022 Rules is facilitating receivables reduction for independent power producers, according to India Ratings and Research (Ind-Ra).

India Ratings and Research (Ind-Ra) said the implementation of the LPS Rules 2022 issued by the Ministry of Power on June 3, 2022, has brought in greater discipline from state electricity distribution companies (discoms) in making timely payments to independent power producers (IPPs) in the renewable and thermal power sectors. Ind-Ra’s portfolio has witnessed reductions across most states, significant in some — such as Telangana, Andhra Pradesh and Madhya Pradesh (receivables on October 22 at 30-90 days compared to 120-450 days in May 2022) — and an improving trajectory in others, namely Maharashtra, Tamil Nadu and Karnataka, the statement said.

The scheme encourages payment discipline from discoms, given the risk of losing short and eventually medium- or long-term access to the power supply through the interstate transmission system (ISTS), it added. Along with the reduction, a greater alignment across IPPs and a level playing field with central utilities for payment security provide for greater stability in cash flows and mitigate liquidity pressures in the stressed project, the agency said. Ind-Ra expects ratings in its portfolio in the investment grade to remain resilient; on the other hand, the rules will limit downside risks to stressed projects in the non-investment grade.

However, the EMI (equated monthly instalments) payments for realising the accumulated dues up to June 3, 2022, through the scheme are primarily facilitated by funding from Power Finance Corporation Ltd and/or REC Ltd (IND AAA/Stable), adding to the debt liability of discoms, the agency pointed out. A structural shift in the viability of the entire value chain would necessitate addressing issues of chronic revenue deficits through an operational improvement of discoms, it suggested.

In Ind-Ra’s opinion, while these are being addressed through various schemes and may take time, strict implementation of LPS may provide the bridge to ensure that the sector continues to draw investments in the interim.

Study finds benefits of wind energy instead of fossil fuels on health – EQ Mag

Anand Gupta — Fri, 09 Dec 2022 05:58:29 +0000

Washington [US] : By replacing greenhouse gas and air pollution emissions that would otherwise be created by fossil fuel-based power plants, the renewable energy source benefits the environment, air quality, and public health.

Almost 10 per cent of the electricity used in the United States today is generated by wind.

A new MIT study finds that the health benefits associated with wind power could more than quadruple if operators prioritized turning down output from the most polluting fossil-fuel-based power plants when energy from wind is available.

In the study, published in Science Advances, researchers analyzed the hourly activity of wind turbines, as well as the reported emissions from every fossil-fuel-based power plant in the country, between the years 2011 and 2017. They traced emissions across the country and mapped the pollutants to affected demographic populations. They then calculated the regional air quality and associated health costs to each community.

The researchers found that in 2014, wind power that was associated with state-level policies improved air quality overall, resulting in $2 billion in health benefits across the country. However, only roughly 30 percent of these health benefits reached disadvantaged communities.

The team further found that if the electricity industry were to reduce the output of the most polluting fossil-fuel-based power plants, rather than the most cost-saving plants, in times of wind-generated power, the overall health benefits could quadruple to $8.4 billion nationwide. However, the results would have a similar demographic breakdown.

“We found that prioritizing health is a great way to maximize benefits in a widespread way across the U.S., which is a very positive thing. But it suggests it’s not going to address disparities,” said study co-author Noelle Selin, a professor in the Institute for Data, Systems and Society and the Department of Earth, Atmospheric and Planetary Sciences at MIT. “In order to address air pollution disparities, you can’t just focus on the electricity sector or renewables and count on the overall air pollution benefits addressing these real and persistent racial and ethnic disparities. You’ll need to look at other air pollution sources, as well as the underlying systemic factors that determine where plants are sited and where people live.”

Selin’s co-authors are lead author and former MIT graduate student Minghao Qiu PhD ’21, now at Stanford University, and Corwin Zigler at the University of Texas at Austin.

Turn-down service

In their new study, the team looked for patterns between periods of wind power generation and the activity of fossil-fuel-based power plants, to see how regional electricity markets adjusted the output of power plants in response to influxes of renewable energy.

“One of the technical challenges, and the contribution of this work, is trying to identify which are the power plants that respond to this increasing wind power,” Qiu notes.

To do so, the researchers compared two historical datasets from the period between 2011 and 2017: an hour-by-hour record of energy output of wind turbines across the country, and a detailed record of emissions measurements from every fossil-fuel-based power plant in the U.S. The datasets covered each of seven major regional electricity markets, each market providing energy to one or multiple states.

“California and New York are each their own market, whereas the New England market covers around seven states, and the Midwest covers more,” Qiu explains. “We also cover about 95 percent of all the wind power in the U.S.”

In general, they observed that, in times when wind power was available, markets adjusted by essentially scaling back the power output of natural gas and sub-bituminous coal-fired power plants. They noted that the plants that were turned down were likely chosen for cost-saving reasons, as certain plants were less costly to turn down than others.

The team then used a sophisticated atmospheric chemistry model to simulate the wind patterns and chemical transport of emissions across the country, and determined where and at what concentrations the emissions generated fine particulates and ozone — two pollutants that are known to damage air quality and human health. Finally, the researchers mapped the general demographic populations across the country, based on U.S. census data, and applied a standard epidemiological approach to calculate a population’s health cost as a result of their pollution exposure.

This analysis revealed that, in the year 2014, a general cost-saving approach to displacing fossil-fuel-based energy in times of wind energy resulted in $2 billion in health benefits, or savings, across the country. A smaller share of these benefits went to disadvantaged populations, such as minority and low-income communities, though this disparity varied by state.

“It’s a more complex story than we initially thought,” Qiu says. “Certain population groups are exposed to a higher level of air pollution, and those would be low-income people and racial minority groups. What we see is, developing wind power could reduce this gap in certain states but further increase it in other states, depending on which fossil-fuel plants are displaced.”

Tweaking power

The researchers then examined how the pattern of emissions and the associated health benefits would change if they prioritized turning down different fossil-fuel-based plants in times of wind-generated power. They tweaked the emissions data to reflect several alternative scenarios: one in which the most health-damaging, polluting power plants are turned down first; and two other scenarios in which plants producing the most sulfur dioxide and carbon dioxide respectively, are first to reduce their output.

They found that while each scenario increased health benefits overall, and the first scenario in particular could quadruple health benefits, the original disparity persisted: Minority and low-income populations still experienced smaller health benefits than more well-off communities.

“We got to the end of the road and said, there’s no way we can address this disparity by being smarter in deciding which plants to displace,” Selin said.

“One of the things that makes me optimistic about this area is, there’s a lot more attention to environmental justice and equity issues,” Selin concludes. “Our role is to figure out the strategies that are most impactful in addressing those challenges.”

Source: PTI

Sai Life Sciences releases its Sustainability Report 2022 – EQ Mag

Anand Gupta — Tue, 06 Dec 2022 05:07:12 +0000

Sai Life Sciences releases its Sustainability Report 2022

HYDERABAD, India : Sai Life Sciences, a leading global Contract Research, Development & Manufacturing Organization (CRO/ CDMO), today announced the release of its Sustainability Report 2022, which has been developed as per the Global Reporting Initiative (GRI) standards. With the theme ‘Organising for Sustainability Success’ the Report describes the company’s efforts in progressively reducing the knowing-doing gap by proactively addressing sustainability-related material issues. Read the full report here.

Making the announcement, Krishna Kanumuri, CEO & Managing Director said, “Amid a backdrop of climate change and a recognition of urgency in implementing development goals, Sai Life Sciences continues to transform promises into action in its pursuit of sustainability. Our 2022 Sustainability Report, reflects sustained efforts across economic, environment and social cornerstones, and reiterates our ethos – Make it Better Together.”

The third report released by Sai Life Sciences reveals significant progress in multiple areas. Here are a few of the highlights:

• Retained Silver Medal in the EcoVadis Business Sustainability assessment with an improvement in score from 57 to 63

• Received LEED Gold certification for the Research & Technology (R&T) Centre in Hyderabad

• Achieved increased utilization of renewable energy in manufacturing operations from 53% to 67%

• Received Energy Management System – ISO 50001:2018 certification for Bidar Manufacturing unit

• Awarded the CII Excellent Energy Efficient Unit for the third consecutive year at its Bidar API manufacturing unit

• Qualified for the United Nations Global Compact (UNGC) Active Level based on the Communication on Progress (COP)

As part of its organizational transformative initiative, Sai Nxt, the company made significant progress in advancing its Sustainability agenda:

• Became the first India-headquartered company to join the PSCI membership.

• Joined ACS Green Chemistry Institute Pharmaceutical Roundtable (ACS-GCIPR) as an ‘Associate Member’.

• Received ISO 14001:2015 and ISO 45001:2018 certifications

• Became a signatory of the United Nations Global Compact (UNGC)

The Sustainable Development Goals (SDGs) of the company had been set in 2019 with a three-year timeframe concluding in 2022. Incorporating the learnings from this period, the company is now in the process of envisioning goals and targets for the next phase of its journey.

About Sai Life Sciences

Sai Life Sciences is a full-service CRO-CDMO that works with innovator pharma and biotech companies globally, to accelerate the discovery, development and commercialisation of complex small molecules. The company has over 2200 employees across its facilities in India, UK and USA. Sai Life Sciences is privately held and backed by global investors, TPG Capital and HBM Healthcare Investments.

The clean hydrogen opportunity for hydrocarbon-rich countries – EQ Mag

Anand Gupta — Thu, 24 Nov 2022 06:09:40 +0000

Hydrogen could play an important role in helping hard-to-abate sectors meet climate targets. Countries with hydrocarbon resources and industry expertise can help build and scale the needed technology.

Industry leaders are under pressure as the global climate change debate has amplified the call to limit global warming to 1.5 degrees Celsius.1 Hydrocarbon-rich countries (HRCs) could turn this challenge into an opportunity by taking advantage of their hydrocarbon resources, geographic locations, access to abundant renewable energy (in certain cases), and highly developed infrastructure to develop and export clean hydrogen, defined as hydrogen produced with very low or zero carbon emissions, and its derivatives, including clean fuels.

Clean hydrogen is expected to play a critical role in decarbonizing typically hard-to-abate sectors such as heavy industries and long-haul transport. However, significant challenges must be resolved. The hydrogen value chain is both complex and capital intensive, many segments are not yet developing at the same rate, and staying abreast of constantly evolving technologies and regulations can be daunting.

Numerous recent publications illustrate the increasing attention around this topic. Our analysis builds on current value-chain trends to illustrate how key players in HRCs can leverage their advantaged positions and deep industry experience to become leaders in clean hydrogen. Doing so requires identifying key sources of value and choosing the right roles in the value chain.

According to McKinsey research, total hydrogen demand can reach 600 to 660 million tons by 2050, abating more than 20 percent of global emissions.2 That said, realizing this opportunity will require all relevant stakeholders to come together to develop clean-hydrogen value chains—often across geographies. Those that take decisive action in these areas will be uniquely positioned to create new sources of value and play a leading role in future global energy markets.

