India’s industrial sector is critical to the economy, especially concerning employment and GDP contribution. Nevertheless, it is a leading energy user as well, accounting for nearly 49.5% of India’s total final energy consumption in 2023-24. This energy demand is an urgent call for decarbonization strategies throughout these industries that are globally, socially, and economically sustainable. Further, integrating not only a strategy but also real-time Environmental, Social, and Governance (ESG) monitoring sets forth a strong business case for the industry to lower associated costs from carbon emissions while delivering operational efficiency improvements.
The imperative for industrial decarbonization
The consumption of energy in India has been on the rise over the last decade, with total final energy consumption increasing from 414 million tonnes of oil equivalent (Mtoe) in 2013-14 to 597 Mtoe in 2023-24. The industrial sector has taken a leading position in this consumption and is an important facet of the energy landscape of India. The industries with the largest energy consumption include iron and steel, cement, fertilizers, and aluminum. High energy consumption has significant implications for greenhouse gas emissions, as well as concurrently exposing industry to the unpredictability of energy prices and the supply chain.
Decarbonizing industrial energy use is both an environmental necessity and a business strategy. Decarbonization typically involves energy-efficient technology, using renewable sources as opposed to fossil fuels, and process optimization aimed at reducing emissions. These activities can yield cost savings, a competitive advantage, and compliance with new regulations.
The role of real-time ESG monitoring
Real-time ESG monitoring employs state-of-the-art technology, including the Internet of Things (IoT), data analytics, and artificial intelligence, in order to provide continuous visibility into an organization’s environment, social, and governance performance. For energy use in industries, real-time monitoring offers a range of advantages:
- Enhanced data accuracy and transparency: Real-time monitoring will provide accurate and up-to-date data on energy consumption and emissions. This transparency builds trust with stakeholders, including investors, regulators, and customers, increasingly prioritizing sustainability.
- Proactive risk management: Real-time data enables early detection of inefficiencies or anomalies in energy use, allowing for swift corrective actions. This proactive approach minimizes operational risks and potential regulatory non-compliance.
- Operational efficiency and cost reduction: By locating energy inefficiencies, companies can focus on solutions for optimizing processes, leading to real cost savings. Real-time monitoring can identify areas for waste elimination and improve the use of resources.
- Strategic decision-making: Having access to real-time data for ESG topics helps companies make informed decisions that align their operations with sustainable objectives and the demands of the market. Being aligned with sustainability topics can grow a company’s brand reputation and allow for new business.
- Challenges and considerations
While the benefits are substantial, implementing real-time ESG monitoring in industrial settings presents several challenges:
- Initial investment: Investment in sophisticated monitoring processes may impose a capital expense that could be a barrier for a business less than the size of a small or medium-sized enterprise.
- Data integration: Consolidating data from diverse sources and ensuring interoperability between legacy systems and new technologies can be complex.
- Skilled workforce: To be effective in real-time, human applications of data must employ human labor who are skilled in data analysis and review.
Decarbonizing energy use in industry is a core part of India’s sustainable development agenda. Real-time ESG monitoring is a powerful approach to achieve this goal, with advantages that go beyond environmental compliance to operational excellence and competitive advantage. By embracing real-time monitoring, India can begin to have a leadership position on sustainability in a world where sustainability is now in the vernacular of business. For resilient and long-term profitable business survival in an increasingly sustainable world, Indian industries must intervene with non-carbon energy options.
The views and opinions expressed in this article are the author’s own, and do not necessarily reflect those held by pv magazine.
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