Logistics and supply chain as an industry entails multiple modes of transport, which makes sustainability and carbon-neutrality a critical need for this segment. The emergence of alternative fuels now stands as a torrent of opportunities for the sector to tap on, as it seeks to stand up to the global call for sustainability. Alternative Fuels are taking the logistics industry by storm, from biodiesel, electric fuel, ethanol, hydrogen, methanol, natural gas
(CNG/LNG), propane (LPG), DME, P-series and solar fuels. We explore the rise of alternative fuels and technologies and how the future looks green for this rising sector.
SUSTAINABLE FUELS FOR AN EMISSION–FREE LOGISTICS FUTURE
Sustainable fuels are expected to play a critical role over the next 10 to 20 years in efforts to cut down the consequences that transport has on the climate. Climate-neutral logistics is now an imminent future and efforts are on to leverage this opportunity, especially for the logistics and supply chain sector.
The emergence of carbon-neutral fuels has come at a time when the need for sustainability is pronounced and strongly felt across industries, and fortunately today, we have a variety of potentially sustainable fuels that now exist. From well-known alternatives like biofuels and hydrogen to lesser-known options like synthetic fuels, each alternative fuel comes with its own set of advantages and limitations. There is not a particular choice that has surfaced as the obvious alternative, but regardless, it is all about generating momentum for continued development of sustainable fuels.
To achieve the vision for a climate-neutral future, intelligent strategy, requisite infrastructure and bundling expertise will play a paramount role. Creating a more sustainable economy is only possible if we join forces and follow the right strategy, and logistics plays a critical role in this.
IS INDIA’S LOGISTICS SECTOR ON THE RIGHT TRACK WITH RESPECT TO EMBRACING GREEN ENERGY SOURCES?
“Yes, it is on the right track and waiting to explode”, shares Balachandran M, Chief Technical Officer, Seros Logistics.
“All operators want an efficient and a very sophisticated vehicle with optimum utilisation and minimum OPEX. Green energy sources will provide them the leverage to tap deeper into the sector. India as a whole will reap the benefit of Green Energy. Statutory hurdles needs to be cleared for an early realisation of the benefits.”
~ Balachandran M, Chief Technical Officer, Seros Logistics
One of the major challenges brought forward by the transition to renewable energy is finding a needs-based way to conserve green electricity which relies on sun and wind. When it comes to Electric Vehicles, in India, while the growth in the EV industry is going up, it has much ground to cover to be able to realise the government’s ambitious 2030 target.
Until the transport industry reaches the point where it can become fully electric, there is amassive requirement for other solutions to reduce greenhouse gas emissions. Particularly in air transport, state-of-the-art, low-emission and fuel-efficient freight aircraft can make only a small contribution to lowering emissions. This has given rise to the development and improvement of sustainable fuels like biofuels and e-fuels.
BIODIESEL
Biodiesel is a domestically produced, renewable fuel that can be manufactured from vegetable oils, animal fats, or recycled restaurant grease for use in diesel vehicles or any equipment that operates on diesel fuel. Biodiesel’s physical properties are similar to those of petroleum diesel. Biodiesel transportation uses clean-burning alternative fuel produced from domestic and renewable resources.
While talking about Biodiesel, Umesh Madhyan, VP – Supply Chain, Hindustan Coca Cola Beverages and President,
CVSCL shares, ”There are 27-29 biodiesel suppliers right now available in India, available across states, as per a research”.
“We have started incorporating biodiesel into our HCCB-owned trucks since the past 18 months now, and so far, there has absolutely been no problem. We are replicating big time, and we are working very closely with the people to build capacity and ensure we migrate. We have migrated in Andhra and Telangana already, the next plan is to migrate from Gujarat, Karnataka etc and we move on gradually.”
~ Umesh Madhyan, VP – Supply Chain, Hindustan Coca Cola Beverages and President,
CVSCL
Sushil Vaishnav, Operation Director, KNP Arises Green Energy shares, “At KNP,we are creating a marketplace where we enable companies to reduce their energy consumption. It is all about having a tech-enabled reverse logistics system.”
“In India, there is a huge demand for biodiesel. On an average, it is 20-30% cheaper than regular fossil fuels. The government is keen on meeting global sustainability targets. The demand and supply exists but every state government is putting a lot of efforts and pilot plants are coming up. Yes, the product is available and they can easily switch.”
Mr Vaishnav offers his advice on going for the right partner to migrate to biodiesel. “My suggestion would be: It is advisable to go and check out the biodiesel plant, instead of trusting the traders at face value. Enquire about the raw material that is being used to ward off possibilities of adulteration, as sometimes. The biodiesel price that is quoted is even cheaper than the cost of raw materials, which reeks of foul play”.