Materializing the hydrogen promise

Today, most hydrogen is “gray,” which means it comes from hydrocarbons, typically natural gas. This requires a process known as steam reforming, which releases carbon emissions. “Blue” hydrogen also relies on hydrocarbons but is coupled with carbon capture, utilization, and storage (CCUS) technology, which helps mitigate the environmental impact but can require incremental investments. Finally, “green” hydrogen is created using renewable energy, typically through the electrolysis of water, and results in no emissions.

For the hydrogen promise to materialize for HRCs and for the market to scale, four areas will need to be addressed: scaling competitive supply; stimulating local demand; developing transportation technology; and facilitating corporations across value chains, customers, and countries.

Scaling competitive supply. This requires HRCs to scale up both blue and green hydrogen. Blue hydrogen will play a key role in the short to medium term, together with green in the medium to long term, as it becomes increasingly economically viable. Access to cost-competitive and abundant natural gas or other hydrocarbons coupled with technological disruption in CCUS can allow for the required decline in the cost for blue hydrogen production by 2030. Complementary wind and solar resources and the continued decline in electrolyzer capital costs can also help.
According to a report published by the Hydrogen Council in 2021, the cost of hydrogen for end users could drop by 60 percent from 2020 to 2030.3 This outlook of continuous cost decline is underpinned by International Renewable Energy Agency (IRENA) scenarios by 2030 and 2050.4
Stimulating local demand. To create the foundations of a hydrogen ecosystem, there will need to be a local market for hydrogen in parallel to the development of export corridors. Governments can help by implementing the right regulatory frameworks around decarbonization and clean air to ensure these local demand sectors start. McKinsey analysis shows that with local demand stimulated, steel and ammonia produced using clean hydrogen could be competitive with traditional production pathways by 2030 at carbon prices of around $50 to $100 per ton, depending on local conditions..
Developing transportation technology. Hydrogen must be in liquid form or transformed into ammonia before it can be transported. However, liquefying hydrogen is both costly and technically challenging because it needs to be cooled down to –252 degrees Celsius, which is the lowest boiling point of any element. Our analysis shows that converting hydrogen to ammonia for transport to Europe from the Middle East then converting it back into hydrogen could result in an additional cost of $2.50 to $3.00 per kilogram (kg) of hydrogen in 2030, which is significant, given that green hydrogen production costs could be less than $2.00 per kg by 2030 in the region.
Facilitating cooperation across value chains, customers, and countries. The clean-hydrogen value chain is nascent and will require players across the stages to work together to ensure the value chain develops consistently. For example, long-term offtake agreements between customers such as steel or green fertilizer producers and hydrogen producers could derisk investments in clean-hydrogen projects. Partnerships could enable equipment and infrastructure developers to make investments with some minimum utilization guarantee. Meanwhile, creating government-to-government partnerships could facilitate hydrogen flow between countries, further supporting demand uptake in target markets, and could lock in supply agreements.

Hydrocarbon-rich countries … have a track record of building and scaling up global energy supply by leveraging their unique access to competitive natural resources.

The role of hydrocarbon-rich countries in the scale-up of clean hydrogen

HRCs are a group across geographies and include countries such as Saudi Arabia and the United Arab Emirates as well as the United States and Canada. Most of these countries have a track record of building and scaling up global energy supply by leveraging their unique access to competitive natural resources. In the case of hydrogen, HRCs could also leverage their know-how and competitive reserves to scale up clean hydrogen.

Several factors are expected to drive a competitive supply of hydrogen from HRCs, including access to hydrocarbon resources, cheap renewable energy, strong domestic demand, advantaged location, and a proven track record in establishing global energy markets. HRCs could develop and become leading suppliers of clean hydrogen by leveraging these factors, but their competitive positions may vary depending on the applicability of these factors.

To begin, HRCs are likely to supply blue hydrogen because it provides an outlet for their hydrocarbon reserves, an opportunity to (re)use hydrocarbon reservoirs and midstream infrastructure, as well as an opportunity to maintain positions of leadership in the global energy market. Doing so requires investing in technologies such as CCUS to help ensure blue hydrogen remains competitive after 2030. Because green hydrogen is expected to become competitive after 2030, those with access to competitive, low-cost zero-carbon energy could also build on the green-hydrogen momentum and leverage any favorable renewable-energy sources to hedge the risk of blue hydrogen’s cost competitiveness versus green hydrogen in the decades to come (Exhibit 1).

Building a robust supply of hydrogen could allow HRCs to leverage clean hydrogen to decarbonize downstream industries, such as downstream oil and gas and chemical- and energy-intensive industries, as well as long-distance aviation and marine. HRCs could also repurpose existing gas pipelines for clean hydrogen as demand for additional infrastructure grows, helping spur investment in port infrastructure and national carriers or transport ships.

Taking the lead: Identifying sources of value and choosing the right roles in the value chain

HRCs could gain leadership positions in the future hydrogen market by identifying the sources of value creation and using a number of distinct business models (Exhibit 2). For instance, NEOM, ACWA Power, and Air Products have committed to invest $5 billion into an integrated power hydrogen, and ammonia production plant—including export facilities—by 2025.5 At the time of publication, more than 680 large-scale projects have been announced globally, representing more than $240 billion in mature investments.

Identifying key sources of value

Many players have focused on the entire value chain by developing integrated projects to derisk what could potentially be limited or slow development of certain segments of the value chain. Other players, mainly original-equipment manufacturers, have focused on specific value-chain verticals.

Developing the right plays in the hydrogen value chain

There are six plays ideally suited for building on the competitive advantages of players in HRCs: 1) hydrogen equipment manufacturing, 2) hydrogen production, 3) carbon capture, utilization, and storage, 4) hydrogen transportation, 5) clean-hydrogen downstream production (such as blue or green steel or synthetic fuels) and 6) integrated project developers (Exhibit 3).

Hydrogen is a necessary part of curbing greenhouse gas emissions across the world while ensuring sufficiently stable and affordable energy supply.

Hydrogen equipment manufacturing: HRCs with high aspirations in hydrogen and a strong manufacturing sector could set up a hydrogen equipment manufacturing champion to facilitate the national road map and to become a global equipment supplier. That said, the most logical equipment manufacturing plays are owned by original-equipment manufacturers, and the kind of equipment plays that would likely make the most sense would be in the final tier of the supply chain, such as the assembly of components in electrolyzer or CO₂-capture equipment. Localizing manufacturing could help secure access to critical electrolyzer or carbon-capture equipment in the event of potential supply-chain constrains associated with projected growth in the hydrogen economy. Furthermore, developing carbon-capture or electrolyzer assembly can also help create jobs and contribute to GDP.
Hydrogen production: National oil companies and renewable developers can ensure demand for hydrocarbons or renewable resources. According to the Achieved Commitments scenario in our 2022 Global Energy Perspective, hydrogen will consume 650 billion cubic meters (bcm) of natural gas per year and 17,400 terawatt-hours of electricity per year in 2050, which corresponds to up to 25 percent of expected global renewable generation by that time.6 Chemical companies, particularly those with significant exposure to industrial gases, such as gray hydrogen, have a majority of the capabilities and assets required to produce clean hydrogen today. All three players have experience developing, executing, and operating capital-intensive, complex industrial projects required to develop clean-hydrogen projects.
Carbon capture, utilization, and storage: HRC players such as national oil companies, utilities, chemical companies, and energy-intensive industries are the top contributors to national greenhouse gas (GHG) emissions and subsequently could have an important role to play in developing CCUS. Not only is CCUS critical for blue hydrogen production but also it offers opportunities to decarbonize operations across companies’ portfolios. In addition, captured carbon can be used in existing operations, such as enhanced oil recovery or in future products, such as synthetic fuels.
Hydrogen transportation: There is ample opportunity for HRCs with strong export infrastructure, shipping sectors, and pipeline networks. To begin, national oil companies can repurpose existing gas pipeline infrastructure or develop new hydrogen networks to facilitate transportation. They can also partner with ship builders to develop hydrogen carriers. A number of carriers of liquefied hydrogen will be required to facilitate a global clean-hydrogen market by 2030. Meanwhile, utilities and developers of renewable energy sources can leverage existing pipelines or develop new ones to transport hydrogen locally. National oil companies and utilities can also invest in the electric grid to facilitate the transmission and distribution of green electricity. In Europe, an estimated 39,700 kilometers of hydrogen pipeline infrastructure could be installed by 2040, connecting low-cost production locations with demand hubs.7 Finally, shipping companies could see ammonia transport opportunities, ultimately leading to the development of liquid hydrogen carriers. On this point, green and blue ammonia transport could increase shipped ammonia volumes in 2030, as compared to the scenario in which clean hydrogen is not adopted.
Clean-hydrogen downstream production: HRCs with either developed downstream industry or access to cheap hydrogen could become suppliers of clean end products, such as green ammonia. National oil companies could decarbonize products using hydrogen as feedstock. And chemical companies could see new opportunities in the production of green and blue ammonia, for which gray hydrogen is currently a feedstock. The same applies to energy-intensive industries, such as steel. The Hydrogen Council’s 2021 report shows that green steel can cost as little as $515 per ton of crude steel, representing a premium of $45 per ton of CO2e by 2030.8 Leveraging downstream assets and industries, HRC countries have an opportunity to capitalize on growing demand for decarbonized products driven by shifting consumer preferences and regulations. For example, our analysis shows that global low-CO2 flat-steel demand could grow to more than about 100 metric tons by 2030. This could be addressed with hydrogen direct reduced iron making (H2-DRI), with the exception of about ten to 20 metric tons, which will come from scrap and electric arc furnaces (EAFs).
Integrated project developers: National oil companies can leverage their strong cross-value-chain positions to derisk project and downstream industries as well as their G2G relations to help secure demand. This play is a good fit for oil companies with advantaged access to energy resources, such as hydrocarbons and green energy, as well as advantaged geography, a broad set of energy off-taker relations, and substantial local demand driven by local industries over the long term.

Next steps for HRCs to play a prominent role in hydrogen

All stakeholders in HRCs, including governments as policy makers and regulators, national oil companies (NOCs), investment funds, utilities, and downstream industries, have key roles to play in setting up their respective countries on a successful path as the world adopts clean hydrogen.

Governments can play a leading role in the initial development of the hydrogen economy both locally and internationally. Doing so would require developing hydrogen road maps, including setting ambitions for national hydrogen production, implementing regulations to decarbonize different sectors to spur local demand for hydrogen, setting up G2G partnerships to secure demand for local hydrogen exports, developing a perspective on the localization of hydrogen production across the value chain, and supporting hydrogen deployment through regulatory support.

Stakeholders in hydrogen value chain in HRCs will need to develop their hydrogen strategies to identify the relevant opportunities for them along the hydrogen value chain and assess where to compete. These could include utilities playing the role of green hydrogen producers; NOCs supporting development of technologies that are critical for hydrogen development, namely CCUS, liquefied hydrogen transport, direct air capture (DAC), and hydrogen fuel cells for trucks; NOCs investing in midstream infrastructure; and downstream players producing green products, such as green steel and green ammonia, and capturing their value pools. Last, players in HRCs will need to work on a number of enablers, including talent development, forming partnerships to ensure development of the required technology, expansion of the supply market, and long-term demand partnerships or offtake agreements.

