Carbon credit in AAC block manufacturing
Lot of entrepreneurs ask about carbon credits in AAC block manufacturing. Here is a post to discuss the same.
Fly ash products like fly ash bricks, AAC blocks and CLC blocks offer a viable and sustainable option compared to conventional building material like clay bricks. While clay bricks are produced by using top soil and then sintered in open kilns using fuel like coal. Not only does this process consumes top soil, but also generates lots of green house gases (GHG) due to inefficient combustion of coal. Along with polluting the environment, it adversely affects health of workers.
On the other hand, like fly ash bricks, AAC blocks and CLC blocks offer a sustainable solution to these problems by using industrial waste like fly ash. These units also provide a better work environment to workers and cut back on GHG emissions by using alternative curing methods. As it stands, fly ash products offer a truly ‘green’ opportunity for environment as well as entrepreneurs. I would like to share some more information that would make these green products even greener for entrepreneurs.
United Nations Framework Convention on Climate Change (UNFCCC) has a methodology in place that allows just that. As per As per AMS III Z, fly ash brick/block manufacturing industry can apply for and avail carbon credits for various sections like process improvement and energy efficiency. I have shared some relevant details to help entrepreneurs understand this methodology.
Ideally you should start from the time you have firmly decided to proceed with the project. First stage of the process is Project Feasibility Assessment. Final stage of carbon credit process is CER issuance. CER stands for Certified Emission Reduction and is technical name for carbon credits. Entire process takes 8-9 months depending on various factors. So if you have timed it right, you’ll have your CER issuance by the time you hit production run.
In addition to details mentioned above, there are certain points that need to be kept in mind before drooling about carbon credits.
- Project should demonstrate that the revenue earned from carbon credit is seriously considered at the time of project viability study. In case it is found that said project is not profitable but just a means to generate revenue using carbon credits, it might not be approved.
- Electrical energy and any other fuels used towards manufacturing of the final product are also accounted as emissions and counted accordingly. Works in favour of fly ash brick and CLC block manufacturers. AAC block manufacturers might lose on this count.
- Green blocks should be sun dried and water cured. It is ideal to have a biomass or any renewable energy based steam generation system to reduce any kind of negative emissions. Another advantage to fly ash bricks and CLC block manufacturers and a warning bell for AAC block and steam cured CLC block units.
All is not lost though. As per an approved report that I studied, an Autoclaved Aerated Concrete (AAC) project in India with production capacity of 500 m3/day has potential to earn ~ 50,000 carbon credits. Estimated cost of 1 carbon credit is 10 Euros. This means that 50,000 carbon credits will generate revenue of 500,000 Euros/year (~ Rs. 3.5 crore). Now that is one mean sum of money, when you consider total investment required for 500 m3/day project is around Rs. 14-17 crore excluding land. But then again, keep in mind that your project has to be profitable and sustainable before you get your carbon credits. Usually contracts for carbon credits run for 10 years. So be honest about what you mention in Project Design Document (PDD) and stick to it. Let us keep it clean and green.
I am a consultant for AAC industry, so if you really want to dig deep about carbon credits, get in touch with some good carbon credit consultant and seek their advice. I can recommend some of their names. And in case you need any technical information from me, I am just an email/phone call/comment away. 😀