The views expressed are those of the author and do not necessarily reflect the position of FORESIGHT Climate & Energy
Finding synergies across industry, production and renewable energy is key to 2050 net-zero reduction targets
Global warming has been a constant topic of discussion since the turn of the century. However, since the Paris Climate Agreement in 2015, the severity of the matter has become clear, as has the need for action from all major greenhouse gas contributors. In response, many companies have already or are just beginning to intensify their efforts to address the climate crisis.
Most major enterprises now have comprehensive sustainability strategies and are also beginning to set specific carbon reduction targets to contribute to the global goal of net-zero by or before 2050. To get more carbon under management, most companies break down their emissions into three scopes, according to the GHG Protocol.
When it comes to corporate carbon footprint, it is important that emissions across all three scopes are reduced. Scope 3 accounts for the most significant share of those emissions by far, in some cases as much as 85-95% of a company’s total. For many, Scope 3—and specifically the carbon footprint of the supply chain—holds the key to getting started with meaningful and attainable emissions reductions.
SUSTAINABLE SUPPLY CHAIN
The supplier carbon footprint (SCF) can become a rabbit hole of complex reduction opportunities, but in the short-term it is a great starting point where companies can identify “low hanging fruit”. Once a company is able to measure SCF contribution to its overall CO2 emissions, it can see which of its suppliers are major contributors to its total emissions.
At first, one might think this could create tension in the working relations between companies and suppliers—but that is far from the truth. Often, companies value the relationships that have developed with their suppliers and beyond that, changes in supply are not always simple to implement.
Instead, this opens the door for companies to begin working with their highest-emitting suppliers to reduce their footprint. This is where this “low hanging fruit” comes into play.
ENERGY AND PRODUCTION
If we are going to curb the trend on global warming, businesses should and must work together with suppliers to decarbonise their production. Not only is this the right choice for the climate, but as this topic grows heavier on the public consciousness, it becomes a competitive advantage for both parties.
One of the most immediate ways suppliers can impact their carbon footprint is by switching their production energy supply to renewable energy sources. If companies already have a handle on their carbon management internally, one of the most effective ways they can support suppliers in this switch is by setting targets.
For instance, if a company sees that a supplier is one of its highest emitters, they can set clear reduction targets for suppliers so they know the exact range of reduction they need to achieve and by when, in order to maintain future working relationships.
This means rather than receiving a vague and possibly confusing ultimatum from a company, suppliers can instead enter a dialogue about decarbonisation and develop a plan to meet targets. This energy transition will not happen overnight, but if given the necessary targets, suppliers can take the first steps to planning their energy switch.
When looking at the overall decarbonisation of value chains, the link to the transformation of the energy sector as moving in a more sustainable direction becomes clear.
We should push to expand our thinking on how this shift can be used to benefit not only residential and commercial users, but industries as a whole for more environmentally sustainable production.
The more that the sector continues to expand renewable energy sources, the more affordable those energy options become, acting as a sustainable driver throughout other sectors. •
Do you have a thoughtful response to the opinion expressed here? Do you have an opinion regarding an aspect of the global energy transition you would like to share with other FORESIGHT readers? If so, please send a short pitch of 200 words and a sentence explaining why you are the right person to deliver this opinion to email@example.com.
Offsetting emissions is fraught with problems and critics fear these programmes could distract from the real goal of keeping fossil fuels in the ground
Recycling existing aluminium has significant carbon benefits compared to producing brand new material. However, the limited resources cannot keep up with the growing demand. The industry is looking to reduce carbon intensity while maintaining aluminium’s benefits
The growth of wind power capacity is accelerating globally, with 2020 a record year for new installations. But with the expansion comes a growing mass of production waste, emissions from manufacturing and transport, and discarded components from retired machines. The industry’s turbine makers are facing up to the problem but proposed solutions remain commercially immature
There is no clear definition of climate neutrality despite 117 cities worldwide setting it as a target in the coming decades. Where Paris will include all emissions it produces, regardless of the sector or source, Copenhagen only calculates CO2 emissions related to heating and electricity. But both will claim to be neutral. This results in different levels of ambition, says Raphael Hasenknopf from Energy Cities
What investors and governments do with their money sets the direction of the global economy. Mainstream money was directed to fossil fuel for more than a century, leaving clean energy technologies swirling in the eddies. But during 2020 the flow of money dramatically changed course. The stream to fossil fuel slowed to a trickle and now oil and gas is at risk of being left high and dry.
The world’s building stock is forecast to double in size by 2050 to house a global population of 11 billion. If climate neutrality is also to be met by this date, the construction industry will have to significantly slash emissions from the materials it uses
An EU taxonomy to define green investments is expected to enter into force in 2021, but some experts want it to be used immediately to inform stimulus packages aimed at dealing with the social and economic fallout from the Covid-19 pandemic