HRCs have traditionally played an important role in supplying the world’s energy needs. They also benefit from access to the resources required to produce green and blue hydrogen at competitive costs. They offer a key unlock in scaling green and blue hydrogen supply and accelerating cost reductions. Partnerships with hydrogen stakeholders in HRCs can offer companies and countries opportunities to gain exposure to the hydrogen economy and, more important, offer a path to decarbonize their respective operations and sectors.

Hydrogen is a necessary part of curbing GHG emissions across the world while ensuring sufficiently stable and affordable energy supply. HRCs are in a unique position to help develop and scale the technology. Those that take the right actions today will not only help stay ahead of the curve accessing new and growing value pools but will also help provide a cleaner, greener future.

Source: mckinsey

India Ratings Assigns JSW Renewable Energy (Vijayanagar)’s RTL ‘IND A+’/Stable; Affirms Existing Ratings – EQ Mag

Anand Gupta — Mon, 21 Nov 2022 05:36:22 +0000

India Ratings and Research (Ind-Ra) has taken the following ratings actions on JSW Renewable Energy (Vijayanagar) Limited’s (JREVL) debt instruments:

$Ind-Ra has affirmed the unsupported rating of ‘IND A+’/Stable for the same amount and maturity, in compliance with the Securities Exchange Board of India’s circular dated 13 June 2019, which requires credit rating agencies to disclose unsupported ratings without factoring in the explicit credit enhancement (CE) and supported rating after factoring in the explicit CE.

*The long-term RTL facility has been tied up as long-term finance to fund the project cost, and part of the proceeds will be utilised to repay the LC facilities at the time of maturity.

Ind-Ra has equated the rating of LC facility of INR2,500 million with those of JREVL’s 74% ultimate parent JSW Energy Limited (JEL; ‘IND AA’/Stable), as the latter has extended an unconditional and irrevocable pre-default guarantee against them. JEL holds 74% stake in JREVL through its 100% subsidiary JSW Future Energy Limited (JSWFEL).

The ratings reflect timely completion of solar power project and the comfort derived from management’s confirmation of support from JEL during the construction and stabilisation period, strong revenue visibility in the form of a long-term power purchase agreement (PPA) at a healthy tariff with a strong counterparty, JSW Steel Limited (‘IND AA’/Stable) and the sponsor’s demonstrated track operating record in the power sector. Furthermore, the debt service coverage ratio (DSCR) at over 1.45x under Ind-Ra’s base case estimates is resilient to a combination of operational stresses. The ratings also benefit from the minimum guaranteed power offtake clause in the PPA and no termination at convenience, which cushions JREVL’s revenue against any downturn.

The ratings, however, are constrained by the construction risk in the wind project and the limited operational track record of the solar project.

Key Rating Drivers

Revenue Secured by Long-Term PPA with Strong Counterparty: The ratings are anchored by the presence of a 25-year PPA with JSW Steel for the entire project capacity of 825MW at a fixed tariff. The PPA specifies a round-the-clock contracted capacity of 275MW with a minimum annual supply equivalent to 80% of the contracted capacity, failing which penalties will be levied at the PPA tariff. The presence of long-term PPA assures cash flows to the project and largely mitigates the revenue risk. Furthermore, the PPA can be terminated by either party, only if the event of default clause is breached by the other party. The PPA includes provision for liquidated damages in case of a shortfall in the supply from JREVL, lower compensation from the customer in case the energy offtake is lower than minimum offtake obligation, and a payment security mechanism. On an average, JSW Steel has been making payments within the stipulated due date since the commencement of supply of power in April 2022.

Adequate Sponsor Experience: JEL, which owns 74% stake in JREVL through JSWFEL, is engaged in power generation and transmission, primarily in Karnataka, Maharashtra, Rajasthan, and Himachal Pradesh. The company has its presence across the power sectors, including generation, power transmission, mining, power plant equipment manufacturing and power trading. JEL has a total generation capacity of 4,784MW, of which 3,158MW is thermal power, 1,391MW is hydropower and 235MW is solar power. JSW Steel owns the balance 26% stake in JREVL. JSW Steel, a member of the JSW Group, is an integrated manufacturer of a diverse range of steel products with a total steel-making capacity of 28 million tonnes per annum. It is among the leading producers and exporters of coated flat steel products with an export presence in over 100 countries.

JEL, being a new entrant in renewable energy (RE), lacks a track record in commissioning RE projects. However, Ind-Ra believes the existing under construction wind project would be completed within the estimated cost of INR40.52 billion, in view of JEL being a major player in the power sector and given its track record of completing projects within the approved cost and time. Also, JEL, on a standalone basis, had unencumbered cash and cash equivalents of INR16.02 billion and an undrawn working capital limit of INR15,000 million as of 30 September 2022. At the sponsor level, the cash flow from operations would be sufficient for meeting the equity requirements of the under construction projects.

Corporate Guarantee and Sponsor Undertakings: JEL has extended a pre-default corporate guarantee towards the LC facility of INR2,500 million and a post-default guarantee for another INR5,100 million LC facility. The project will continue to benefit from this until the maturity of these LCs. Furthermore, for the RTL, the sponsor has undertaken to fund any cost overrun in implementing the project, security creation, ensuring that the project revenue matches with the lender’s base case for at least two of the initial three years from the commercial operations date, creation of a debt service reserve account equivalent to one quarter of debt service requirement in accordance with the terms of financing document, among others. Ind-Ra believes the project will continue to receive the managerial and financial support from the sponsors during the entire construction and operational phase. Any change in the group’s policy of timely supporting the project is a key rating sensitivity.

Liquidity Indicator – Adequate: Ind-Ra believes should the generational level be equal to P90 level, the DSCR will be adequate to cover stresses in the operations and maintenance (O&M) expenses and interest rates. Equity requirement from JEL and JSW Steel are INR9,723.6 million and INR3,416.4 million, respectively. As on 30 September 2022, INR5,420 million of the equity was infused in the project in the form of paid-up share capital as well as loans from parent/ sponsor. Additionally, INR770 million of equity has been infused by JSW Steel to adhere to the regulatory norms regarding group captive arrangements. The solar project has been receiving payments from JSW Steel within the due date since the commencement of supply of power in mid-April 2022. Also, a comfortable average DSCR of above 1.45x in Ind-Ra’s base case provides adequate internal liquidity buffer for timely debt servicing. Ind-Ra believes should the generational level be equal to or above P90 level, the DSCR will be adequate to cover moderate stresses in the O&M expenses and interest rates.

Nascent Stages of Implementation of Wind Project: JREVL is developing an 825MW hybrid plant (225MW solar and 600MW wind) at a project cost of INR52.55 billion, which is being funded in a debt-equity ratio of 75:25. The agency draws comfort from the group’s track record of timely project execution. As per management, the entire solar capacity built on 960 acres of land has achieved commercial operations in August 2022, wherein the supply of power to JSW Steel has commenced from mid-April 2022 for the operational capacity. JREVL shall build another 22km dedicated transmission line connecting the wind power sub-station to the solar power sub-station, which is further connected to the Vijayanagar thermal plant sub-station.

For the wind power plant, 223 land parcels are spread across several villages, and 151 land parcels have been acquired (68%) till end-October 2022. The balance, which is part of a forest, government and private land are under various stage of approvals and would be acquired over the near term. The project shall be implemented by the company itself on a descoped model, wherein wind turbine generators (WTGs) shall be procured from renowned manufacturers. The timeline for completion of the wind project is 31 March 2024, as confirmed by management. Given the completion of construction of solar power project within the scheduled timelines and expertise of JSW Group in executing large infrastructure projects, the construction and completion risks are moderate. The timely commissioning of the project without any major debt-funded cost-overrun remains a key rating monitorable.

Comfortable Debt Profile: The total envisaged promoter’s contribution in the project cost would be brought in by way of equity share capital, quasi equity and/or subordinated loans from the promoter or its associate companies. JSW Steel (captive power procurer) shall hold a 26% stake in JREVL, as per group captive regulation, and infuse 26% of the equity requirement before the scheduled COD. JREVL has tied up long-term debt amounting to INR39,400 million, as envisaged. As per the amortisation schedule, the term loan is repayable over 68 and 65 quarterly instalments, commencing from 30 September 2023 and 31 March 2025 for the solar and wind project, respectively. The project has a sufficient tail period of about six years. In addition, the term loans have standard project finance features, including a cash flow waterfall, a DSCR-linked cash sweep mechanism and a DSRA equivalent to one quarter of principal and interest payments to be created within 12 months of COD. Management has confirmed that the part of disbursals from the RTL will be utilised to repay the existing LC facilities of INR7,600 million (INR5,590 million outstanding as on 30 September 2022) at the time of maturity.

Moderate Technology Risk: JREVL plans to procure WTGs from M/s GE Wind Energy, a US-headquartered WTG supplier with an installed capacity of over 62GW worldwide. According to the wind resource assessment report, GE Wind Energy’s 2.7MW WTGs having a hub height of 130 metres and a rotor diameter of 132 metres are selected for this project. The project’s revenue and operating cash flows are directly correlated with wind speed. Thus, the accuracy of the wind assessment studies and energy production forecasts done by wind forecaster (TUV Rheinland (India) Pvt Ltd) is critical. Management has procured polycrystalline-based solar module technology from Tier 1 supplier JA Solar International Limited and inverters from Sineng Electric Company Limited. Furthermore, the polycrystalline-based solar module technology has an operational record of over 30 years, thereby mitigating technology risks to a greater extent. Ind-Ra has assumed P90-PLF for its base case projections as per the solar resource assessment study done by Tata Consulting Engineers Limited and wind resource assessment by TUV Rheinland (India) Pvt Ltd. The actual performance of wind and solar plant will need to be monitored after the plant becomes fully operational.

Moderate Operating Risk: The O&M of the entire solar plant will be carried out by Sterling and Wilson Solar Limited for a period of one year from commissioning. The complexity of solar project operations is inherently low. Power generation in line with P90 estimates and efficient operations of the plant are of paramount importance to the ratings. A substantial increase in operating expenses, beyond Ind-Ra’s base case estimates, could impact the ratings.

Rating Sensitivities

For CE Rating
Positive: An upgrade of JEL’s rating will lead to a positive rating action.
Negative: A downgrade of guarantor’s rating, absent sponsor support or any transgression from the stipulated mechanism could result in a negative rating action.

For Unsupported Rating
Positive: Successful commissioning of majority of the project capacity within the scheduled timelines will lead to a positive rating action.

Negative: Future developments that may, individually or collectively, lead to a rating downgrade are:
– delays in project completion,
– deterioration in the credit profile of the sponsor,
– deterioration in the credit profile of the off-taker.

Company Profile

JREVL, a wholly-owned subsidiary of JSWFEL, which in turn is wholly owned by JEL is implementing a 825MW project, comprising of 225MW of solar power project and 600MW of wind power project in Bellary district of Karnataka.

The 100% capacity will be supplied on captive basis to JSW Steel. As per management, the solar project commenced full commercial operations in August 2022, while the wind project is estimated to commence commercial operations estimated COD in March 2024.