“Most importantly, one should always ask for BIS certificate given by the Government of India for verification”, he adds.
With a growing number of shipping companies in different parts of the industry continuing to experiment with the use of biofuels as a near term means of improving the environmental performance of their operations, can India witness a similar rise in the adoption of biofuel?
“In India, biofuel availability is low because companies consider it as source of cost saving tool not as a responsibility towards society. Because of this mind-set, the right price is not being offered to biofuel, thus not enough companies are investing in this sector.”
~ Sushil Vaishnav, Operation Director, KNP Arises Green Energy
ENERGY MANAGEMENT SYSTEMS
Energy Management solutions enable users to quickly identify utility waste and help them reduce their consumption. It ensures cost savings in addition to ensuring optimal utilisation of resources.
According to Allied Market Research, the energy management systems market in the Asia-Pacific
region is anticipated to exhibit growth at a CAGR of 17.9% during the forecast period (2017-2023).
With respect to India, the low awareness of energy efficiency solutions among SME players
has resulted in low market penetration for the EMS products and services. Consequently, for
the market players in India, there exists a myriad of opportunities for consulting and training, as
a result of which, the segment is expected to witness a strong CAGR growth of 15.6% from
2017 to 2023.
Mr Madhyan while talking about EMS, shares the advances made by Hindustan Coca Cola Beverages in this regard.
“We are working with Schneider in Mumbai, where they are helping us ensure that we consume and distribute energy to the different energy consuming parts of the factory in a way that is more economical, sustainable and helps in reducing our energy consumption. These are ideas which, at one point of time, seemed expensive and unaffordable, but this solution comes at less than one year payback, so it is a remarkable way to ensure that we reduce our footprint in terms of energy consumption”.
INCORPORATING BEST PRACTICES FOR REDUCED ENERGY CONSUMPTION:
Shaik Asad Parwez, GM – Supply Chain, V Guard Industries shares how the company has incorporated practices ensuring safe disposal of batteries.
“We have a very good system for battery disposal. If you do not dispose acid lead battery properly, it has a drastic impact on the entire nervous system of a human body, once it makes its way through the food chain”, he explains.
“Battery disposal is a very critical issue, as usually the acid is disposed of in the garbage where it lands up in the river and then enters into our food chain. As a leading producer of batteries, we have taken this as an opportunity and have entered into an agreement to make it a biodegradable process with minimum wastage.”
~ Shaik Asad Parwez, GM – Supply Chain, V Guard Industries
HYDROGEN FUELS FOR THE LOGISTICS INDUSTRY
A clean and reliable alternative, Hydrogen fuel can be seen as the next best option for a climate neutral future in lieu of EVs.
From the manufacturing warehouse to the last mile, hydrogen fuels have now become a
focal point in the logistics scene. It is globally acknowledged as a cost-efficient and effective choice that can serve as a solution to the environmental problems that confront us today. The benefits and emergence of Hydrogen Fuel are reassuring — with high octane ratings, energy content and most importantly, a large base source for production. Countries like the US, Japan, Germany and China have already deployed hydrogen-fuelled cars and buses in their respective countries. Recently, leading aircraft manufacturer Airbus shared its new concept of zero emission commercial aircraft. Powered by hydrogen, it would rely on hydrogen as the fuel as its combustion produces only water vapour.
This makes it a clean fuel option for other commercial heavy transportation vehicles like trucks, trains
and planes in the near future. It is expected to foray into the market by 2035.
Even our country’s Ministry of Road Transport and Highways notified amendments to the Central
Motor Vehicles Rules, 2020 where it prescribed standards for safety evaluation of the vehicles
propelled by hydrogen fuel cells. This means, the suppliers and manufacturers of such hydrogen
fuel cells vehicles now have standards available to test the vehicles, which are at par with the
international standards. The MoRTH has also issued specifications for Hydrogen Enriched Compressed Natural Gas
(H-CNG) for use of 18% mix of hydrogen for automotive purposes as per the Bureau of Indian
Standards.
The goal is to sensitise the adoption of such eco-friendly and energy-efficient
hydrogen fuel-cell vehicles and H-CNG. At present, the production of hydrogen fuel
from fossil fuels is way cheaper than renewable energy and the cost of production and transport
of hydrogen fuel to stations is correspondingly high. Thereby, it is imperative that hydrogen gas
storage and refuelling infrastructure is set up on large scale.
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