September 2021: UltraTech Cement is committed to contribute to mitigation of climate change through a holistic approach of decarbonising its operations. Cement is a carbon-intensive industry and our efforts in the manufacture of cement across our units ingrain our approach to carbon reduction.
UltraTech has 22 integrated cement manufacturing units, 27 grinding units and one clinkerisation unit. Each of these units have implemented various initiatives such as digitalisation, alternative fuel & materials usage, and adoption of renewable energy sources to decarbonise their operations.
We have identified energy conservation and transition to green energy sources as initiatives to ensure lower emissions. Early results of these efforts are visible at two of our grinding units- Arakkonam Cement Works in Tamil Nadu and Ginigera Cement Works in Karnataka. Arakkonam Cement Works and Ginigera Cement Works have been operating entirely on renewable energy for a period of six months and two months respectively. This has led to a reduction of 16500+ tons of carbon emission at Arakkonam Cement Works and another 23000+ tons at Ginigera Cement Works. Efforts are underway to operate these plants on 100 per cent renewable energy throughout the year.
Co-processing, which refers to incinerating waste in cement kilns, also allows cement companies a huge opportunity to reduce use of fossil fuels. UltraTech was one of the early adopters of the alternative fuel technology. At present, the Company is supporting 80 municipal corporations across India by helping them reduce the waste headed for landfills. In FY21, over three per cent of the Company's fuel requirements was met by using alternative fuels. The share is higher for some of our units such as our Tamil Nadu based integrated unit Reddipalayam Cement Works. About 25 per cent of the unit's fuel (heat) requirement is being met through utilisation of waste materials sourced from local municipal corporations and industries. With the increased usage of alternative fuels through co-processing, Reddipalayam Cement Works is now 16.25 times plastic positive. The unit has also successfully reduced CO2 emission by 2,250 tonne CO2 per annum.
UltraTech sees digitalization as a key driver of sustainability and has been an early adopter of digital technology across its business processes, including manufacturing and logistics. The digital transformation of business processes has the potential to decouple emissions and resource use from economic growth as well as make operations more sustainable, safer and reliable.
Our integrated unit Dalla Cement Works, in Sonebhadra district, Uttar Pradesh, is one such unit that has adopted digitalisation to reduce carbon emissions. Dalla Cement Works has successfully incubated a technology based on a digitalization platform. The solution leverages Artificial Intelligence based Activity Wireless sensors and GPS for real-time monitoring of mines' material handling equipment. This solution provides operational insights which help to monitor and improve the efficiency of mining equipment. This has helped us in achieving fuel saving of 1.90 lakh litres of diesel per annum for a fleet size of 60, thus helping us reduce our carbon footprint in the mining operations.
UltraTech has implemented Internal Carbon Price (ICP) of USD 10/ tCO2e (Tonnes of carbon dioxide equivalent) for all its businesses. This is a huge step towards achieving our carbon emissions reduction goals, as this carbon price is being used as a decision-making tool to identify low carbon projects at our units. In FY21, UltraTech took an important step to further institutionalise its carbon reduction initiatives with the validation of its GHG emission reduction targets by Science Based Targets Initiative (SBTi).
UltraTech believes that adoption of green business practices needs to be combined with sustainability linked targets and commitments. In FY21, the company did just that through an issuance of sustainability linked US dollar bonds, a first for India and second in Asia. These bonds stand testimony to UltraTech's long-term commitment to decarbonise its business operations.