FINANCIAL SUMMARY

Particulars (INR million)	1HFY23 (Provisional)
Total revenue	608
Operating expenses	207.5
EBITDA	400.5
Cash and cash equivalents	287.3
Finance cost	303
Source: JREVL

Solicitation Disclosures

Rating History

Instrument Type

Current Rating/Outlook

Historical Rating/Outlook

Rating Type

Rated Limits (million)

Rating

28 June 2022

RTL	Long-term	INR39,400	IND A+/Stable	–
LC	Long-term	INR2,500	IND AA(CE)/Stable	IND AA(CE)/Stable
LC	Long-term	INR5,100	IND A+/Stable	IND A+/Stable
Unsupported rating	Long-term	–	IND A+/Stable	IND A+/Stable

Annexure

Financial Covenants

Maximum total debt to equity ratio

4.0x

Minimum annual DSCR	1.2x
Minimum fixed asset coverage ratio	1.15x
Minimum interest coverage ratio	1.5x

Bank wise Facilities Details

Complexity Level of Instruments

Kalpataru Power Transmission net up 18 pc to Rs 98 crore in September quarter

Anand Gupta — Sat, 12 Nov 2022 06:12:22 +0000

Kalpataru Power Transmission Ltd (KPTL) on Thursday posted an 18 per cent rise in consolidated net profit at Rs 98 crore for the September quarter, helped by higher revenues.

The consolidated net profit of the company stood at Rs 83 crore in the quarter ended September 30, 2021, it said in a BSE filing.

Total income rose to Rs 3,808 crore in the quarter from Rs 3,563 crore in the same period a year ago.

The board of directors has approved the appointment of Shweta Girotra as Company Secretary and key managerial personnel of the firm with immediate effect, it added.

Manish Mohnot, MD & CEO, KPTL, said in a statement, ”We have delivered notable growth in revenue, EBITDA and net profit in Q2 FY23 and H1 FY23, on the back of our resilient and diversified business model.” ”Despite the ongoing volatility and disruptions in the global business environment, we continue to make significant strides with order wins in focused business segments and key markets,” he added.

”Our order book is at an all-time high of Rs 38,550 crore with YTD (year to date) order wins of Rs 14,388 crore and L1 (successful bidder) of over Rs 6,000 crore,” he informed.

”We continue to progress on our key strategic priorities, including the merger of JMC with KPTL, which will significantly enhance our market position. We will continue to prioritise divestment and restructuring of non-core businesses and assets. Looking ahead, we expect strong revenue growth, stable EBITDA margins and reduction in net debt in FY 2023,” he said.

Source : PTI

Fuel costs worth $4.2 billion saved through solar power in India: Report

Anand Gupta — Sat, 12 Nov 2022 05:59:00 +0000

Asian countries, including China, India, Japan, South Korea, Vietnam, the Philippines and Thailand, avoided about 9 percent of total fossil fuel costs which is equivalent to $34 billion from January to June 2022.

India has saved around $4.2 billion in fuel costs through solar power generation in the first half of 2022, and about 19.4 million tonnes of coal which would have further stressed an already strained domestic supply, PTI quoted a report.

The report released by the energy think tank Ember, the Centre for Research on Energy and Clean Air, and the Institute for Energy Economics and Financial Analysis, found that five of the top 10 economies with solar capacity are now within Asia. The list included China, Japan, India, South Korea and Vietnam.

Asian countries, including China, India, Japan, South Korea, Vietnam, the Philippines and Thailand, avoided 9 percent of total fossil fuel costs which is equivalent to $34 billion from January to June 2022.

The report added that in India, solar generation avoided $4.2 billion in fuel costs in the first half of the year. The country also avoided the need for 19.4 million tonnes of coal that would have further stressed an already strained domestic supply.

It was found that China saved over $34 billion as solar met 5 per cent of the total electricity demand and avoided around $21 billion in additional coal and gas imports during first half of 2022. After China, it was Japan that saw the second-highest impact with over $5.6 billion avoided in fuel costs. Vietnam’s solar power avoided $1.7 billion in additional fossil fuel costs, a sizable growth from nearly zero terawatt hours of solar generation in 2018, according to the report.

In Thailand and the Philippines, the fuel cost still remains to be notable as growth in solar is still slow. The Philippines avoided $78 million in fossil fuel spending, despite solar accounting for only 1% of generation. On the other hand, solar only accounted for 2 percent of Thailand’s electricity in the first half of 2022, avoiding an estimated $209 million of potential fossil fuel costs.

Solar power generated 5 percent of the country’s electricity in South Korea, avoiding potential fossil fuel use costing $1.5 billion.

Source : PTI

A billionaire emits a million times more greenhouse gases than average person: Oxfam report – EQ Mag Pro

Anand Gupta — Mon, 07 Nov 2022 05:10:19 +0000

We need governments to tackle this urgently by publishing emission figures for the richest people, regulating investors and corporates to slash carbon emissions and taxing wealth and polluting investments, said Nafkote Dabi, Climate Change Lead at Oxfam International.

Oxfam also estimated that a wealth tax on the worlds super-rich could raise USD 1.4 trillion a year, vital resources that could help developing countries – those worst hit by the climate crisis – to adapt, address loss and damage and carry out a just transition to renewable energy.

The investments of 125 of the world’s richest billionaires yield an annual average of three million tonnes of carbon dioxide emissions a year, more than a million times the average for someone in the bottom 90 per cent of humanity, according to a new report by non-profit group Oxfam. These super rich people have a collective USD 2.4 trillion stake in 183 companies. Their investments in polluting industries such as fossil fuels and cement are double the average for the Standard and Poor group of 500 companies, said the report titled ”Carbon Billionaires: The investment emissions of the world’s richest people”. Cumulatively, these 125 billionaires fund 393 million tonnes of CO2e (carbon dioxide equivalent) per year, which is equal to the annual carbon emissions of France, a nation of 67 million people. To put things into perspective, each of these billionaires would have to circumnavigate the world almost 16 million times in a private jet to create the same emissions, the report said. It would take 1.8 million cows to emit the same levels of CO2e as each of the 125 billionaires. Almost four million people would have to go vegan to offset the emissions of each of the billionaires, it said. “The major and growing responsibility of wealthy people for overall emissions is rarely discussed or considered in climate policy making. This has to change. These billionaire investors at the top of the corporate pyramid have huge responsibility for driving climate breakdown. They have escaped accountability for too long,” said Amitabh Behar, CEO of Oxfam India.

Often the high-profile commitments made by corporates do not stand up to scrutiny. The flurry of net zero goals that depend on offsetting are at best a distraction from the need to take short-term measures to reduce corporates’ emissions and have the potential to derail climate action, Oxfam said. In 2021, Oxfam revealed that using land alone to remove the world’s carbon emissions to achieve ‘net zero’ by 2050 would require at least 1.6 billion hectares of new forests, an area equivalent to five times the size of India.

“We need COP27 to expose and change the role that big corporates and their rich investors are playing in profiting from the pollution that is driving the global climate crisis.

“They can’t be allowed to hide or greenwash. We need governments to tackle this urgently by publishing emission figures for the richest people, regulating investors and corporates to slash carbon emissions and taxing wealth and polluting investments”, said Nafkote Dabi, Climate Change Lead at Oxfam International.

Oxfam also estimated that a wealth tax on the world’s super-rich could raise USD 1.4 trillion a year, vital resources that could help developing countries – those worst hit by the climate crisis – to adapt, address loss and damage and carry out a just transition to renewable energy. According to the United Nations Environment Programme (UNEP), adaptation costs for developing countries could rise to USD 300 billion per year by 2030. Africa alone will require USD 600 billion between 2020 to 2030. Oxfam also called for steeply higher tax rates for investments in polluting industries to deter such investments.

“The super-rich need to be taxed and regulated away from polluting investments that are destroying the planet. Governments must also put in place ambitious regulations and policies that compel corporations to be more accountable and transparent in reporting and radically reducing their emissions,” said Behar. The 27th edition of the Conference of Parties (COP) to UNFCCC opened Sunday at Sharm El-Sheikh, Egypt. Negotiations are scheduled to come to a close on November 18.

Source: PTI

Unaudited Standalone and Consolidated Financial Results for the quarter and half year ended September 2022

Anand Gupta — Sat, 05 Nov 2022 07:19:03 +0000

Unaudited Standalone and Consolidated Financial Results for the quarter and half year ended September 2022

For More Detail Click On Below Link :

Intimation of change in outlook by S&P Global Rating

Anand Gupta — Fri, 04 Nov 2022 06:14:40 +0000

Intimation of change in outlook by S&P Global Rating

For More Details Please Click On Below Link :

Sustainable spaces: Countering climate risk in capital projects

Anand Gupta — Thu, 03 Nov 2022 06:53:36 +0000

By taking a deeper, more comprehensive approach to understanding risk, companies can mitigate climate hazards and build resilience into the life cycle of their infrastructure and capital projects.

To manage the risk inherent in long-life-span building projects, infrastructure players have traditionally sought predictable revenue streams. Now, governments, investors, and other industry stakeholders face extreme uncertainty—even as they work to build infrastructure that can meet ambitious net-zero and decarbonization goals for mitigating climate change. In this episode of McKinsey Talks Operations, host Daphne Luchtenberg joins Alex Guy, a partner at the international law firm Ashurst, and Brodie Boland, a McKinsey partner and a leader on climate risk in real estate and infrastructure, to discuss how the sector can become more resilient and sustainable, both economically and environmentally. Their conversation has been edited for clarity.

Daphne Luchtenberg: Your company’s future success demands agile, flexible, and resilient operations. I’m your host, Daphne Luchtenberg, and you’re listening to McKinsey Talks Operations, a podcast where the world’s C-suite leaders and McKinsey experts cut through the noise and uncover how to create a new operational reality.

Climate change is creating new levels of complexity for infrastructure and capital projects such as roads, bridges, buildings, and utilities. Long-term planning has become fraught with uncertainty as leaders seek to invest in projects with long life spans and pursue net-zero targets that are decades away. At the same time, extreme weather is already affecting our built environment in real and immediate ways, from electricity outages to flood-damaged roads. These phenomena affect lives and livelihoods. They alter project economics and cause costly service interruptions. Understanding and mitigating these climate risks will be essential to manage costs and ensure critical continuity. In particular, new projects must be planned, designed, built, and operated to account for climate transitions.

McKinsey’s Global Infrastructure Initiative [GII] convenes senior leaders to exchange ideas and solutions on these critical infrastructure challenges. Today’s segment, in collaboration with GII’s Voices on Infrastructure, features Alex Guy, a partner at the international law firm Ashurst. Alex’s key focus is on transport and infrastructure, and he sits on Ashurst’s global infrastructure industry board. He has over 20 years of experience advising on projects across Asia–Pacific and the UK. We’re also lucky to have Brodie Boland, a partner joining us from McKinsey’s Washington, DC, office. Brodie is a leader in McKinsey’s work on climate risk, particularly in real estate and infrastructure. Today, we’re looking at how climate risk and resilience can be built into capital projects, both early on and throughout the life cycle. Welcome, Alex. Welcome, Brodie.

Brodie Boland: Thank you.

Alex Guy: Thanks very much, Daphne.

Daphne Luchtenberg: Alex, to kick off the conversation here, could you give us an introduction? What’s prompting capital project leaders to prioritize climate resilience and sustainability now?

