Consumer pressure will drive the market for green products

Written by Prachi Raturi Misra | Updated: Aug 31 2009, 22:45pm hrs
The energy labelling programme launched by the Bureau of Energy Efficiency is setting new benchmarks in the country. The bureau is being assisted by Intertek. It is the only laboratory recognised by BEE to provide check-testing of room air-conditioners, refrigerators and other consumer goods of leading brands like Carrier, Samsung, LG and Whirlpool. A leading international provider of quality and safety services to a wide range of global and local industries, Intertek has made it to FTSE 100 indexs top-100 companies. Wolfhart Hauser, CEO, Intertek, spoke to FEs Prachi Raturi Misra about Indias energy-efficiency labelling programme, its strengths and weaknesses. Excerpts:

How do you assess the energy labelling programme launched by the Bureau of Energy Efficiency (BEE)

The BEE programme was introduced in May 2006 and is applicable to products manufactured in India or outsourced from India. Currently it has not yet taken effect, but companies need to prepare, test and develop their new products in line with this compliance.

Initially, the mandatory labelling requirement will be applicable on products such as air-conditioners, refrigerators, distribution transformers, and tubular fluorescent lamp and these must have energy-efficiency labels from January 2010 onwards. Furthermore, BEE plans to add more products that need to have energy star rating labels before they can be sold.

You are a key provider of services to BEE. How do you rate the programme vis--vis other countries

Indias energy labelling programme is based on the Indian Standard (IS). However, BEEs energy labelling programme requires products to have an energy-efficiency ratio (EER) 5% higher than that mentioned in IS. Indias energy-efficiency labelling programme for FMCG products is at par with the best practices followed in other countries but the regulatory norms may differ from country to country.

What is your experience working with Indian firms

Indian companies are very inclined to get involved in new technologies and are open to investing money in them and research and development. India has some brilliant engineering minds and many Indian R&D teams have done fantastic jobs in developing new products to meet the new standards in what might seem to be a short product-development time frame.

What is the kind of change you have noticed in Indian corporates over the last 15 years Intertek has been here

Intertek has observed a major shift in the outlook of Indian corporates over the last few years and it is continuously evolving with time. They have become more quality conscious and have improved upon their manufacturing processes over time. Today, they not only want to be ahead of their Indian counterparts but also look up to match the global standards as well. They are also more focused on the need to invest in right testing and certification in order to comply with the requirements of their international buyers as well as to compete in the global marketplace.

How serious are Indian companies about undertaking energy conservation measures compared to their global counterparts

With time and increased exposure to global best practices, Indian corporates are definitely becoming serious about energy conservation and are conscious about depleting sources of energy. They are now opening up to adopting greener technologies to make their systems, processes and products ecofriendly. However, there is a huge need for services and infrastructure to support them in implementing such initiatives and accommodating energy saving processes in their manufacturing .

Its a common perception that making energy-efficient goods is expensive. How do companies manage

Thats a myth. Most of our major customers see it as an upfront investment with the return on investment by 3-5 years. In the long run, we find that customers are not only happy with the money saved but also use the new greener products that have been created to promote their brands. Additionally, these products are helping to face the challenges of power deficit in India, which is important.

What are the biggest challenges facing the Indian Industry environmentally

In India like any other country, the dynamics governing the business activities are unique in its basic form. When you look at some other international countries, and in particular some smaller nations with environmentally-focused governments, one could say that by comparison, the need for environment protection and energy conservation is yet to seep deep into the work culture and patterns of the Indian businesses.

From Interteks work worldwide, an important feature in successful adoption of new greener products and processes in a country is effective monitoring and enforcement of compliance by the government or a regulatory body. In some countries, for example, Intertek has partnered with the local regulatory authority responsible to help monitor and test how manufacturers are complying with new laws.

How important is pressure from consumers

Consumer pressure for greener products also plays an important part and will also drive change in the market. But here in India there is still certainly great scope for educating and creating awareness in people to help in environmental preservation. India has all the right positive intentions, but there is a need to increase actions and overcome the challenges in the country. The new energy-efficiency labelling is a great step along that path. India is deficit in power supply and with the demand for power projected to increase fivefold in the next 20 years, energy-efficiency is a critical way forward.