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Why Decarbonizing Supply Chains Matters?

Climate change is one of the biggest challenges facing our planet today. As global temperatures continue to rise, it is becoming increasingly clear that we need to take urgent action to reduce our carbon footprint and prevent further damage to our environment. One critical step towards achieving a more sustainable future is to decarbonize supply chains.

Supply chains are the backbone of the global economy. They involve the production, transportation, and distribution of goods and services, and they are responsible for a significant portion of global greenhouse gas emissions. From manufacturing to shipping, every step in the supply chain contributes to the carbon footprint of the products we use and consume every day.

To combat climate change, it is essential to reduce the carbon emissions produced by supply chains. By doing so, we can help mitigate the effects of global warming, protect the environment, and ensure the sustainability of our planet for future generations. Decarbonizing supply chains involve a range of measures, including transitioning to renewable energy sources, optimizing transportation and logistics, reducing waste and emissions from manufacturing, and encouraging more sustainable production and consumption practices.

One of the biggest challenges in decarbonizing supply chains is the complexity of the global economy. Supply chains are often spread across multiple countries and involve a vast network of suppliers, manufacturers, and distributors. Coordinating these complex systems to reduce carbon emissions requires collaboration and coordination among all stakeholders, including governments, businesses, and consumers.

World Economic Forum estimates that only eight supply chains are responsible for more than 50% of global emissions. Take the steel and concrete industry as an example. Together they make up around 15% of man-made CO2 emissions. The same e-book released by WEF estimates that low-carbon steel would add less than 2% to the price tag of a new family car. WEF says that for all of the eight supply chains, decarbonization solutions are already available.

We’ve decided to provide you with an overview of the key strategies for decarbonizing supply chains, and their additional benefits.

What are the key strategies for decarbonizing supply chains?

One key strategy for decarbonizing supply chains is the adoption of renewable energy sources. This involves transitioning away from fossil fuels such as coal and oil and towards cleaner energy sources such as wind, solar, and hydropower. This can be achieved through the installation of renewable energy systems such as solar panels or wind turbines, as well as through the purchase of renewable energy from third-party providers.

Another important strategy is the use of low-carbon materials and technologies. This involves selecting materials that have a lower carbon footprint than traditional materials, such as recycled or bio-based materials. It also involves the use of technologies that are more energy-efficient and produce fewer emissions, such as electric vehicles or energy-efficient lighting.

Sustainable transportation systems are also a critical component of decarbonizing supply chains. This involves reducing the carbon footprint associated with the transportation of goods and services by adopting more sustainable modes of transportation such as rail, electric vehicles, or cargo bikes. It also involves optimizing transportation routes and reducing the distance that goods need to travel to reach their destination.

Decarbonizing supply chains also requires a collaborative effort from businesses, governments, and consumers. Businesses need to work together to share best practices and develop new technologies that can reduce carbon emissions across the entire supply chain. Governments need to provide support for the adoption of renewable energy and sustainable transportation systems, as well as regulation to ensure that businesses are accountable for their carbon footprint. Consumers also have a role to play by demanding products that are sustainably produced and by supporting businesses that are committed to decarbonizing their supply chains.

Additionally, you might want to check out our intel piece on six European companies accelerating decarbonization, as there is a plethora of disruptive start-ups already doing the necessary work.

What are the benefits of decarbonizing supply chains?

Other than obviously a sustainable future, decarbonizing supply chains have a number of other benefits, such as:

  1. By decarbonizing your supply chain, you can potentially save money over time. For example, investing in more efficient transportation methods can reduce both fuel costs and emissions, while utilizing renewable energy sources can lead to lower energy bills.
  2. Decarbonizing your supply chain can lead to greater efficiency by streamlining operations and reducing waste, ultimately resulting in faster product delivery and a reduced overall environmental impact.
  3. Companies that are embracing supply chain decarbonization are gaining a competitive advantage in the marketplace. Those who do not follow suit may find themselves at a disadvantage.
  4. In today’s world, consumers are increasingly interested in supporting businesses that prioritize sustainability. By decarbonizing your supply chain, you can enhance your company’s reputation and attract new customers who value environmentally conscious practices.

In conclusion, decarbonizing supply chains is an essential step toward achieving a more sustainable future. It requires the adoption of a range of strategies, including the use of renewable energy, low-carbon materials and technologies, and sustainable transportation systems. It also requires a collaborative effort from businesses, governments, and consumers. All of them need to come together with transparent goals and solutions, in order to make decarbonization happen. By working together, we can reduce the carbon footprint of our supply chains and move towards a more sustainable and equitable future.

Decarbonization of our current economy is not an easy task. It requires all industries to transform, but luckily there are companies that are willing to take the challenge and help accelerate the mission to achieve a zero-emissions society. Since decarbonization is slowly becoming one of the most crucial sectors within GreenTech, there is an increase in the importance of having a skilled workforce. At Storm4, we pride ourselves on working with the best talent across all GreenTech sectors, so in case you’re looking to expand your team, don’t hesitate to contact us to accelerate the mission of a more sustainable future.

We’ve helped some of the most successful GreenTech startups grow.

— now it’s your turn.