Alex Guy: Players in the infrastructure market are looking for projects with long-term, steady, sustainable revenues, and those projects have to cover the initial capital expenditure they incur in delivering infrastructure assets. At the outset, they’ve got to pay for their ongoing operating and maintenance costs, and they’ve got to achieve a reasonable return. So you set that desire for long-term stability against the fact that we’re going through a period of extreme uncertainty. And what you get is huge pressure on governments, investors, and market players to prioritize resilience and sustainability.

But it’s not just an issue of climate change and extreme weather events; it’s all against the backdrop of other uncertainties like supply chain issues, sanctions, domestic political risk, hyperinflation, and more. Then on top of that, there’s a lot of capital out there at the moment that’s looking for opportunities that fit within investors’ ESG [environmental, social, and governance] goals. That’s another factor that’s inevitably leading to an increased focus on decarbonization sustainability.

Daphne Luchtenberg: Thanks, Alex. Brodie, are we seeing a similar picture in the conversations that we’re having with clients?

Brodie Boland: Yeah, I think Alex stated it really well. One of the interesting things that has happened over the last couple of years is that we have reached a bit of a critical mass of players and stakeholders in the ecosystem that are really focused on these issues. So if you’re a capital project investor or real-estate owner or investor, you’re now getting questions from your investors, you’re getting questions from your lenders, you’re getting questions from your regulators, you’re getting questions from your shareholders, you’re getting questions from your tenants—if you’ve got them. Just over the past 12 to 18 months or so, that awareness has reached a level where it’s essentially a core part of the consideration of any investment opportunity of any major product development.

Daphne Luchtenberg: And what are stakeholders doing differently to start to think about climate risk embedded into their projects? Alex, how do you work with clients on that?

Alex Guy: What we’re seeing is a much more systematic approach to project design and due diligence than we used to, one that really aims to achieve a better understanding of risks and how to mitigate them. That’s leading to much better-developed mitigation—measures, in general, being built into projects up front to address climate and other risks, which leads to more resilient projects. In fact, at the moment, we’re working on a new standardized due-diligence approach for infrastructure projects that looks to take Ashurst’s existing framework and expand it out to specifically focus on climate-related and other resilience risks in areas like energy costs, carbon reduction initiatives—both voluntary and regulatory—supply chain management, labor issues, domestic and international political risks, technology obsolescence, cybersecurity, and so on.

At the end of last year, we commissioned a survey of our infrastructure clients and industry stakeholders. And as part of that, not surprisingly, governments were seen as having the most significant influence on the sector. A lot of respondents were frustrated at the way those governments were carrying out their roles. In fact, more than three-quarters of the respondents named a lack of coherent government policy as the biggest barrier to a coordinated response to the changes likely to impact the sector. So the challenge is for governments to make a step change in the way they regulate and legislate for the sector, both locally and globally, to create an environment that’s going to encourage more resilient infrastructure to emerge.

The challenge is for governments to make a step change in the way they regulate and legislate for the sector, both locally and globally.

Alex Guy

Daphne Luchtenberg: Brodie, what would you say is needed, in addition to that, to really move the whole movement forward to ensure that we’re using similar standards and approaching this risk in a common way?

Brodie Boland: One of the big shifts that needs to happen is we need to move from a kind of risk register approach to understanding climate risk and resilience to an approach that truly grounds these risks in the fundamental drivers of asset economics. You see a lot of times that kind of scorecard approach where, for example, an asset of one is good and an asset of five is bad. It’s hard to know what to do with that if you’re an operator or if you’re an investor. How bad is four? How good is two? Shifting from that kind of scorecard approach to one that really connects the risks that are likely to be experienced to fundamental drivers of revenue, to fundamental drivers of cost of operations, to uptime, to reliability for an important stakeholder group in a way that allows decision making—it allows folks to figure out, “OK, is it worth making this resilience investment to the asset? Does that generate the level of value creation that we want and need and that fits our investing theses and so on?”

Alex Guy: I completely agree with that, Brodie—and not just about understanding the risks in relation to the project at the outset, but also about taking a more systematic approach to developing mitigation strategies that are perhaps less simplistic than that kind of scorecard approach that you described, so that projects can actually be adapted at the outset to become more resilient and long lasting.

Daphne Luchtenberg: That’s interesting. Alex, when we think about the life span of these projects, which is often very long, how do you inject flexibility and adaptability into that? How do you think about that in terms of mitigating risks?

Alex Guy: Industry stakeholders across the board are working pretty hard at the moment to develop flexible contractual mechanisms to make projects more resilient. One of the things I think really needs to change is the approach to business case assessment on the government side. All players really need to look at their approach on that. It’s no longer good enough to take the previous model and extrapolate it out. There are a whole load of new categories of risks and opportunities out there.

I also mentioned earlier that I think we need better alignment between value and values. For many players in the market, the only way they’re going to affect change is if it’s profitable for them. There needs to be an evolution in mentality from mitigating against the threats of challenge to a mentality that sees challenge as an opportunity—so that governments and businesses can identify and show where the drivers of sustainable growth are, so that taxpayers and the market see the value in the desired outcomes. Therefore, invest in the means of delivering those outcomes.

Daphne Luchtenberg: Brodie, anything you would add there?

Brodie Boland: I love that point about making sure that the value is clear to the broader set of stakeholders. If we think about just the sheer scale of need for investment in this adaptation infrastructure, and in added resilience to existing infrastructure, that’s going to be required over the coming decades, that’s going to be critical. If we’re not able to show that value to a broader set of stakeholders and link that value to the investment that needs to be made in that adaptation infrastructure or resilience investments and existing infrastructure, it’s going to be tough to find the capital to get this done, right?

Daphne Luchtenberg: Brodie, how do you make sure that the infrastructure is resilient in view of climate risk? But, of course, we also have the decarbonization targets that we need to be working toward. So as we build out the infrastructure going forward to 2050, can you see a way that these two objectives can dovetail together?

Brodie Boland: Yeah, and it’s just so critical to make sure that they do and in a few ways. One is, at the project level, many projects can be designed to achieve both objectives. So you can have resilience measures that also serve a decarbonization objective or decarbonization objectives that serve as resilience measures. One simple example of that is building energy efficiency. Energy efficiency investments for buildings both reduce the energy consumption of the building but also make the building more resilient to extreme heat and cold. And there are countless examples like that throughout the built environment.

Whenever possible at the project level, at the portfolio level, at the regional or the country level, we need to make sure that the decarbonization and resilience objectives are paired.

Daphne Luchtenberg: Got it. And that’s part of the value equation, I imagine, Alex, right?

Alex Guy: Yeah, absolutely. And I do agree with what Brodie said. The more that you can highlight to investors and other players in the market the risks that they’re exposed to from climate change, the more likely they are to link their resilience and decarbonization strategies in that way.

Daphne Luchtenberg: So what’s critical here is how to ensure that you’ve got all the data so that you can make the right decisions and calculations. What are some of the challenges? Brodie, I’ll come to you first on getting the decision makers to have access to the right data.

Brodie Boland: I would work backward. Instead of starting from the data and figuring out what data a government, investor, operator, or whoever it is needs, I would start from the impact and work backward to the data. For example, a few characteristics and things that we often see in terms of challenges with data environments are a lot of the hazard data is not granular enough. So if you’re working backward, you will quickly know that a one-square-mile resolution for flood data is just not sufficient. That’s a huge area of a city that, in most cities, includes places that are on hills and places that are in valleys. Getting a sufficient granularity in terms of both space and time of hazard data [is important]—making sure that all the major risks are covered.

You want to be looking across all of the risks, not just whatever data happens to be most easily available. Another important thing is we often focus on the most acute risks. They’re dramatic, they’re big, they’re points in time. In many cases, it’s the chronic risks that are going to have the most damaging effect on assets. If you think about it from the perspective of a building, you can, in some cases, insure against the major flood that happens every three or four years or every ten years. It’s harder to insure and protect against the water gently lapping in the lobby of your building every day. And so really understanding the chronic risks, in addition to the key risks, is important—then, ultimately, making sure they’re able to translate all of that data back into fundamental impact on the asset. How does it affect operations? How does it affect performance of the asset?

Daphne Luchtenberg: Alex, anything to add there?

Alex Guy: Well, some excellent advice there from Brodie. I don’t think you can just take a questionnaire, or whatever, approach to due diligence, or look at the same things you looked at last time and tick the boxes. You’ve got to look at the outset of what are your criteria, what are you trying to achieve, what are your goals? Then design the data, the collection, the data sources, the methodology, and the reporting to match those outcomes so that you can make decisions consistently on a high-quality basis.

Daphne Luchtenberg: Alex, have you seen any examples of things happening that are making you a little optimistic in this area?

Alex Guy: In general, yes. Looking at my home city, Brisbane, as an example, I’m quite optimistic about some of the infrastructure and initiatives that are taking place as part of the planning for the 2032 Olympic Games here. As part of the bid to host the games, Brisbane committed to be the first-ever climate-positive games. There’s a lot of debate about what climate positive actually means. But that commitment is already having a massive impact on project planning by encouraging a focus on decarbonization. As a city that’s experienced at least three extreme flooding events in the past 11 years, we’re going to have to pay a lot of attention to resilience in the lead-up to the games.

Daphne Luchtenberg: Brodie, how about further afield? Have you seen any great examples that can lead the way?

Brodie Boland: Yeah, Alex and I are both thinking about our hometowns. I was in Calgary recently, where I’m from, which had an enormous flood in 2013. At the time, it was the costliest natural disaster in Canada’s history, with major flooding in the whole downtown area. There’s a green-infrastructure project there; it’s essentially a combination of a park and flood mitigation measures. It creates a transportation corridor for cyclists and pedestrians right beside downtown. There are picnic areas, my kids played in a little pool created by the Bow River catchment, my wife and I went for a trail run in the park in the shadows of the skyscrapers of downtown Calgary, and a friend and I sat and chatted by a beaver pond. It was an excellent example of a project that achieved a very important flood mitigation effort that created biodiversity outcomes, livability, increased property values in downtown, activated an area of downtown, and created a number of social benefits for folks in that area. Those kinds of projects make me really optimistic.

Daphne Luchtenberg: It feels like both of those examples have a common purpose, a common vision at the heart of it, which seems to have been shared across the stakeholders. Would that be a fair assessment?

Brodie Boland: Absolutely. I know in Calgary, there was a significant amount of stakeholder engagement of the average citizen, the business community, the experts and flood managers, the transportation planners, and coming up with a project like that. It’s through that kind of stakeholder collaboration that you can get a project that hits the objectives of all those groups.

Alex Guy: Similarly, with Brisbane and the bid for the Olympic and Paralympic Games—that has required a lot of industry stakeholders and others to collaborate and participate together in developing that proposal, and then also in working out how it’s going to be delivered, and particularly how that commitment to be the first-ever climate-positive games will be delivered.

Daphne Luchtenberg: Alex, what other mindsets and models are important? Once you start with that kind of common vision and common purpose, what other things need to be true to be successful?

