How to create energy efficient supply chains
Decreasing energy use at a main office or manufacturing plant may help the bottom line and reduce a company’s carbon footprint. But companies often don’t pay attention to the supply chain, which is one of the least energy efficient aspects of a business.
Huge companies with massive supply chains such as Dell, Ford, Unilever, Pepsi, Best Buy and Walmart, often in conjunction with non-government organizations, have put in place reduction targets and initiatives focused on upstream and downstream supply chain impacts. Reducing the carbon footprint of all sectors of businesses small and large is now expected.
To help companies figure out how to increase energy efficiency in their supply chain, the University of Minnesota Institute on the Environment’s NorthStar Initiative for Sustainable Enterprise, along with the Environmental Defense Fund, provide valuable suggestions on why and how to do so in a new report, “Supply Chain Energy Efficiency: Engaging Small & Medium Entities in Global Production Systems.”
To realize these opportunities we must manage energy across organizations, industry sectors, supply chains and regions, which will require significant new and increasingly more transparent data, common metrics and analytics, writes Monica Michaan of the Environmental Defense Fund.
Public and private collaboration will be crucial to reduce the transaction costs of implementing supply chain energy efficiency, particularly with regard to credit enhancement, technology provider accreditation and governmental policies, she writes.
The report highlights four recommendations to save energy:
- Engage leading companies to identify high-quality suppliers for pilot supply chain energy efficiency improvements.
- Create one or more sector-based collaborations for improving supply chain energy efficiency by assembling groups of peer manufacturers within a supply chain and using benchmarking, process capability analysis and best practice sharing to identify and improve energy efficiency and industry competitiveness.
- Increase transparency and standardization of energy use, audits and supply chain information.
- Create finance and credit risk approaches and models for portfolio-level energy efficiency and energy management projects.
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.