Generating solutions for energy reduction across the supply chain

How China can harness the power of supply chains to save costs, energy and ultimately the environment

Gearing up for the start of a new school year begins with shopping for new school supplies. Your daughter has asked for the latest princess backpack and a full set of colored pencils. While she has insisted that you buy the set of 36 and not 12, she has not specified any carbon footprint limit. And neither have you.

Turns out, your purchases hold great promise for reducing emissions. According to the International Energy Agency, the global industrial sector emits approximately one-third of energy related CO2 emissions and consumes the same amount of total primary energy supply.

Luckily, a perfect storm of consumer awareness, corporate responsibility and government incentives has ushered big US players like Walmart into the spotlight, who can use their market clout to move their suppliers away from wasteful practices. The good news is that from a technical standpoint, we know how to help companies like Walmart reduce their footprint at in a way that actually saves a lot of money.

But despite making economic sense, the average company implements less than two thirds of energy efficiency projects. We can attribute a lot of this disparity to the complexity of the marketplace in China, where most consumer goods on the shelves of US retailers are manufactured. Among these small and medium sized producers, the scale is vast. Coordination is difficult. The true numbers are obscured. The promise of financial return is hazy. There is a lot of room for improvement.

In October of last year Environmental Defense Fund (EDF) partnered with the University of Minnesota Institute on the Environment’s NorthStar Initiative for Sustainable Enterprise (NiSE) to convene 31 participants from energy service companies, finance, retail, NGOs, government and academia to brainstorm real solutions to this challenge.  This week, we’re launching The Supply Chain Coordination and Energy Efficiency Symposium report to summarize the group’s findings and outline a roadmap to close the gap between the energy efficiency opportunities that are identified and those that are implemented in the supply chain.

Once again, EDF’s commitment to “finding the ways that work” has paid off in spades. This group of unlikely partners has crafted ideas that will help guide our work moving forward. Our ideas included staging pilot programs at leading companies, engaging peer manufacturers to collaborate and compete for success, and advocating for increased industry transparency.  Finally, and most importantly, we emphasized the need to find quick and easy ways to prove to investors what we already know—that investing in energy efficiency pays back, and pays back well.

At the heart of this report lies the goodwill of unlikely partners working together to catalyze solutions. As we know, the trick is ensuring that these solutions are not only imagined, but that emission reductions are realized both in the US and in China, both among industry giants and small businesses. A purchase as simple as a backpack and colored pencils could be a powerful tool in securing a safe future for your daughter. This report is a step toward that future.