Alex Guy: We’re talking about uncertainties here and what to do in the face of uncertainty. There is always uncertainty, and smart investors will always move with the times. The mindset that can increase the odds of success is to see challenges but to look for the opportunities in them as well as see the risks. So from a government perspective, it’s asking where are the opportunities to align value with values to create a regulatory environment that encourages the solutions that they’re trying to achieve? And for businesses, it’s where do the challenges actually present opportunities to design solutions to issues arising from climate change and other resilience factors?

Daphne Luchtenberg: Brodie, anything you would add in terms of other success factors?

Brodie Boland: Dealing with climate change, in many ways, can often be extremely overwhelming. It helps to get a handle on the things that you can’t easily get a handle on. You can access some pretty good information and data about what’s likely to happen to your asset. It is certainly probabilistic data, you can’t treat it as a point prediction, but it can be a foundation for just making some better decisions about the design of the asset. In the broader swirl of things that you aren’t able to control, it sometimes helps to do the math on the things that you can. At least get a sense of what might happen in the future and make sure that the asset, the project, etcetera, is being planned accordingly.

Daphne Luchtenberg: Infrastructure and capital assets can be a real vehicle for advancing decarbonization efforts, improving the livelihoods and the environments of our citizens. So there’s a real opportunity, too, right, Alex?

Alex Guy: Absolutely. As Brodie said earlier, resilience and decarbonization are inextricably linked. There are huge opportunities in the development of new technology—for example, in the transport sector, where I do a lot of my work with the move to zero-emission vehicles. I also think the water sector presents a lot of opportunities. As a result of climate change, water is becoming more and more of a concern, both in terms of not enough or too much of it, like the floods we were talking about earlier. I think water infrastructure has to be an area of major focus and opportunity.

Daphne Luchtenberg: Brodie, when talking to clients, where would you say are some of the areas of opportunity where there is white space to act?

Brodie Boland: Green infrastructure—particularly because it does hit both the decarbonization and the resilience objectives—is going to be a real big part of the solution in many places around the world. Then, there is an opportunity for innovative players who are able to think differently about new contracting models, new financial models, or ways in which benefits of a resilience project can be reinvested in improved resilience or an improved decarbonization.

Then, last, there’s a broader opportunity for connecting all of these together in ways that make our cities more livable, more sustainable, more resilient. Alex and I both talked about projects in earlier examples that we were excited about in cities that do achieve multiple objectives. There’s real opportunity for creative designers, for creative infrastructure, for developers and real-estate developers to reshape our cities in ways that make them better places to live, more prosperous, more sustainable, and resilient.

Daphne Luchtenberg: Thank you. So while it’s an uncertain area, it is heavy with risk. We need to continue to move forward, and it feels like you’re both saying there’s some great opportunity here to really build a much, much better world for all of us.

Brodie Boland: Absolutely.

Alex Guy: That’s for sure.

Daphne Luchtenberg: Fantastic. You’ve been listening to McKinsey Talks Operations with me, Daphne Luchtenberg. If you like what you’ve heard, subscribe to our show on Apple Podcasts, Spotify, or wherever you listen. We’ll be back in a few weeks with a new episode.

Source: mckinsey

Accelerating green growth in the built environment

Anand Gupta — Thu, 03 Nov 2022 06:40:45 +0000

The industries that make up the built environment are highly fragmented and slow to change. Creating green growth requires shifts in how players design, build, operate, and decommission assets.

The world is coming together to reduce the amount of carbon in the atmosphere, and all industries and sectors will need to contribute. The built environment is no exception. In fact, this setting—which refers to the full life cycle (design, materials manufacturing, construction, usage, and demolition) of all residential and commercial buildings and infrastructure—is directly or indirectly responsible for approximately 40 percent of global CO₂ emissions from fuel combustion and 25 percent of overall greenhouse-gas (GHG) emissions.1 As a result, it is among the highest-emitting industries, emitting more than electricity production, shipping, and aviation.

issions come from operations and the remaining 24 percent from the processing of raw materials used for and construction of new builds. Given that 80 percent of the predicted building stock for 2050 exists today, it stands to reason that the built environment will need to decarbonize not only embodied emissions but also, more importantly, the operational emissions from the existing building stock.

Today, the physical implications of climate change are clearly visible in the form of floods, wildfires, rising sea levels, and other natural disasters. There is also significant pressure from all market dimensions, including regulatory requirements, shareholder expectations, employee needs, and green premiums paid by customers. To address these issues, industry leaders can work toward improving transparency and awareness, developing partnerships along the value chain, and establishing consistent and reliable metrics. By launching the Net Zero Built Environment Council, we aim to stimulate these changes and help shift the built environment into a cleaner, greener future.

Many levers to decarbonize the built environment are known and proven

To meet net-zero emissions targets by 2050, various industries will need to triple the pace at which they decarbonize compared with the past 30 years. There are several possible decarbonization pathways across materials, design, and technology that collectively could help mitigate a significant portion of overall emissions. Some of these pathways, such as switching to renewable sources of energy for heating systems, have significant potential for reducing emissions, while others, such as reducing waste and improving circularity, are likely to mitigate a smaller proportion of emissions.

Operational emissions

Given that a significant portion of emissions in the built environment stem from operations of existing building stock, lowering these emissions is a key priority. The primary sources driving these operational emissions are heating and cooling. Indirect emissions (from power generation for electricity and commercial heat) constitute 50 percent of the global built environment’s emissions. There are two important factors to consider when decreasing emissions from the operations of existing buildings: the energy source used for heating and the energy efficiency of the building. Key pathways to address these two factors could be upgrading energy and improving insulation. This includes switching to renewable sources for heat pumps and leveraging new technologies such as combined heat and power, infrared heating boards, and hydrogen boilers.

In the European Union, for example, energy upgrades could mitigate up to 30 percent of emissions. The other key pathway is looking at design and insulation levers, which can improve energy performance by mitigating another 30 percent of emissions. This would subsequently reduce the requirement to rely heavily on heating, ventilation, and air conditioning (HVAC) systems.

Embodied carbon

To make the transition to net-zero emissions, upstream aspects of low-carbon-intensive construction materials could also be maximized for tackling embodied emissions during the construction process.

The cement industry is responsible for about a quarter of all industry CO₂ emissions, and it also generates the most CO₂ emissions per dollar of revenue. Addressing cement emissions is therefore critical in propelling the transition. For example, replacing the clinker used in cement with substitutes—such as ground-granulated blast-furnace slag (GGBS), silica fume, or natural pozzolanic materials—and fillers such as limestone could mitigate up to 90 percent of cement’s carbon footprint. Wood construction materials emit anywhere from 20 to 60 percent less carbon than steel and concrete in a typical building. Another alternative is carbon-cured or carbon-neutral concrete, which uses materials based on mineralized or pyrolyzed CO₂ to make long-term carbon storage possible. Today’s methods could sequester up to 5 percent of the CO₂ produced during production, but newer technologies could sequester as much as 25 to 30 percent. Overall, addressing only the emissions from cement using these methods could collectively abate the built environment’s emissions by up to 15 percent.

An important supplement to reducing embodied emissions is developing a closed-loop economy by minimizing waste sent to landfills. This can be improved in several ways, starting with making accurate estimates of required construction materials via tools such as building information modeling (BIM), ensuring the recycling of demolition waste, or, in the case of modular construction, using potential end-of-life building components or products.

Many levers to decarbonize the built environment are known and proven.

There is significant opportunity to build new businesses—often with no additional cost

Decarbonizing the built environment can create as much as $800.0 billion to $1.9 trillion in new green value pools across sectors (Exhibit 1). This promising market offers significant potential for players in the ecosystem. Specifically, there are primary value pools in resilient materials and systems, totaling more than $320.0 billion, and in retrofitting existing assets, totaling more than $240.0 billion.

Exhibit 1

Climate-resilient infrastructure aids in protection from extreme weather events, including droughts, extreme temperatures, flooding, hurricanes, and wildfires. Using double-glazed glass in windows and doors, building green facades, and insulating walls with gypsum wallboards are just a few ways to mitigate extreme temperatures. For instance, green roofs have multiple direct benefits and cobenefits, including lowering indoor temperatures by as much as 5°C, resulting in energy savings; absorbing rainwater and delaying runoff, reducing flood risk due to intense rain events; reducing the temperature in densely built-up areas; providing habitats for urban wildlife and stepping stones for migratory species; and creating a more aesthetically pleasing urban landscape.

In addition, the value pool for retrofitting existing buildings is expected to have an accelerated trajectory from current forecasts of 4 percent CAGR beyond 2035, driven by mounting regulatory pressure and financial incentives, cost savings for building owners and occupiers from actions such as improving insulation, and growing end-user demand for more efficient, less carbon-intensive buildings (Exhibit 2). The uplift in the potential annualized value pool over time is expected to decrease over the next two decades as the number of new technologies and houses stagnates. Realized value will still grow, but the built environment faces several headwinds, such as fragmentation, risk aversion, and slow digitalization.

Exhibit 2

However, there are challenges to overcome

Local market structures and ease of entry have resulted in a fragmented landscape of mostly small companies with limited economies of scale. Moreover, the project-based construction process involves many steps, with scattered accountability and a multitude of active entities in every project—from several specialist-engineering and planning companies to multiple subcontractors and subsubcontractors and a multitude of material suppliers. Since the level of collaboration across the value chain is low, the result is a siloed ecosystem in which companies tend to manage their own risk and frictions at the interfaces are high. Varying governing bodies, local building codes, and standards further aggravate the challenge and lead to decreased productivity, slowing the turnaround time of projects.

Overall, no single player in the ecosystem can tackle the emissions issue alone—and there is an urgent need for players to collaborate and increase transparency. The built environment is complex and fragmented with different players, business models, and value chain steps ; it is also highly local with varying standards, building codes, and decision makers, often with partially conflicting objectives. Arrangements are often project-based with temporary, nonrepetitive agreements, while companies operate on small margins with limited abilities to invest and take risks.

Achieving the necessary scale of decarbonization and value creation to accelerate the green transition requires fundamental shifts in how industry players design, build, operate, and decommission assets. Although some regulations and policies currently favor the sector’s net-zero transition, the sector needs to be better positioned to leverage these tailwinds and orchestrate the best way forward. One way of doing this is to join or form coalitions while moving at pace on investment and innovation.

Three ingredients could potentially accelerate the green transition in the built environment: transparency and awareness, partnerships along the value chain, and consistent and reliable metrics.

Transparency and awareness. It is critical to understand the possible pathways to decarbonization and what it will take to scale in a cost-effective way. Many design changes, green materials, and technologies are already cheaper today and increasingly available. For example, players could deploy traditional cost-reduction levers such as lowering demand for primary resources through design and process optimization (including reduced waste, improved building footprints, and limited overspecifications). Other levers include switching to low-carbon alternative materials and electrifying heavy equipment.
Partnerships along the value chain. Partnerships and mobilization are needed to realize the pathways to build and scale new materials and technologies in a cost-efficient and timely manner. According to McKinsey analysis, today, decarbonization is close to cost neutral for 50 percent of emissions (less than $100 per ton of CO₂), but for 20 percent it’s expensive (ranging from $175 to $500 per ton of CO₂) and technically challenging, including emissions from remaining material use, particularly cement and steel production fuels for heavy equipment (such as moving from liquefied natural gas to renewables). Actively improving collaborations and partnerships across the value chain in both cost-neutral and expensive options is critical to bring together all involved actors (from manufacturers, distributors, and developers to investors and construction companies).
Consistent and reliable metrics. Measuring sustainability effects and benefits using consistent metrics offers better points for comparison and enables competitive financing. It also allows companies to guide end consumers on choices. Companies should formulate their metrics without bias from interest groups. Standards and codes differ based on region, archetype, and even governing authority. It can be challenging and time-consuming to determine which standards, certifications, and rating programs are most credible and applicable to a particular project.

