Vedanta Aluminium, Manufacturing for the Future

The momentum of the global transition to clean technologies is fast increasing in response to the pressing need for urgent climate action and sustainable lifestyles. This is evident in the commitments to Net Zero and Sustainable Development Goals made by several countries and organizations globally. This shift to a net zero economy will be metal-intensive, with sustainable materials like aluminium playing a crucial role in this transition.

Rahul Sharma, CEO at Vedanta Aluminium Ltd.

Aluminium’s high strength-to-weight ratio, superb electrical & thermal conductivity, exceptional design flexibility, corrosion resistance and infinite recyclability will find critical applications in sunrise sectors such as high-tech manufacturing, energy and storage solutions, electric vehicles, renewable energy, low carbon or green products, green buildings and sustainable packaging. Consequently, the global aluminium industry is poised for exponential growth to cater to the emerging demand for clean energy solutions, green technologies and sustainable systems.

The global aluminium industry is the fastest-growing metal industry today, and its demand is expected to increase from 86 million tonnes in 2020 to 120 million tonnes by 2030. India’s demand is expected to double to approx. 8 million tonnes by 2030, driven by a surge in building & construction, transportation, packaging, electrical, defence and aviation.

Making in India for the world

Vedanta Aluminium, one of the world’s top aluminium producers and India’s largest aluminium producer, is well-resourced to meet this growing demand. In FY22, the company produced more than half of India’s aluminium at 2.26 million tonnes, catering to all major growth sectors. It produced one of the largest ranges of high-quality aluminium products in the form of Restora Low Carbon or ‘green’ Aluminium  (aluminium that has a low carbon footprint), Billets, Primary Foundry Alloy (PFA), Wire Rods, Slabs, P1020 Ingots, Rolled Products, Flip Coils, T-Ingots, Sow Ingots and hot/liquid metal.

It is the largest producer of wire rods globally (ex-China) that are used in electrical distribution and India’s leading exporter of billets to developed markets like the US and Europe that are used in extrusion, buildings and construction. In the form of market-leading products, Vedanta’s aluminium finds critical applications across a wide array of industries such as aerospace, automotive, building & construction, infrastructure, electricals, consumer goods, steel, renewable energy, packaging and many others, spanning over 50 countries.

Vedanta Restora, greenifying products & value-chains

Vedanta Aluminium is the first in India to launch its low carbon ‘green’ aluminium, branded ‘Restora’, to address the fast-growing global demand for low carbon footprint aluminium, driven by greater climate consciousness. In fact, it is the first major non-ferrous Indian metals producer to manufacture low-carbon products (primary aluminium), reflecting the commitment to achieving Net Zero Carbon by 2050. Under Restora, Vedanta Aluminium offers two product lines – Restora (low-carbon aluminium) and Restora Ultra (ultra-low-carbon aluminium).

Manufactured using renewable energy, Restora has a greenhouse gas (GHG) emission intensity that is well below 4 tonnes of CO2 equivalent per tonne of aluminium manufactured. 4 tonnes of CO2 / tonne of aluminium produced is the global threshold for aluminium to be considered as low carbon footprint aluminium. Restora Ultra, made with aluminium recovered from dross (a by-product of aluminium smelting), has an even lower carbon footprint that is near-zero and is amongst the lowest in the world. Restora Ultra is also a testament to the company’s sharp focus on ‘zero-waste’ through operational efficiencies. With Restora, Vedanta’s customers have the assurance that the aluminium they purchase has amongst the lowest carbon footprints in the world. The company has the capability to tailor-make Restora and Restora Ultra into various products, such as Billets, Ingots, Primary Foundry Alloys, etc., customized to the needs of the end-use industries.

Customer Obsession

Customer obsession is at the heart of Vedanta Aluminium’s products, production and innovation. The company offers them the highest quality of products as well as a bundle of advantages through 360-degree holistic solutions that support them at various stages of their business aspirations. Besides investing in R&D, innovation, ESG excellence, cutting-edge technology and exceptional product & service quality, the company is working with its customers to co-create product solutions through its ecosystem of technical experts and Centre of Excellence.

The company aims to convert 100% of its product portfolio into value-added products and reduce the import dependence of Indian industries for true self-reliance. For instance, Vedanta Aluminium has indigenously developed Primary Foundry Alloys (PFA), Cylinder-head Alloy for the automotive sector, and AlSi3 Ingot for the steel industry are shining examples of high-quality domestically manufactured products catering to the needs of Indian industries. These alloys were hitherto being entirely imported into India until Vedanta started manufacturing them indigenously.

Its Centre of Excellence brings together global expertise in metal, innovation, quality and R&D to develop the next big thing in aluminium. In fact, the company is launching an online sales solution that brings together all of Vedanta’s offerings under one roof, backed by robust CRM, finance and logistics solutions, to provide our customers with unprecedented ease of buying.

Innovating for tomorrow

With a focus on emerging aluminium applications in a low-carbon future, Vedanta Aluminium is investing in capacity expansion, R&D, innovation, cutting-edge digital solutions and value-added products and services to cater to this growing demand with top-of-the-line aluminium products. Vedanta Aluminium plans to fully utilize its existing aluminium smelting capacity of 2.3 MTPA, add new product lines and double the smelting capacity by another 0.5 million tonnes at BALCO over the next 3 to 4 years. These product lines will cater to the emerging demand across various industry sectors, for aluminium uses are rapidly evolving with the potential for greater applications in a sustainability-conscious world.

