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Hindustan Unilever Ltd (HUL), India’s biggest household goods maker, has eliminated the use of coal across its operations in India, replacing it with cleaner biomass and biodiesel, as part of a plan to cut carbon emissions.

Although the journey towards zero coal use started five years ago, with parent Unilever committing to do away with the fuel by 2020, HUL managed the feat a year ahead of schedule and has recently transitioned its three factories acquired from GlaxoSmithKline Consumer Healthcare in April 2020 to biofuels.

“The impact of this transition not only increases HUL’s green footprint but also improves the quality of air around its factories and enhances the income of farmers through the buying of biomass," Willem Uijen, executive director of supply chain at HUL, said in an interview. The factories that manufacture Horlicks and Boost had boilers run on coal. They were converted to biomass/biodiesel boilers. HUL bought the Horlicks, Boost, Maltova and Viva brands from GSK last year.

By stopping the use of coal—which spews one of the highest amounts of carbon dioxide among fossil fuels—HUL has removed a significant polluter from its production process and contributed to its parent’s aim of achieving net-zero emissions by 2039. Large businesses such as Unilever face investor and regulatory pressure to reduce environmental impact amid a looming climate crisis.

Uijen, who is also part of HUL’s environment committee, said HUL has a network of 32 manufacturing sites across the country, covering all product categories since 98% of everything that HUL sells in India is produced in India.

The majority of these plants use a lot of heat, which is generated in boilers. “In 2019, all factories we had in HUL at that point in time, we transitioned out of coal and used two alternative fuels—furnace oil, which is still a petrol or a crude oil-derived fuel, and biomass," Uijen said.

The biomass the company uses includes the stubble that farmers are left with after the harvest, and sawdust. “We also used cooking oils, oils that come from refineries, or those from the production that we have, for these biomass boilers," Uijen said.

HUL sources biomass from communities around the factory. “You can’t transport sawdust for a very long distance. It becomes too expensive. And if you do that, the benefit you give the environment by using biofuels goes away because you have still transported the biomass with diesel-powered trucks," he said.

Using stubble as biofuel helps farmers generate income from this crop waste that they used to burn, causing air pollution. However, Uijen said while some factories still use furnace oil, work is on to transition all plants to biomass in the next two years.

HUL also leads in other sustainability goals. “We are the only market for Unilever today where 100% of our plastic footprint, meaning all of the plastic that we use in production of all of our packaging, is being collected directly by us. That means we collect over 120,000 tonnes of plastic waste from the streets of India and ensure it gets processed in the right manner; that it doesn’t end up in landfills or on streets or in the ocean," Uijen said.

India is the second-largest market by sales for Unilever after the US. “But if I look at it by volumes, India is by far the largest market of Unilever anywhere in the world," he added.

Over the years, HUL has also turned to solar panels and windmills to meet its electricity needs, in keeping with its green goals. Though it is not possible to source renewable energy everywhere, Uijen said, the company is using it wherever it is allowed to put up its installations.

It either places solar panels on rooftops and signs power purchase agreements with partners who set up solar parks, or makes off-site installations for energy production in place.

Being sustainable requires initial capital, but the cost is gradually declining. “If you went back 10 years ago, we wouldn’t have been able to do what we’re doing today. But the price of solar panels has gone down so drastically over the last two decades that today we see the use of solar in all of our sites feasible financially, even though we need to invest for it," he said.

Uijen said although Indian consumers are concerned about plastic pollution and the effects of global warming, it is unclear whether they are willing to pay more for a product that addresses some of these problems. “If we want to scale up fast and large, we need to make the systems work without the consumers having to pay for them."

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