Monday, November 15, 2010

Cost of development is paid heavily by environment but those who gain from development, do they pay as much as a second thought to this?

A study done by us a couple of years back showed that an average Indian Household emits 2382 kgs of CO2 annually - this is 3010 in the Indian metros while it is only 1313 in rural India. In the lowest income segment of < Rs. 3000 monthly income segment, annual CO2 emission is only 1169 kg per household. This is as much as 5433 kg in the highest income segment ie., Rs. 30,000 monthly income. This amply demonstrates that the cost for development is paid by the environment. CO2 emission comes from usage of electricity, petrol, diesel, cooking fuel etc. Apart from these, there are other items like disposal of polythene, electronic items, batteries, cell phones etc which also contribute significantly to eco hazards caused as an aftermath of economic development as we understand it.

This development will be difficult to afford over the long run. That sustainabledevelopment needs to eco friendly is a well accepted fact. But those who benefit from the rewards of development,  are they aware of the costs and more importantly, are they willing to pay for the cost rather than making environmemnt pay for it.

To check this out we took the category of mobile phones to check the consciousness of the eco impact of mobile phones. Cell-phones contain elements like cadmium, lead, lithium, arsenic, mercury and beryllium, which are a potential threat to the eco system if not discarded properly. Lots of cell phones are discarded by just throwing away, wherein these hazardous elements in the cell phones come into direct contact with earth’s eco system. Some of their elements become toxic over time or when they are in contact with water over long time. The immediate impact is contamination of the earth and any water source that may come in contact with the cell phone waste. Then comes the issue of EMRs ie the dangerous radiations emitted by usage of phones.

Does the common user realizes the eco hazards of cell phones. And if so, what aspects of these, is the user aware of and is he willing to pay a premium for a more eco friendly phone. To check this, we at AZ Research Partners conducted a survey to understand salience of eco hazards amongst cell phone users. 1100 respondents participated in this survey that was done primarily online and on phone calls.

Very interesting findings came from this research. 87% of respondents mentioned that they are very concerned about environment related issues. Key issues, they are concerned about, as shown below in the chart, are related to pollution by vehicles and pollution of rivers and oceans by industrial waste.

Eco hazards of cell phones
When specifically asked if they consider cell phones to be an eco hazard, 30% of the respondents said that they did consider cell phones to be an eco hazard and another 54% said that 'may be' cell phones are an eco hazard. The key concern that the respondents have with cell phone are related to radiations which are considered as eco hazards - 55% of the respondents mentioned EMRs as the key eco hazards of cell phones. That cell phones have toxic metals and other compounds which poison soil and water disposal was mentioned as an eco hazard by 34%.

Benefits sought from Eco friendly phones
33% of participants felt that low radiation handset is the most important eco benefit for them and close to this, 31% felt that ‘made from eco friendly materials’ is the most important eco benefit in cell phone. These two are closely followed by ‘easy to recycle’ which in essence is same as made from ‘eco friendly materials’. These users are interestingly willing to pay a premium of upto 20% over normal phones for these 3 benefit propositions.

Therefore, our key takeout from this exercise was that urban consumers are concerned about environmental issues. They are aware of eco hazards of a category like cell phones which has a very high penetration in urban India and most importantly, are willing to pay a premium for more eco friendly phones.

Are manufacturing companies listening?

For detailed report on this research click on the link

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