Chemical Leasing is a new strategy introduced by UNIDO to reduce the consumption of chemicals and minimizes harmful environmental impacts caused by them. The novelty in Chemical Leasing is that it brings together the supplier and the user to form a partnership through which chemicals are used more efficiently and in an environmentally sound manner.

Chemical Leasing strives for a win-win situation and aims at increasing the efficient use of chemicals while reducing the risks of chemicals and protecting human health. It is cost effective to both the supplier and the user. It also improves the economic and environmental performance of participating companies and enhances their access to new markets. Key elements of successful Chemical Leasing business models are proper benefit sharing, high quality standards and mutual trust between participating companies.

The traditional business model

According to the traditional system chemicals are a commodity that are sold by suppliers and bought by users. Therefore users now become the sole owners of these materials which mean that they are responsible for the storage, usage, management and disposal of chemicals. The supplier has a clear economic interest to sell more quantities of chemicals to the user and this practice can lead to high chemical wastage. If the consumer on the other hand takes measures to reduce his consumption it can have a negative business impact on the supplier.

Chemical leasing business model

Chemical Leasing is a service-oriented business model that shifts the focus from increasing sales volume of chemicals towards a value-added approach. The supplier sells the functions performed by the chemical instead of the chemical itself and these functional units become the basis for payment. In this business models the responsibility of the supplier is extended beyond selling of chemicals to include the entire lifecycle of the chemical.

Chemical leasing activities

Chemical Leasing is a new concept being introduced in the country to reduce environmental impacts of chemicals through the development of a synergy between user and supplier. NCPC offers awareness and training services to interested industries. NCPC has developed special in-house capacity building programmes that can be conducted at the request of companies.

NCPC also conducts chemical assessments as well as organized demonstration projects on Chemical Leasing in selected sectors. The centre can further assist industries in developing chemical leasing projects by conducting pre-evaluation of the chemical used and calculating the potential of process optimization.

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