Transitioning to Renewable Energy in a Manufacturing Plant

Problem Statement:

ABC Manufacturing Pvt. Ltd. is a leading industrial conglomerate in India, specializing in the production
of automotive components. The company operates a large-scale manufacturing plant located in a semi-
urban area, which primarily produces engine parts and transmission systems for various automobile
manufacturers.

The manufacturing plant is a significant consumer of energy, relying predominantly on conventional

sources such as coal and natural gas to meet its power requirements. Currently, the plant consumes
approximately 20,000 MWh of electricity annually, with 80% of this energy derived from fossil fuels.

Given the increasing concerns about climate change and the rising cost of conventional energy sources,
ABC Manufacturing recognizes the urgent need to transition towards renewable energy sources. The
management team is seeking to explore the feasibility of integrating renewable energy solutions into
the plant's energy infrastructure to reduce its carbon footprint, lower operating costs, and enhance its
environmental sustainability.

Questions to Address:

1. What is the current energy consumption of the manufacturing plant, and how much of it is
derived from fossil fuels?
2. What are the potential renewable energy sources that could be integrated into the plant's
energy mix, considering factors such as availability, reliability, and scalability? How suitable are
solar, wind, biomass, or hydropower options for the plant's location and energy requirements?
3. What would be the upfront investment required to implement renewable energy solutions,
including the installation of solar panels, wind turbines, biomass boilers, or other infrastructure?
Estimate the initial capital expenditure (CAPEX) for each renewable energy option.
4. How would the transition to renewable energy impact the overall operating costs of the
manufacturing plant? Estimate potential energy savings, maintenance costs, and potential
government incentives or subsidies for renewable energy projects.
5. What is the projected return on investment (ROI) for the transition to renewable energy, and
how long would it take for the company to recoup its initial investment? Calculate the payback
period and annualized ROI for each renewable energy option.
6. What are the potential environmental benefits of transitioning to renewable energy, such as
reduced greenhouse gas emissions and improved air quality? Quantify the potential carbon
emissions reduction and other environmental impacts.
7. What challenges or barriers might the company encounter during the transition process, such as
regulatory hurdles, technical limitations, or financial constraints? Estimate the potential risks
and mitigation strategies for each identified challenge.
8. What are the key performance indicators (KPIs) that can be used to monitor the success and
effectiveness of the renewable energy transition over time? Develop a framework for tracking
performance data and reporting progress towards sustainability goals.

Additional Information:
• The company aims to achieve a 50% reduction in carbon emissions by 2030.
• The manufacturing plant operates 24/7, requiring a reliable and continuous power supply.