Acting on these three ingredients can provide unique opportunities to meet emissions targets and create future leaders in the built environment. In all major technology disruptions in the past, first movers have captured a disproportionate share of the market.

Launching the Net Zero Built Environment Council to help facilitate these changes

To help facilitate the critical elements for change, we are launching the Net Zero Built Environment Council, which brings together many of the leading incumbents and new scale-ups across the built-environment ecosystem. Along the lines of the three ingredients covered in this article, the council’s ambitions can help with the following actions:

Create transparency. Establish a fact-based perspective on a possible cost-effective recipe (translate the most powerful technology and other levers into a simplified playbook that applies to major building archetypes).
Raise awareness of what is doable. Remove perceived barriers to decarbonization, capture the interest of decision makers, and spur “positive pressure” and acceleration to act.
Stimulate partnerships and encourage initiative. Enable execution via innovative financial models, deployment of technologies, and scaling of efforts by bringing together stakeholders from across the built environment, whether by jointly commercializing technologies at scale or by identifying and creating lighthouse projects.

All contributors along the value chain must come together to overcome systematic challenges and increase transparency on cost-effective pathways to reach decarbonization goals and spread awareness to the entire sector. In this sense, the Net Zero Built Environment Council represents an important step forward in uniting industries and sectors—not only to achieve their climate ambitions but also to create green growth in the built environment.

Source: mckinsey

Accelerating capital projects to secure advantages in the net-zero transition

Anand Gupta — Thu, 03 Nov 2022 06:29:44 +0000

Ambitious net-zero deadlines require speedy project completion. Here’s how leaders of capital projects can strike a balance between the costs and benefits of accelerating delivery.

Moving toward net-zero emissions is an urgent priority for companies today, and it is creating a massive wave of projects driven by sustainability concerns. As we discuss in an earlier article, total capital spending will reach an estimated $130 trillion by 2050.1 The bulk of this amount will go into projects that aim to reduce the buildup of the greenhouse-gas (GHG) emissions that contribute to global warming and trigger climate change.

But good intentions alone won’t get the job done. The current capital project environment is largely unprepared to tackle the sheer size and scope of decarbonization and infrastructure construction projects. And time is running out to avert the worst impacts of climate change. The biggest challenge for senior leaders is getting sustainable assets into action fast enough. This involves limiting global warming to 1.5˚C above preindustrial levels, meaning that carbon dioxide (CO2) and other GHG emissions would need to decrease by 45 percent by 2030 and reach net zero by around 2050 and 2070, respectively.

First movers toward net zero can capture significant advantages—for example, they can gain better access to talent and financing, form partnerships to drive value from digital and renewable solutions, and enjoy increased support from investors and customers. But at today’s pace of project delivery, companies are typically not able to achieve net-zero targets on schedule. Frequent supply chain disruptions compound a growing scarcity of skilled labor, materials, and financing. The requirements of stakeholders such as governments, regulators, developers, and suppliers also need to be considered. In this environment, large capital ventures can take up to seven years to complete and suffer delays of two years or more; complex power-generation projects such as nuclear plants can take up to 15 years.

In this article, we discuss strategies for leaders to speed up infrastructure projects that need to be executed with sustainability in mind. Tactics such as standardizing design, using digital tools, reskilling appropriately, forming collaborative partnerships with stakeholders, and installing capital-expenditure-management systems can go a long way toward accelerating project delivery.

Sustainable projects face unique challenges

Speed in executing capital projects is of paramount importance to achieving sustainable-development goals. But costs have risen dramatically in the past two years. In particular, commodity prices are up 20 to 90 percent above prepandemic levels, driven by inflation and supply chain challenges.3 The global capital allocation required to meet decarbonization goals between now and 2050 would need to be about 60 percent greater than it is today, rising by $3.5 trillion annually on average. Many sectors will see a spending increase of 57 to 65 percent between 2022 and 2027 compared with the previous five-year period.

The unique needs of sustainability ventures also introduce considerations that don’t apply to traditional capital projects. Whether retrofits or new builds, sustainability projects often use new technologies that may be unproven or lack detailed design. Some types of infrastructure are highly interdependent on others, such that constructing one project requires carrying out others to support it. For example, building a hydrogen ecosystem in the transportation industry would require, at a minimum, retrofitters, refueling stations, and increased capacity for hydrogen production. In addition, the construction industry faces some capacity challenges. Faltering labor productivity growth (less than 1 percent a year over the past 20 years) and long time frames to obtain permits remain persistent problems (exhibit). Civil infrastructure and industrial and manufacturing plants are roughly at maximum capacity; many have experienced very little modernization in the past several years.

Exhibit

The most serious constraint may be the shortage of construction labor. For example, the United States will need about 168,000 construction laborers each year from now until 2030.4 Germany faces a serious labor shortage, with a net number of nearly two million open jobs.5 Even as the growth of new jobs outstrips the rate of new hires, a further complication arises: changing workforce skills and capabilities. Over the past decade, the median age of construction workers has risen, with more than one in five aged 55 and older—particularly problematic for an industry with an average retirement age of 61.6 The shortage of experienced people to train junior entrants can hurt an industry that relies heavily on on-the-job training and experience to acquire skills and capabilities. The net-zero workforce—the generation working to meet climate change goals—needs to be much larger, better skilled, and more productive than the workforce of today. This presents a significant opportunity for companies to upskill workers and drive equitable economic opportunities, as well as to use forward-contracting methods and to manage resources within partnership ecosystems.

Prioritize speed over cost

Historically, capital projects have typically prioritized cost over speed of delivery, unless the value of what is being delivered justifies an accelerated timeline. This is often the case for sustainable capital projects, where establishing new processes may cost more initially but will pay off in faster delivery and, potentially, better outcomes for project owners and investors. Companies and project developers may want to consider the following critical steps to shorten project timelines.

Rethink design and engineering

This step alone can raise productivity by 8 to 10 percent. Standardizing design enables rapid upskilling, uniform specifications, and lean construction that helps to reduce waste and improve efficiency. Sustainability projects that rely on less mature technologies may need unique specifications, but owners can make efforts early on to reduce overdesign and maximize the number of standardized or modularized components.

Shifting to modular construction can compress schedules by 20 to 50 percent, with the added benefit of improving delivery times. Modular and prefabricated construction for both residential and nonresidential building is having some impact in the European Union, as well as in Canada, Japan, South Korea, and the United States. However, even in the fastest-growing scenario, modular penetration is still below 10 percent, whereas in civil construction the penetration of prefabrication is expected to remain around 20 to 30 percent, as it is today.

The experience of an international mining company shows the efficacy of using design to accelerate project delivery. Moving to net zero relies heavily on the mining and metals sector to provide raw materials for sustainability projects. Speed in getting new projects online is even more important when producing the raw materials necessary for decarbonization projects, as these inputs drive the massive technological transition needed for sustainability. The mining company changed the design and execution of its first and second stages of front-end planning to shorten overall project duration. Using the minimum-technical-solution approach, the team reduced excavation volume significantly via a new tunnel cross-section and layout that shortened the overall construction time. It adjusted the construction methodology by using a mix of drill and blast mining and tunnel-boring machines to remove the first third of the tunnel’s length from the project’s critical path.

Reduce project variability

Our research has found that project complexity, data quality, execution capabilities, and mindsets are usually the root causes of project variability, or the extent of deviation from the plan. Improving the project production plan with advanced analytics and targeted optimization can improve the project schedule and cost performance by 30 to 50 percent.

A leading solar engineering company recognized that traditional schedule- and earned-value-based progress monitoring tools weren’t providing the granular and real-time insights that project leaders needed to manage projects such as manufacturing assembly lines. By adopting a suite of digital tools—including equipping crew leaders with tablets, geotagging key materials, and providing radio-frequency-identification tags for material tracking and workforce time keeping—the company set up the foundation for real-time information flow and data collection. A “control tower” was then implemented, integrating these insights into real-time dashboards that allowed for rapid decision making, surfacing of variability across sites and crews, and integration with project schedules and resource curves to anticipate future impact and simplify monthly reporting. Such transparency helps redirect efforts where they are most needed and boosts trust and cooperation, thus enhancing project productivity.

Deploy digital and analytical tools

Using digital analytics allows for real-time, data-driven decision making and can minimize wasted interactions when designing and delivering a project. For example, a collaborative digital platform could enable direct design editing, review, and approval across stakeholders, promoting real-time collaboration, reducing waiting time and defects, and improving onsite productivity.

Sustainability projects are often complex, involving many specialized trades and complicated systems integration. Traditional scheduling software could not provide the insights that a leading industrials player needed to create a high-quality resource-loaded schedule. The company introduced new digital tools that enabled generative scheduling, which could model the impact of various construction strategies (for example, build sequence, design choices, and access to the project management system). Before using this analytical approach, the company had considered adding structural overtime and more labor to the site, but the generative-scheduling model tested millions of options and discovered a counterintuitive approach that reduced cost and accelerated the schedule. These digital tools proved that by reallocating crews to nonobvious work areas and by completing the work in a different sequence, the project would end earlier and save valuable time to market in a competitive industry.

Promote collaborative partnerships

To promote speed of delivery, cooperation among stakeholders is essential. A collaborative partnership aims to maximize the expertise and alignment of all parties so that everyone is equally motivated to guarantee on-time delivery. There are six essential elements to most collaborative contracts:

a defined period prior to execution of the final agreement
a single contract that applies to all the delivery partners
shared risk and shared incentives among all parties
a no-fault clause whereby members forfeit rights to claims against one another
a joint management structure to govern the project
transparency and equal access to all costs and other project information

Establish an owner’s team capable of driving performance

Given their scale, complexity, and risk, sustainability projects can pose a unique challenge for owners. Even if all parties have a strong track record of on-time delivery, it helps to have a capable owner’s team that can stay focused on full-asset optimization and delivery, as well as anticipate and address issues, ensuring better project outcomes. Leaders should set up an appropriate organizational structure and governance to monitor and address risks and consider a regular and well-resourced cadence of reviews of key metrics such as commodity prices, skill availability, and other choke points in the ecosystem.

