Policy | How NREP can help industry become more resource efficient

Shilpi Kapur Bakshi and Prahlad Kumar Tewari

India’s rapid economic growth over the last two decades has been accompanied by over-exploitation of natural resources and environmental degradation, which, in the long run, threatens human existence itself. However, that need not be the case for future economic development too.

The National Resource Efficiency Policy (NREP) envisions a future with environmentally-sustainable and equitable economic growth, resource security, healthy environment, and restored ecosystems. The principles of the draft NREP include “creating higher value with less material through resource efficient and circular approaches and creation of employment opportunities and business models beneficial to the cause of environment protection and restoration”. If adopted, these principles will enable Indian industry to reduce costs, increase productivity, and foster sustainable industrial growth.

The NREP also emphasises on the role of a lifecycle approach in designing resource efficiency interventions along all stages of a product’s life — from raw material extraction, material processing, product manufacturing, to use and maintenance, and disposal or recycling. This will help industries integrate the complete environmental and economic impact of their products or services and the associated supply chain, providing opportunities to innovate and increase competitiveness in local and global markets.

For example, adoption of the Resource Efficiency & Cleaner Production (RECP) strategy is an important step to ensure optimised consumption of resources such as energy, water, and raw material while leaving behind a reduced environmental footprint. The RECP allows industries to reduce their resource consumption and waste generation for the same product output, leading to both financial and resource savings.

The NREP also identifies producer responsibility across lifecycle stages. Reducing the pressure on virgin resource extraction and sourcing secondary raw material or renewable material could be the starting point.

Availability of secondary raw material can be made possible through formulation and implementation of end-of-life management policies across industrial sectors. Implementing Extended Producer Responsibility (EPR) for management of end-of-life products can help collect and channel secondary resource (waste) back into the production cycle, providing different opportunities for reuse. Creation of waste exchange platforms that link one industry’s resource demand with another’s waste streams will facilitate the industrial symbiosis that substitutes virgin material with secondary raw material.

Eco-designing of products also plays an important role. It not only allows use of recycled raw material but also includes aspects of ease of recycling and disassembly to ensure its extended value and lifetime in the economy.

The process stages should adopt the RECP as it will help avoid increased depletion of already scarce natural resources and reduce greenhouse gas (GHG) emissions. In 2016, resource efficiency activities in an auto component cluster in Pune successfully demonstrated this approach. A cluster of five press-part component manufacturers was formed to gainfully utilise their off-cuts and scrap within this ecosystem. The RECP initiatives here resulted in electricity reduction of 249,240 kWh, which calculates to about 200 tonnes of CO₂ reduction per annum. About 32,000 litres of water per annum was saved by preventing leakages and reusing reverse osmosis (RO) rejects.

As a part of circularity initiatives, material was saved through both internal recycling/reuse of the generated off-cuts within a unit’s processes and external recycling through business-to-business engagement, which led to sale of off-cuts and scrap to other press-part units within the cluster. This resulted in potential saving of around 87 tonnes of raw material. This kind of symbiosis also promotes local and regional growth that is characterised by a cluster of firms engaged in resource efficiency practices.

Partnerships and tie-ups to provide repair, upgrade, and refurbishment and maintenance services have the potential to create skill-based employment opportunities for the informal sector and facilitate their integration with the formal sector.

Further, using performance metrics can help promote the uptake of resource efficiency measures by providing a tool to measure, monitor, and compare performance. Industry associations can provide a platform for dissemination of good practices through improving value chain relations, and also enhance industrial symbiosis. Creating awareness and building capacity in dematerialisation and remanufacturing is also extremely important.

Research, development, and innovation led by the industry and supported by appropriate business models can help in introducing new alternative materials in production, making new products from waste and rendering both the input material and product more sustainable.

Industry has a major role to play in the successful implementation of the NREP, starting from sustainable sourcing of raw material to end-of-life recovery of secondary raw material. In exercising this role, it also has the chance to tap many opportunities and generate not just environmental benefits, but also reap economic gains and improved social outcomes.

Shilpi Kapur Bakshi, Senior Fellow and Prahlad Tewari, Fellow and Area Convener, Resource Efficient Technologies at The Energy and Resources Institute (TERI). Views are personal.