The relentless efforts of Vedanta Aluminium’s in-house R&D team have allowed it to continually explore newer applications of aluminium by focusing on application-based development, such as special wire-rods customized for usage along coastal belts for the electrical market, crash-resistant alloys for electric vehicles, etc. Taking it a step further, the company is planning to develop one of the world’s largest Aluminium Parks near its aluminium smelter at Jharsuguda, Odisha, one of the world’s largest aluminium smelters. It will attract hundreds of SMEs in Extrusion, Electrical, Casting, Auto Ancillaries, Packaging, etc., to set up their plants in the park and leverage the benefits of just-in-time liquid metal. Not just that, every SME in Aluminium Park will have access to Vedanta’s Centre of Excellence, R&D and innovation facilities, and an ecosystem of global experts.

This project comes with significant sustainability benefits as well. With direct transportation of hot or liquid aluminium to the downstream companies, there will be significant energy savings on both sides, thus reducing carbon footprint. Further, it will eliminate the need for cross-country logistics, thereby reducing freight burden as well as emissions from transportation. Overall, it will also reduce the total cost of ownership for

the downstream players, making the entire aluminium industry more cost-competitive. By supporting aluminium-based industries in such a robust ecosystem, Vedanta Aluminium aims to establish India strongly on the global map as the aluminium hub of the world.

Development that is sustainable

Climate action can no longer be put on the back-burner. It is now a matter of how fast and efficiently countries and companies must work towards it. Vedanta Aluminium is determined to grow its business sustainably through responsible utilization of resources, the highest efficiency of assets and processes, and a relentless focus on offsetting and reducing its carbon footprint. The company has a laser-focus on developing growth plans on the bedrock of Environmental, Social and Governance (ESG) excellence.

For us at Vedanta Aluminium, business growth and sustainable development are two sides of the same coin. Our growth story over the past decade stands as testimony to the same. We run some of the most energy-efficient plants in the country. As testimony to our climate action endeavours, Vedanta Aluminium has reduced its GHG emissions intensity by 21% in the 2012-21 period while almost tripling its production in the same period. In FY22 alone, our largest aluminium smelter has substantially reduced its carbon footprint by around 12% in FY22 over the previous fiscal while increasing production by 20%.

Operational efficiency and energy conservation initiatives have resulted in energy savings of 23 lakh Giga Joules across Vedanta Aluminium’s operations in the last fiscal. Vedanta Aluminium is also India’s largest consumer of renewable energy, at 3 billion units in FY22. The company has signed a Power Delivery Agreement for 380 MW of renewable energy for its aluminium smelters. This decade will also see Vedanta Aluminium redouble its efforts in water management as it strives to become Net Water Positive by 2030. As a reflection of its sustainable development practices, Vedanta Aluminium ranked 4th in the Dow Jones Sustainability Index (DJSI) 2021 world rankings for the aluminium industry.

Making operations future-ready

Vedanta Aluminium is now in a growth phase where it is poised to create the industry of the future. From assets to employees to the vertical integration of operations, the company is geared to bring a disruptive step-change and become future-ready.

We are expanding our business to unlock the full potential of our assets and add new product lines to meet the emerging demands of the market. This growth phase will see us use state-of-the-art technologies to make our operations more responsive, reliable and future-ready. Industry 4.0 is seeing us reimagine our business. Accelerating our digitalisation programmes, intelligent automation, and in-house innovations have enabled us to bolster our manufacturing excellence, use resources judiciously and boost workforce safety, making us agile in responding to market dynamics.

Vedanta Aluminium is also focused on building future-ready capabilities in its talent pool, from hiring talent in emerging tech-first specialisations and upskilling its talent base to becoming even more digital savvy. Today, its operations are far from traditional manufacturing shop floors.

 Deep learning algorithms and sophisticated modelling techniques allow Advanced Asset Performance Management at Vedanta Aluminium’s smelters and power plants. Digital twin technology for predictive and prescriptive maintenance helps ensure greater efficiency, avoid downtimes and reduce safety risks with minimal or zero human touch. A robust Manufacturing Execution System gives the company visibility of all critical plant operations, allowing for remote decision-making. These are but a few examples of how the company is leveraging leading-edge technology solutions for extracting maximum productivity.

Through Vedanta Spark, the group’s start-up incubator, Vedanta Aluminium is working with a whole host of new-age start-ups, leveraging the power of innovation and digitalization in manufacturing. The business cases where these start-ups are involved range from operational efficiency to energy storage solutions, water and waste management, smart inventory management, quality excellence, asset optimization & predictive maintenance, people safety & well-being, and many others. This is ushering in a fundamental shift in India’s manufacturing landscape, bringing it to the same playing field as that of developed countries.

Making in India for the world

India is a land of opportunities. It has all the right levers to become the manufacturing and value-addition hub of the world – rich mineral reserves (fifth largest in bauxite & coal), strategic geographic location for trade, a young and talented workforce base, huge manufacturing capacity, a vibrant ecosystem of SMEs and downstream producers, a large captive market, and a national vision for self-reliance. And yet, India imports 60% of its aluminium demand, despite having over 4 million tonnes of manufacturing capacity.

Aluminium consumption in India, currently at about 3 kg per capita, is much below the global average of 12 kg per capita, which portends significant opportunities for growth. Even with a low per capita consumption, aluminium presently contributes up to 2% of the manufacturing GDP in India, creating more than 10 lakh direct and indirect jobs across the value chain and has developed over 4000 SMEs. This is because the aluminium industry also has a high multiplier effect leading to the development of downstream SMEs and industrial clusters like aluminium parks, thereby significantly increasing capital outlay and employment opportunities.

The Indian aluminium industry has enormous potential to contribute as a wealth creator for the nation’s economic growth, with its expansive value-chain, customer and supplier ecosystems. It is an indisputable fact that India can be self-reliant on aluminium. All that is required is policy enablers to boost global cost-competitiveness and greater ease of doing business.