Develop a rigorous procurement and delivery model

To ensure that contract and procurement interventions both create value and streamline the speed of project delivery, organizations can design these interventions early in the project. We see five steps as critical:

Define a procurement operating model and governance anchored on the key goals of balancing value and environmental impact.
Create a contract packaging strategy tied to project delivery and launch proactive sourcing strategies to better identify and mitigate recent market challenges—for example:
- Introduce alternative suppliers to lower the risk of exposure to a limited range of suppliers.
- Connect spending to indexes where applicable.
- Aggregate spending to broaden the supply base.
- Negotiate based on “cleansheets” (calculations of the cost of each step during the creation of a product, component, or service) supported by data-driven market intelligence.
- Deploy labor contracting strategies to attract, train, and retain required labor in overheated labor markets.
Include a view on net emissions from the construction supply chain when selecting vendors (for example, the vendor’s supplier base, manufacturing emissions, transportation impact, or use of electric construction equipment).
Standardize and optimize procurement tools and processes to support market intelligence, vendor identification, request-for-documents processes, negotiations, contract management, emissions impact, and feedback for new sourcing strategies and projects.
Set specific cost and price benchmarks that are tailored to project conditions (for example, include inflation in project estimates) and allow for environmental impact to be considered.

Navigate an intricate maze of stakeholders

Today’s global stakeholder environment is incredibly complex and can cause major project delays if not managed properly. Stakeholders are vital to obtaining permits and licenses, making decisions, and providing approvals and sign-offs. It is essential for project developers to understand stakeholders’ agendas and concerns, assign a leader to manage the relationship, identify risks and guardrails, and set up a communication strategy. For example, one company identified some suppliers as critical to the project. The company hired former employees of those suppliers and charged them with building the suppliers’ trust and working with them to accelerate the manufacturing schedule.

For their part, governments and regulators—critical stakeholders—might consider the following actions to accelerate capital project completion:

Improve the efficiency and responsiveness of the permitting process. It can take months or even years to secure permits for construction. Governments can simplify the process by clearly defining requirements for applicants and by creating an efficient and user-friendly one-stop shop for permits. Some governments have made strides in this area: for example, the New South Wales government in Australia has developed a process to streamline complex project assessments to less than a year.⁷
Invest in education and professional training to reskill for net-zero jobs. In a decarbonized economy, jobs in resource-intensive sectors such as agriculture or oil and gas may decline. Governments can help ensure a smooth transition to sectors gaining jobs in the net-zero path by investing in reskilling.⁸ For example, in Singapore, a government-funded reskilling program enables all Singaporeans aged 25 and older to receive 500 Singapore dollars (about $356) a year; individuals can accumulate credits as the government provides periodic top-ups. In Louisville, Kentucky, a coalition of public and private organizations offers a 30-day upskilling program of free courses in areas such as data analytics, software engineering, and digital marketing, with a pathway for employment at local companies.
Support research and innovation. Governments may want to consider financing fundamental research and sharing research and innovation in open source. For example, the EnergyPlus software developed by the US Department of Energy is an open-source building-energy-modeling simulator that can help with building decarbonization and is used widely in the industry. Only a limited number of existing technologies can support the net-zero pathway, and substantial deployment of new technologies—such as long-duration energy storage—will take time because of the human and industrial capacity needed to achieve it.¹⁰ Governments should consider planning for this well in advance, as the market share of new technologies may later become limited.
Adapt and develop a fact-based regulatory framework. Cities have a key role to play in fighting climate change. Urban-planning strategy has an obvious impact on CO₂ emissions from mobility but also has the potential to address the urban heat island (UHI) effect by modifying albedo—the light reflected by a body or surface.¹¹ While all regulations need periodic review and updating, public regulators should consider providing visibility on upcoming changes so that developers with ongoing projects can anticipate the impact of revised regulations on capital project delivery.
Be an inspirational public buyer. Public-infrastructure contracts tend to favor the cheapest offer rather than the one with the best environmental impact. By adopting green public-procurement methods, governments can inspire private- and public-sector purchasers of products and services to do the same.¹² Although green public-procurement methods can be complex, they can contribute to a more sustainable marketplace, help communities thrive, and help to control some of the worst effects of climate change.¹³
Promote collaboration and standardization across countries. Given the extreme complexity of regulations on sustainability, regulators can benefit from joint standards among countries and regulatory regimes. For example, various governments in Europe are working on a joint regulatory review of France’s Nuward small-modular-reactor (SMR) design.¹⁴ The Nuward SMR is expected to replace old high-CO₂-emitting coal, oil, and gas plants around the world and support other applications such as hydrogen production and urban and district heating or desalination. The joint review would shift away from an individual project perspective to serial production in multiple countries and harmonization of SMR regulations. In another move toward standardization, the US government is proposing minimum standards and requirements for electric-vehicle charging infrastructure as part of a $5 billion government-funded initiative.

Capital projects have never been as much in the limelight as they are today. But market headwinds and other structural constraints have brought about steep increases in project costs, making it essential for companies to take a step back and review their options—especially because the performance markers will continue to be return on invested capital, even for new and unproven sustainability-driven ventures. At the same time, the timelines for project delivery have never been tighter. Winning organizations will be able to balance cost and speed without losing their focus on the ultimate objective: getting to net zero.

Low-carbon energy investment lagging in developed economies: study

Anand Gupta — Thu, 03 Nov 2022 06:15:05 +0000

NEW YORK: Investments in the low-carbon technology needed to reduce planet-warming emissions in emerging markets sank in the past four years even as financing jumped in developed economies, according to a study released on Tuesday.

Building more clean power generation sites in emerging economies to help wean them off fossil fuels will be high on the list of priorities for world leaders gathering in Egypt for a United Nations conference from Nov. 6.

These markets account for nearly half of the world’s greenhouse gas emissions, but less money is flowing into their low-carbon initiatives since the COVID-19 pandemic strained global supply chains and shrank project pipelines, BloombergNEF analysts said in the study.

Equity and debt financing for wind and solar plants, carbon capture and storage, electrified heat and transport, energy storage and hydrogen and nuclear globally reached a record high of $785 billion in 2021, almost a quarter above the previous year, BloombergNEF found.

But within that total, emerging economies saw investment slump 9% from a 2018 peak to just under $67 billion in 2021, while richer countries clocked a 53% increase.

Many global companies and governments have espoused a target to cut greenhouse gas emissions to net-zero – no more than can be absorbed back into natural sinks like forests or other technology – by 2050. That would require annual clean energy investment to reach $4.2 trillion in 2030, according to the International Energy Agency.

One of the curbs on investment in renewable energy in emerging markets in 2021 was a dearth of auctions for power delivery contracts, which have historically given vital incentives and security for developers in those countries. The lack of auctions could mean utility-scale clean energy projects are built slowly over the next few years, BloombergNEF said.

Source: reuters

Tetra Pak’s Latest Sustainability Report Highlights New Milestones – EQ Mag Pro

Anand Gupta — Wed, 02 Nov 2022 06:23:41 +0000

Tetra Pak published its Annual Sustainability Report highlighting the company’s global achievements and progress in the last year and details the actions to help realise resilient and sustainable food systems.

A special South Asia supplement released along with the report highlights the local initiatives taken to promote a low-carbon circular economy – ranging from helping customers reduce their emissions, to environment friendly practices adopted in the company’s own operations, as well as various partnerships undertaken to increase collection & recycling of used carton packages.

Global Highlights:

The impact of the pandemic and several global events have made a significant impact on the global logistics and raw material prices. However, as the world’s leading food processing and packaging solutions company Tetra Pak has worked towards reducing the impact of unprecedented disruptions around the global supply chain while leading the sustainability transformation within the industry.

Tetra Pak’s 23rd Sustainability Report highlights the company’s achievements and ongoing initiatives – to protect food, people and the planet. These include:

• Reduced operational GHG emissions by 36%[1], with 80% of energy coming from renewable sources, doubling the solar energy capacity to 5.55MW.

• Launched a pioneering land restoration initiative in Brazil, in collaboration with local NGO Apremavi in early 2022. The aim is to restore up to 7,000 hectares of land by 2030 for biodiversity recovery, carbon capture and climate change mitigation.

• Sold 17.6 billion plant-based packages[2] and 10.8 billion plant-based caps in the past year, enabling the saving of 96 kilo tonnes of CO2[3], compared to fossil-based plastic.

• Invested €40 million[4] to support the collection and recycling of 50 billion cartons, contributing to a circular economy.

• 61 million children in 41 countries received milk or other nutritious beverages in Tetra Pak packages through school feeding programmes.

• Successfully completed a commercial validation of a polymer-based barrier to replace the aluminium layer in aseptic cartons. Testing has started on a new fibre-based barrier – a first within food carton packages distributed under ambient conditions.

• Becoming the first carton packaging player in the food and beverage industry to launch a cap using attributed recycled polymers[5], in partnership with Elvir, a subsidiary of world leading milk processor SavenciaFromage& Dairy.

• Partnered with several innovative companies to transform potential food waste into sources of nutritious food, as well as developing alternative protein-based food applications. Along with the potential for a lower carbon footprint, alternative proteins offer scope for significantly reduced land and water use, compared with traditional sources[6].

• Committed to halve food waste, water consumption and carbon footprint of its best practice processing lines by 2030[7].

In addition, here are some highlights from Tetra Pak’s initiatives in India:

• Supported customers in reducing food waste, water consumption and carbon footprint through technological innovation and interventions

• Tetra Pak’s manufacturing site in Chakan (near Pune) was recertified as IGBC Platinum, meeting a range of parameters – Sustainable Site, Water Conservation, Energy Conservation, Innovation, Indoor environmental quality, material conservation and more)

• Collection & Recycling network for used cartons packages expanded to cover more cities across 26 states and Union Territories and 15 Army cantonments, supported by 4 recyclers across India

• Joined hands with Nestlé a+ to launch ‘Cartons 2 Classroom’ – an initiative to increase awareness about recycling by recycling used cartons to create classroom furniture for schools for less-privileged children

• Launched a unique program called Happy Wings in partnership with Eco Roots Foundation, an NGO working to conserve ecosystem, environment, and biodiversity

• This program aims to reach out to over 200 schools across the country, covering over 20,000 students to educate children about the importance of protecting biodiversity, while also teaching them how to make nests for birds using household waste like jute, coconut husk and recycled beverage cartons

• Tied up with micro-delivery start-up Milkbasket to help consumers recycle used carton packages from their doorstep through the Milkbasket app.

• ‘Alag Karo – Har Din Teen Bin’, a waste segregation awareness program in partnership with Coca Cola India, GiZ and Saahas since 2019 expanded to cover more wards in South Delhi and Gurugram showing strong impact

“Our ambition is to lead the sustainability transformation within our industry, and this is only possible through concrete actions across our value chain. We believe that it is imperative to leverage strong and system-wide partnerships, as collaboration is key to successfully overcome the challenges we face today. It is also critical to embed sustainability as a key business driver & decision-making criterion and promoting a culture of sustainability in our business and industry. As you will see in our latest sustainability report, we are making strong efforts in these areas,” said Ashutosh Manohar, Managing Director – Tetra Pak South Asia.

About Tetra Pak

Tetra Pak is a world leading food processing and packaging solutions company. Working closely with our customers and suppliers, we provide safe, innovative and environmentally sound products that each day meet the needs of hundreds of millions of people in more than 160 countries. With more than 25,000 employees around the world, we believe in responsible industry leadership and a sustainable approach to business.

Our promise, “PROTECTS WHAT’S GOOD”, reflects our vision to commit to making food safe and available, everywhere.