To combat rising fuel prices in it’s dairies, Aavin has planned to go for a mix of energy sources including solar, bio-brickettes and compressed natural gas (CNG).
It is looking to invest close to ₹100 crore in phases to save on furnace oil and electric bills. The milk major uses around 50,000 units and 35,000 litres of furnace oil per day for various purposes, including generation of steam to run the boilers.
Sources in the Tamil Nadu Cooperative Milk Producers Federation, whose popular brand is Aavin, explained that the cost of furnace oil went up from ₹45/litre to ₹85/litre. “We require 250 ml of furnace oil to make 1 litre of ghee from butter. Transportation costs have gone up, and the cost of even the packaging jars has spiralled. Butter is under an inflationary pressure, which is also one of the reasons that Aavin increased the price of ghee recently,” explained a source.
Though Aavin has already invested in solar and CNG plants in various dairies, including in Madurai and Chennai, an official said these were small and standalone plants.
“The capacities need to be upped. At present, solar power panels contribute only around 5% of our total consumption. We are also exploring the possibility of using bio-fuel brickettes being made by the Greater Chennai Corporation. Minor modifications would have to be carried out in the equipment but that is secondary. These power sources will help reduce our dependency on the power grid and furnace oil,” another official said.
With power bills set to increase, the changes are to come at the right time for the milk major that has been working to make more profits for its milk-pouring farmers.