By Kamlesh Kukreti, Kunal Ganguly, Indian Institute of Management Kashipur (IIM Kashipur)
The importance of telecom operations has increased manifold over the last decade and is further projected to increase. The growing requirement for bandwidth has led to more power consumption by the telecom sector, resulting in a higher carbon footprint. The Indian telecommunication industry accounts for approximately 1% of India’s total carbon dioxide emissions, much higher than the global telecom industry’s carbon dioxide emissions standard of 0.7%. Therefore, it can be said that the contribution of the Indian telecommunication industry to the total CO2 emissions is lagging behind the world average in percentage terms. The poor performance in carbon emission mitigation is attributed to lenient regulations such as voluntary carbon disclosure and under-reporting of carbon emissions, as carbon emission measurement is majorly limited to operational activities (TRAI, 2017). Such lenient approaches distort the image of organisational carbon footprint while, on the other hand, increasing emissions due to the possibility of telecom operators remaining scot-free. The telecom sector in almost all developing countries faces these challenges and requires immediate attention.
A high-level supply chain structure in telecommunications encompasses equipment installation, operation, and service delivery. Suppliers, contractors, and equipment providers work together to install telecom infrastructure in the equipment supply chain. Once installation is complete for better network and value-added services, a whole ecosystem needs to be developed, where mobile operators collaborate closely with value-added service (VAS) providers, content/applications providers, and equipment and device manufacturers. In the operation supply chain, using ICT tools to detect a critical event, an IP-based monitoring facility for identifying faults at the tower shelter location can reduce carbon emissions due to the reduction of unnecessary movements of field staff. Furthermore, other GIS-enabled cable fault location tracing, advanced fuel management technologies, smart metering technology, and fuel theft monitoring systems can reduce diesel/electricity consumption of overall operation requirements. The ecosystem that caters to its customers through mobile and fixed-line telephone exchanges is the Operation Supply Chain. At the component level, using DC fan coil units, high-efficiency rectifiers, intelligent power monitoring systems, and extensive sleep mode can reduce energy wastage of total operation requirements. Telecom companies encouraging biofuel and adopting alternate energy can reduce carbon emissions in day-to-day operations. Traffic offloading from cellular networks to Wi-Fi access points, smaller outdoor BTS, and free cooling systems at tower locations can further reduce carbon emissions during daily operations. Catering telecom services to customers again requires an ecosystem where telecom operators, channel partners, and e-tailers work closely and constitute a service supply chain to provide services through their existing network. Telecom companies manage a large service delivery supply chain involving thousands of distributors, retailers, and their vast offices. Carbon emission on account of channel partners comes under SCOPE III, and telecom companies generally avoid its accounting. The telecom operator seeks support from these three sub-supply chains, namely the equipment supply chain, operation supply chain, and service supply chain, and works closely with the regulator who frames policies. Regulations and policies drive firms to engage in green procurement and environmental assessment; however, it requires the government to play an active role in achieving carbon emission reduction targets. In the service sectors, the participative approach in carbon declaration and the make-to-order approach have brought many encouraging results. Studies from China indicate that incentivisation to supply chains, cap and trade policy, and imposing carbon taxes can reduce carbon emissions in the telecom sector. The introduction of a net-zero economy and circular economy in the supply chain has benefitted all the players in carbon emission reduction.
For carbon emission reduction, deploying better measurement practices to identify excessive use of energy and the availability of measurement indices is critically required. The Indian telecom industry lacks proper measurement tools to benchmark the performance of telecom companies on sustainability; it also carries legacy issues pertinent to voluntary carbon disclosure and overtly focuses on operation-related carbon emissions. There is an urgent need for all types of carbon emission reduction initiatives in the telecom sector to be brought under one roof, along with assessing their importance and impact. Identifying the driving factors behind carbon emissions and exploring low-carbon technologies are the main driving forces to control carbon emissions. To reduce carbon emissions in the telecom sector, it is vital to identify the essential dimensions of the Telecom Supply Chain (TSC). It is crucial to identify and prioritise the critical factors from the entire TSC along with the dimensions beyond operations to ensure the inclusion of overall carbon emission (SCOPE I, II, III).
This inspired a faculty member of IIM Kashipur to conduct related research on sustainability in the telecom sector along with his PhD student, a seasoned expert in the field. Their work proposes a framework capable of measuring the environmental sustainability of telecom companies beyond their operation activities and accounts for all types of carbon emissions (SCOPE- I, II, III). They studied the impact of Equipment, Operation, Service Supply Chain, and Regulations and Policies on overall carbon emission in the telecom supply chain. In the process, the authors have interacted with many industry experts to develop a basic understanding of the problem along with literature on the subject. Their work identifies the most critical factors that reduce carbon emissions in a multiple-stage telecom supply chain through an extensive literature review and expert interaction, followed by developing an environmental sustainability index to measure carbon reduction efforts. A detailed survey was conducted among the personnel of the Indian telecom sector to understand the initiatives for carbon emission reduction. The study shows that it is possible to reduce carbon emissions if active and passive infrastructure sharing is encouraged among operators. The study demonstrates the role of all four dimensions in the telecom supply chain. It is advised that the telecom operators should seize the opportunity of the revolution of green procurement initiatives; they should encourage channel partners to adopt green initiatives, and the respective governments should create a conducive environment for adopting sustainable regulations and policies.
In the operation supply chain, using ICT tools to detect a critical event, an IP-based monitoring facility for identifying faults at the tower shelter location can reduce carbon emissions due to the reduction of unnecessary movements of field staff. Furthermore, other GIS-enabled cable fault location tracing, advanced fuel management technologies, smart metering technology, and fuel theft monitoring systems can reduce diesel/electricity consumption of overall operation requirements.
At the component level, using DC fan coil units, high-efficiency rectifiers, intelligent power monitoring systems, and extensive sleep mode can reduce energy wastage of total operation requirements. Telecom companies encouraging biofuel and adopting alternate energy can reduce carbon emissions in day-to-day operations. Traffic offloading from cellular networks to Wi-Fi access points, smaller outdoor BTS, and free cooling systems at tower locations can further reduce carbon emissions during daily operations. Telecom companies manage a large service delivery supply chain involving thousands of distributors, retailers, and their vast offices. Carbon emission on account of channel partners comes under SCOPE III, and telecom companies generally avoid its accounting.
Consolidating retail deliveries, route optimization of sales forces, and collaborative approach with another product seller can reduce carbon emissions. In addition, an incentive for the channel partners to adopt green initiatives and sustainable HR practices will also help reduce carbon emissions. On the technology front, adopting cloud computing, using IT in service provisioning, and generating E-bills are highly effective in reducing the overall energy requirement of channel partners.
Encouraging channel partners to switch to natural refrigerants, providing tools to calculate CO2 emissions in service centers, and developing environmental consciousness among partners are low-cost strategies to reduce carbon emissions among channel partners.
Regulations and Policies drive firms to engage in green procurement and environmental assessment; however, it requires the government’s active role in achieving carbon emission reduction targets. In service sectors, the participative approach in carbon declaration and the make-to-order approach have brought many encouraging results. Studies from China indicate that incentivisation to supply chains, cap and trade policy, and imposing carbon taxes can reduce carbon emissions in the telecom sector. The introduction of a net-zero economy and circular economy in the supply chain has benefitted all the players in carbon emission reduction. However, net zero and circular economies in developing countries are still nascent and face many barriers. Encouraged by the effect of the circular economy in developing countries in the manufacturing sector, the government plans to adopt reverse logistics in the telecom sector (TRAI, 2017).