CNV1-I1-14-Environment

The automotive industry is a wide range of companies and organizations involved in the design, development, manufacture, marketing, servicing and selling of motor vehicles. It is one of the world’s most important economic sectors and generates huge employment opportunities. Automobile is one of the most highly recovered and recycled products material centric industry in the world as it consists of parts and materials which can and should be utilized at their End-of-Life (EOL) or End of Vehicle (ELV).

Automobile is a metal dominated complex product which comprises of about 15000 components. It is one of the most highly recovered products in the world (i.e. an automobile is about 95% recyclable). Average weight of the vehicle ranges between 1 to 1.5 Ton depending upon category it falls into.

ENVIRONMENTAL AND SOCIAL IMPACTS OF IRON AND STEEL

The production of iron and steel can be divided into five different steps namely: treatment of raw materials; iron making; steel making; casting and rolling; and finishing. Steel production is highly energy intensive and involves melting of iron ore at high temperatures which leads to emission of greenhouse gases (primarily CO2 along with other gases like CH4 and N2O). Various factors are responsible for emissions such as combustion of fossil fuels, use of electricity, and use of coal and lime as feedstock. One tonne of steel produced in a Basic Oxygen Furnace (BOF) requires 1.6 tonnes of iron ore, 0.6 tonnes of coking coal and 0.21 tonnes of steel scrap. Extraction of iron from its ore is resource intensive and estimates suggest that production of 1 tonne of iron requires 1.4 tonnes of ore, 0.5-0.65 tonnes of coke, 0.25 tonnes of limestone or dolomite, and 1.8-2 tonnes of air (OECD, 2012; OECD & IEA, 2001).

Recycling iron and steel has many financial, economic and environmental benefits as it reduces landfills disposal of waste, reduces the need to extract and manufacture raw materials, as well as contributes to the reduction of pollution and GHG emissions. Recycled steel uses 75% less energy than steel made from virgin raw materials (Hyder Consulting, 2009). All types of steel are 100% recyclable and can be recycled infinitely without a loss in quality. Recovery of 1 tonne of steel scrap conserves an estimated 1,030 kg of iron ore, 580 kg of coal and 50 kg of limestone (Fenton, 1998).

India’s passenger vehicle density is set to double by 2020 on the back of low vehicle penetration and a population in which 66% of the people are below 35 years of age. The country’s low vehicle penetration of 32 vehicles per 1,000 people in 2015 makes it one of the world’s most attractive auto markets. Vehicle penetration has shown considerable increase from 24.4 in 2012 to 32 vehicles in 2015. Consistent GDP growth of will fuel the industry growth.

Samir Phatak, Mahindra and Mahindra Ltd, Mumbai, Manager, Corporate Management Services.

At present India does not have any voluntary vehicle disposal policy. The scrap processors recover metal scrap from automobiles majorly involves shredding and cutting. This shredded scrap used as one of the input material for steel manufacturers. Cast and forge materials goes back to foundry as an input. The non-metallic fraction that remains after the metals are recovered from the shredded materials; is disposed of in landfills. These materials primarily can be categorized as plastic, electronics, Battery, Oil etc. This practice is not environmentally friendly, and may become uneconomical. Therefore, it is not sustainable.

In India, the vehicle dismantlers and scrapping units are mainly unorganized and fragmented and are mainly concerned about selling quality parts, components and remaining sheet metal and CI scrap. The whole system is very unhygienic and can handle only low volumes.Further, the workers work on contractual basis lack basic social security i.e fixed pay, PF and basic medical needs and safety gears during working.

As far as regulations are concern, there is no clear mandate for Endof-Life Management of Vehicles (ELMVs) for all stake holders including Government. In India there are no such regulations and directives like in Europe regarding End-of-Life Management of Vehicles (ELMVs) which can cause designers to think about the effective automotive recovery at the design stage.

Further, the recycling of plastics and composite materials whose percentage is growing with the technology enhancement and is causing a negative impact on the environmental and economic sustainability of automotive recovery infrastructure. Presently there is no organized infrastructure to handle this.

In recent development, Government is keen on implementing vehicle policy that aims at scrapping 15-year old commercial vehicles in the first phase. Voluntary Vehicle Fleet Modernisation Program (V-VMP) policy has proposed to push 28 million decade old vehicles off the roads. If we consider the vehicle age for vehicle scrapping as 15 years and sales trend for last 15 years, it clearly shows that considerable volume of vehicle will fall into this criterion. The proposal as once it is implemented pollution would be checked considerably as 65 per cent of the pollution is caused by heavy vehicles which have completed 15 years. The proposal is to provide incentive to people who purchase new commercial vehicle, if they surrender their 15 year are over old commercial vehicle.

The government is setting up new scrapping centres to tackle the rising problem of an ever-growing population of older cars, especially after the success of first-of-its-kind scientific recycling unit at Chennai that allows environmental-friendly disposal of older vehicles. The Chennai centre was set up as a pilot project under the public-private partnership (PPP) initiative to establish a modern automotive recycling plant in India. This will help to create organized vehicle scrap industry along with potential to create the jobs. If large corporates and OEMs shows interest, it will help to increase the working standard for scrap industry and help to develop business viability for vehicle recycling as a independent sector. Once India starts generating scrap (mainly Steel and alloys) from EOL vehicles, its dependence on steel scrap imports will reduced gradually, resulting in saving on foreign exchange.

WAY FORWARD

Positive steps taken by Government to set shredding facilities at various locations, incentive to scrap Heavy vehicles aged above 15 years to begin with for scrapping, will encourage OEMs to participate in this process as major stake holder. This will further strengthen the entire eco system required to make this whole initiative to manage EOL for the old vehicles more sustainable. It will help to establish scrap sector as an industry. If Government gradually increase this incentive initially planned to offer only for Heavy commercial vehicles to other segments such as Two wheels and Passenger vehicles which shares maximum volume growth and add to pollution to a greater extent, the benefits will increase manifold. This will not only benefit the industry by steady sustainable industry growth but also help to reduce the pollution, generate direct and indirect employment. It will also help to reduce the losses to human life due to accidents caused by old vehicles.

Further, the recycling of plastics and composite materials whose