Cutting Carbon in the Supply ChainFor many manufactured products, the majority of their carbon footprint comes from energy used in extracting, refining, processing, manufacturing and transportation.

There are several options for reducing the carbon footprint:
· redesign manufacturing process; use alternative raw materials and new technologies to find energy efficiency savings
· shorten supply chains; reduce CO2 from transport
· Use / purchase renewable energy; renewable energy produces (almost) zero carbon

Using renewable energy is the easiest and most effective way to cut the carbon footprint of a product. Why isn’t everyone using or buying it? There are several possible reasons but two stand out; cost premium and availability of supply. In some areas energy companies may apply a ‘green’ tariff but not necessarily. Availability of supply is more of a challenge in many areas. Globally in 2005 renewable sources contributed 18% of electricity generation (including hydro), less than 3% of heat consumption and 1% of transport fuel consumption. The total energy generated from renewable sources is rising but at the same time so is overall energy demand meaning green energy can be in short supply.

As a purchaser looking at the carbon footprint of the supply chain, asking suppliers about the source of energy for manufacturing can provide quick wins. Comparing suppliers by asking a few simple questions could find low carbon options:
1. Have they invested in renewable energy generation?
2. Do they purchase ‘green’ energy with an auditable trail?
3. Do they have combined heat and power?
4. Have they invested in energy efficiency measures?

It is also worth bearing in mind that energy prices can be volatile. Once installed renewable energy provides a more stable supply price. Manufacturers investing in renewable energy will not only have a lower carbon footprint but could also offer longer term price stability.

 

Tom Bowers

Tom is an environmental and life cycle analyst and a supply-management advocate. He believes that Purchasers are in a great position to deliver sustainability goals and objectives for all types of organization. He has worked for over 10 years in Policy and Research in government, the 3rd sector and private sector. More importantly, he has a wealth of ideas to share with the supply chain profession.

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