The MSME sector is a key part of India's economy, contributing to the country's GDP, exports, employment, and as well as to increasing Carbon emissions. The number of MSMEs in India is expected to grow from 6.3 crore to ~ 7.5 crore in the coming years. According to a study by CSTEP, implementing a combination of energy efficiency measures and renewable energy solutions could lead to an annual savings of Rs. 370 million in energy costs.
In today's evolving business landscape, Carbon emissions management is no longer just about corporate responsibility, it’s about operational efficiency and cost savings, especially for MSMEs.
This exercise could be intimidating to many MSMEs unless broken down into simpler actionable steps for unlocking bigger benefits as briefed below:
Following 5 reasons why MSME manufacturing industries should implement Carbon emissions management strategies:
- New regulations at the Indian market and at the Global level are putting pressure on businesses of all sizes to meet emissions targets.
- Consumers and large corporations (OEMs) are increasingly prioritizing sustainable suppliers and partners. MSMEs with carbon baseline & decarbonization plans win new businesses from larger corporations that are looking for sustainable suppliers.
- Managing Carbon emissions leads to Process optimization monitoring which reveals inefficiencies in the production process, thereby improving the overall productivity.
- MSMEs involved in manufacturing & product distribution can improve their supply chain management by tracking emissions related to transportation and logistics
- As governments ramp up their efforts to curb carbon emissions for the 2035 NDC goals, MSMEs can tap into green financing programs, subsidies, and tax benefits for adopting sustainable practices.
- MSMEs that demonstrate active efforts in managing their emissions can strengthen their brand reputation, attract environmentally-conscious customers, and convert business risks into new opportunities.
- Resource optimization & Energy Efficiency improvements through our robust 3-step process, can reduce operational expenses.
How to Get Started?
Implementing an emissions management strategy does not always have to be costly or complicated. Here’s how MSMEs can get started:
- Understand where the most carbon emissions come from within your business through baselining exercises coupled with performance audits.
- Knowing the emission Hotspots, establish clear, measurable goals for reducing emissions.
- Start with the low-hanging fruits, such as switching to energy-efficient systems, retrofits, and optimizing machine usage.
- Integrate production processes or ancillary projects with renewable energy sources which require investments in terms of money, time & effort.
- Frequently monitor the retrofits, and system upgrades made to track carbon emissions & energy usage for continuous improvement
- For managing emissions associated with the supply chain, start with the highest contributing supplier to your emissions baseline and gradually implement changes to the whole of the supply chain process.
- Realizing all the above benefits is not wholesome if it is not communicated in the right format with the right data as part of disclosures.
This article was written by Swasthi Krithivasan, Head of Decarbonization & ESG at Conserve Consultants Pvt. Ltd.
