In a journey towards sustainability, addressing the greenhouse gas (GHG) emissions has become a priority for industries. The emissions created by industries are categorized into three scopes. Scope 1 emissions refer to the direct GHG emissions from an industry. It can be from any sources owned or controlled by a company, ranging from air conditioners to fuel combustion. Scope 1 emissions directly impact the organization’s carbon footprint and also negatively contribute to the global carbon emissions.
To manage the greenhouse gas emissions of an industry, it is essential to understand the role of value chain dynamics in scope 1 emissions. Emissions can take place in various stages of production; in order to reduce the direct greenhouse gas emissions, it is important to adopt reduction technologies. In this blog, we discuss how companies can mitigate scope 1 emissions through value chain insights and technologies.
Scope 1 emissions:
Scope 1 emissions are the direct greenhouse gas (GHS) emissions due to the activities controlled or owned by an organization. The emissions take place as a result of combustion of fuels, heating and cooling processes using fossil fuels, transportation and other such industrial processes. Scope 1 emissions are generated from an organization’s most basic and core operational methods.
Impact of Scope 1 emissions on the value chain:
The value chain of a company is, the series of activities a business undergoes, to manufacture and deliver a product or service to the customer. Scope 1 emissions take place from production till distribution, in every single step of the value chain.
- Production: Manufacturing processes often rely on fossil fuel; it can also involve chemical reactions that emit greenhouse gases into the atmosphere.
- Logistics and transportation: The company will be owning or hiring vehicles for transportation of raw materials, products or employees as well. The majority of vehicles run on fossil fuels and thereby contributes to scope 1 emissions.
- Operations and maintenance: The operation of machinery and equipment, heating and cooling systems working on non-renewable energy sources as well as air conditioners, can emit carbon dioxide into the atmosphere.
Key challenges in reducing scope 1 emissions:
- Data and accuracy: To maintain and oversee the scope 1 emissions of an industry, it is essential to have proper data on emissions that can be analyzed and used to frame necessary steps. Companies often fail to gather accurate data, which reflects poorly in the further steps of carbon dioxide emission reduction.
- Cost: To switch from non-renewable energy sources to green energy in order to reduce the carbon dioxide emissions is advisable. But the execution of this step is costly and cannot be done in a switch. While reducing scope 1 emissions can lead to long term cost savings, initially the steps will be challenging due to financial constraints.
- Technology and infrastructure limitations: Several industries find it difficult to find the best alternatives for the fossil fuels, as they require a large amount of fuel as efficient as the ones they are using. Steps like carbon capture and storage (CCS), through which the carbon dioxide is captured and stored without releasing it is highly efficient, but it might not be feasible for all businesses. Not all companies can afford such cutting-edge technologies to reduce carbon emissions.
Reduction technologies for scope 1 emissions:
To effectively reduce scope 1 emissions, industries can adapt a range of technologies and strategies. These steps will help you minimize direct greenhouse gas (GHG) emissions from the value chain and make it sustainability oriented.
- Energy efficiency improvements: Switching to energy-efficient machinery and processes can cut down fossil fuel consumption. Invest in energy efficient technology, which will reduce carbon dioxide emissions without compromising on quality. Upgrading equipment, proper maintenance, HVAC systems and so on helps in reducing scope 1 emissions.
- Renewable energy: Making use of renewable energy sources rather than fossil fuels will reduce greenhouse gas emissions exponentially. Installing solar panels, using concentrated solar power (CSP) and electric or compressed natural gas (CNG) vehicles can contribute to reducing carbon dioxide emissions.
- Carbon Capture and Storage (CCS): Using this technology, the carbon emissions can be captured before being released into the atmosphere and stored underground. The captured carbon dioxide can also be repurposed for other industrial applications.
- Process Optimization: Implementing lean manufacturing methods will allow you to prevent overproduction and thereby reducing emissions and improving quality. Improving maintenance, proper planning and execution of production, waste and emission management, and waste repurposing also cuts the greenhouse gas emissions.
- Green culture: Promoting sustainable practices can help an organization reduce its scope 1 emissions. Fostering a culture of sustainability, providing and promoting sustainable practices can contribute to energy conservation and reduce greenhouse gas emissions.
Benefits of reducing Scope 1 emissions:
- Cost cutting: Replacing fossil fuels with biogas, reusing and upcycling waste, and shifting to renewable energy sources like solar or wind can significantly reduce operational costs. In India, a unit of electricity for commercial use costs between 10 and 20 rupees, and the amount of electricity consumed by industries varies according to production and plant size. By switching to green energy sources, this expenditure can be reduced.
- Energy efficiency: Installing automated HVAC systems can minimize energy wastage, ensuring power usage only when it is necessary. Equipped with smart sensors, programmable controls, and many more technologies, optimal conditions can be maintained with accuracy and zero wastage. This will reduce fugitive emissions, the unintentional leaks or release of greenhouse gases from air conditioners, refrigerators and fire suppression systems.
- Biofuel and waste management: The waste produced by industries can be reused and upcycled, helping to reduce the overall waste generated. The biowaste can be used to produce biofuel which is a green alternative for the fossil fuels. This will lower the need for fossil fuel, reduce environmental impact, and also contribute to financial savings.
- Reduced carbon footprint: Controlling the Scope 1 emissions can largely contribute to the global efforts to combat climate change. Lowering greenhouse gas emissions is a step towards achieving sustainability goals benefiting both the environment and the industry.
- Reputation: An industry working on the principles of sustainability and taking measures to prevent emissions and shifting to renewable energy sources increases its reputation among customers.
The Role of Government Regulations and Policies:
- Subsidies: The Indian government’s, Ministry of New & Renewable Energy provides various subsidies for renewable energy through schemes such as, National Solar Mission, and the rooftop solar program. The National Solar Mission aims to promote the use of solar energy in industries and other sectors. The industries will receive financial incentives to install solar panels and up to 30% capital subsidy on rooftop solar installations.
- Renewable energy certificates (REC): Industries that generate renewable energy can trade REC in energy exchange. This helps industries to monetize excess renewable energy production and promote others to switch to it.
- Tax incentives: Up to 40% depreciation can be claimed by industries on renewable energy investments. This will reduce the financial burden on industries investing in renewable energy and make the projects affordable.
- Perform, achieve and trade (PAT) scheme: Industries that surpass their energy savings targets can earn Energy Saving Certificates (ESCerts), which can be traded on the market to industries struggling to meet their targets. The objective is to improve energy efficiency in energy-intensive sectors through market-based mechanisms.
- National Clean Energy Fund (NCEF): Grants funds to research, development and commercialization of renewable energy sources for industries. It provides financial aid to the industries to scale up their renewable energy projects.
Conclusion
Mitigation scope 1 emissions is a need of the hour. By following scientifically crafted green methods, the industries can thrive while minimizing environmental impact. It is crucial to reduce the carbon footprint for global good. Hedge 5 helps you to meet this need. We analyze the value chain and design tailored solutions to reduce scope 1 emissions, thereby taking your company a step towards sustainability.