L&T committed on integrating ESG goals with business targets: CEO & MD S N Subrahmanyan

To be a net-zero company, Larsen & Toubro (L&T), is working on a four-pronged strategy on clean energy consumption. This effectively means that the company will generate as much renewable energy as it consumes from electricity it buys and consumes by year 2035. Let's take a closer look at what this strategy entails.

Towards the end of October 2021, L&T released the Company’s fourth integrated report, ‘Sustainable Progress for a Better World’. The report communicates the organisation’s strategy, governance, performance and prospects in the context of the external environment and value creation. L&T also declared to achieve carbon neutrality by 2040 and water neutrality by 2035.

For years, the Company’s thrust was always on ESG (environment, social and governance) parameters such as climate stewardship, circular economy, green offerings, green supply chain, employee and social welfare, workforce health and safety. As in previous years, the future too would see renewed efforts to protect and sustain the environment.

L&T’s target is to improve energy efficiency across all its equipment by 2 to 2.5 per cent per year depending on their type and energy source. This will be achieved through better processes, use of digital technologies for equipment productivity and replacement of older machines with newer, more efficient ones.

“L&T is committed to integrating ESG goals with business targets. L&T has decided on a four-pronged carbon neutrality approach which involves improving energy efficiency, increasing the share of using eco-friendly fuels, spiking up the use of renewables and offsetting the remaining greenhouse gas emissions by planting trees,” L&T CEO & MD Mr S N Subrahmanyan, who is leading this race to be green, said.

In many ways, L&T is already on this journey. Over the last few years, the Company has digitally connected over 11,000 pieces of equipment across more than 600 construction sites. This has led to real-time tracking of equipment performance and related decisions, resulting in improvement in equipment utilisation, high efficiency and lower energy consumption.

Secondly, L&T targets using eco-friendly fuels at least 5 per cent of direct fuel consumption by 2026 and 100 per cent by 2045. Some of the renewable fuels/technology options are battery electric vehicles (BEVs), biogas, renewable diesel, green hydrogen, stationary fuel cells, fuel cell electric vehicles (FCEVs) etc. The application areas include forklifts, cranes, furnaces, off-grid power, batching plants, backup power etc.

Thirdly, L&T currently sources 10 per cent of its electricity through renewables, essentially solar. The Company aims to increase this to 50 per cent by 2026 and 100 percent by 2035. This should be possible with advancements in battery and RE power storage technologies in the next five years or so.

In the longer term, L&T will explore if it can transport and use green hydrogen at its project sites when it becomes technologically and commercially viable.

It is expected that improvement in energy efficiency will reduce emissions by 35 percent by 2035, the use of renewables will abate emissions by 55 per cent and the balance 10 per cent will be offset through tree plantation.

L&T also aims to plant 1 million trees every year for CO2 offsetting. This will constitute about 10 per cent of total decarbonisation options. The company has till now planted 3.3 million trees and created urban forests at six locations. The other offset options beings considered are bioenergy with carbon capture and storage (BECCS).

Some of L&T’s recent successes in decarbonisation includes:

1. Reduction of GHG emission intensity by 4.5 per cent in FY21 in comparison to FY16.

2. Renewable energy as a percentage of total energy stood at 10 per cent in FY21, which was 5 per cent in FY16.

3. L&T campuses utilised 21.2 million units from wind-powered turbines through wheeling.

4. In FY21, 2.6 million units of solar energy was harnessed at L&T’s campuses.

5. Through concerted efforts, 35,000 tonne CO2 emission avoided during FY21.

6. As much as 128 million Kwh energy has been saved since 2008, which translates to 108,000 MT CO2e or powering 60,000 homes per annum.

Larsen & Toubro is using technology, innovation and adopting best – in – class practices in the race to become a net-zero company. The company has always valued the importance of leaving a better world for future generation and will continue to work towards this goal.

You can learn more at: https://www.lntsustainability.com/

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