Skoda Volkswagen aims for carbon neutral car production in India by 2025

Mumbai: While electric vehicle sales are yet to take off in a meaningful way, the world’s largest carmaker Volkswagen Group is looking to make its factories carbon neutral in India in a bid to curb emissions and rein in climate change.

Globally, the Volkswagen Group wants to make manufacturing carbon neutral by 2030. But its Indian arm has set the target of making both the domestic manufacturing plants carbon neutral by 2025 by investing in solar and wind energy, Gurpratap Boparai, managing director of Skoda Auto Volkswagen India (SAVWI), told ET.

“We need to make the entire value channel carbon-neutral or have carbon-fixing projects that compensate for whatever carbon we generate,” Boparai said.

Presently, the company claims to save almost 10,000 tons of carbon emissions annually at its Pune and Aurangabad plants by employing rooftop solar panels – the equivalent of over 5000 electric vehicles (EVs), it said. About 30% of the company’s electricity requirement at its manufacturing plants is being met through solar energy, which it aims to increase to 50% by next year.

The automobile industry also uses gases like propane, LNG or LPG at during manufacturing. Boparai said that SAVWI will move to biogas as it is considered carbon neutral. The company will also be net water positive by next year, he said. Being net water positive means using that the company uses less water than it conserves through rain water harvesting.

In 2015, the Volkswagen Group was caught installing software in its diesel vehicles that detected when it was being tested for emission levels and cheated by reducing emissions only for the test duration.

The Group has now set the target of becoming carbon neutral as a company by 2050 – this means that the net emissions of its entire value chain, right from production of steel and batteries to emissions from the vehicles it sells, will be zero.

To that end, it will be launching a slew of EVs. In India, the group planned to launch EVs first through its premium brands Porsche and Audi starting 2020. The plan however got delayed due to the Covid-19 pandemic. For the VW and Skoda brand, the company is still evaluating the prospect of launching EVs.

At the manufacturing plants, to install future solar and wind energy projects the company would consider operational-expenditure models, where the infrastructure is owned by the developer and the company pays for its use, Boparai said. “These are not times to make big investments.”

At Pune, the solar photovoltaic plant was installed under a develop-own-operate agreement with Amp Energy India, a developer of clean energy infrastructure, under a power purchase agreement for 25 years.


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