The green tinge of local manufacturing
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Source: The post is based on the article “The green tinge of local manufacturing” published in “Business standard” on 9th August 2023.

Syllabus: GS3- Environment (Global warming) & GS3- Effects of liberalisation on the economy, changes in industrial policy and their effects on industrial growth.

News: The author discusses global efforts to localize manufacturing to meet decarbonization targets. Countries are investing in local supply chains, especially in clean energy sectors, influenced by national goals to reduce carbon emissions.

How are companies localizing manufacturing?

Schneider Electric has created regional supply chains since 2005, speeding up market entry.

Eel’s 3Sun sets up gigawatt-scale solar plants in Europe.

Tata group plans a $5.2 billion battery plant in the UK for electric vehicles.

ExxonMobil targets 100,000 metric tonnes of lithium extraction yearly.

Despite a drop in Apple’s global production sites, China’s manufacturing share for Apple increased to 38%.

What incentives are countries offering?

The US’s Inflation Reduction Act triggers billions in local manufacturing investments.

Europe, especially the UK, is offering green subsidies, though not as substantial as the US.

India introduced a production-linked incentive scheme, targeting solar and battery sectors to promote high value-added product exports.

How is investment shaping the landscape?

The US leads, raising $3.5 billion in climate-tech venture capital.

India follows, with investments of $1.8 billion, significantly influenced by Avaada Energy’s $1 billion.

What’s the future of clean energy manufacturing?

There’s a global race to localize mature clean energy production, such as solar and wind.

Emerging technologies like green hydrogen, sustainable aviation fuel, and carbon capture are gaining traction.

The Lawrence Livermore National Laboratory made significant progress in nuclear fusion, although widespread application remains distant.


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