Over the course of 2020 Siemens Gamesa has recorded several major decarbonisation successes – reaching carbon neutrality in our corporate operations and making the switch to being powered 100% by electricity from renewable sources being two important signs of our progress. But we are committed to going further in our ambitions: reducing indirect emissions in our supply chain, perceived as a key bottleneck for accelerating our transition, will be a vital next step on our journey to net-zero emissions by 2050.
With over 80% of the carbon footprint of our wind turbines linked to the materials used in their manufacturing, we are working with our suppliers and supporting them on their own journey to achieving this end.
Manufacture of the steel sections used to build turbine towers is the main source of carbon emissions when assessing the climate impacts of a wind turbine, with CO2 released during fabrication accounting for roughly twice the tower’s weight. So, towers struck us as a great place to start.
After an initial assessment of the CO2 emission figures, we concluded that it was time to act. Together with the procurement team, we developed the ‘Tower Supply Chain Decarbonisation Programme’ that aims to reduce the environmental impact of the company’s tower suppliers leading the way to a more sustainable supply chain.
Launched in early 2019, the programme – which has the mission of cutting CO2 emissions emitted during the manufacturing process of our turbines and the required raw materials to achieve a sustainable value chain – has given our team full transparency in seeing where the CO2 emissions occur and how they can be reduced. This, in turn, allows us and our suppliers to push for the needed change in manufacturing processes.
Our programme is based on three pillars: one, implementing a transparent annual process to evaluate the sustainability performance of each supplier; two, incentivising suppliers to join the effort in reducing the shared environmental impact by rewarding good performance with a bonus system; and three, establishing a collaborative relationship with suppliers through education and guidance on sustainable industrial practices.
The decarbonisation project for our tower supply chain has witnessed very promising first results. Three of our main tower suppliers have already agreed to switch to renewable energy sources. This will reduce the relative global average carbon intensity of tower manufacturing by 75%, entailing an absolute reduction of about 20,000 tonnes of CO2 emissions a year – and equal to 20% of the emissions generated by our main suppliers in total.
If we compare this figure with the emissions derived from our direct operations, it accounts for a 72% reduction of those emissions. But this is more than a number, it represents real action and changes – and has led for example to the installation of solar panels in one of our supplier’s factories to power its operations.
And this is just the beginning: other suppliers of ours are planning to follow the example, introducing further significant CO2 reductions. The idea is to expand the initiative to around 40 contractors, targeting a reduction of 100,000 tonnes of CO2 in 2021.
For me, this project is an example of a corporate culture that allows individual ideas to grow and prosper. It shows that we can make a huge difference with what others would consider small changes by simply collaborating internally and pushing our external partners to operate more sustainably. It makes me proud to see that Siemens Gamesa saw the value in our initiative and that it is now being rolled out to the entire tower supply chain globally.
The procurement department became the critical partner in this programme, collaborating on the concept to bring the tangible results. The value of this initiative is now proven and is being rolled out for our entire tower supply chain globally.
Through the transparency achieved in this programme, we are helping our suppliers tackle the most relevant and climate-impacting areas of their operations. This implies, of course, encouraging them to innovate, change and push ideas forward to achieve our carbon emission reduction targets together.
The decarbonisation of manufacturing processes of Siemens Gamesa’s suppliers is becoming a contractual requirement. A ‘Sustainability/Greenhouse Gas Emissions’ category is being incorporated into the yearly supplier evaluation process and gives the company’s contractors an opportunity to present their CO2 reduction efforts.
We are working to implement a sustainable procurement approach, which means that we not only focus on a cost-benefit analysis, but also see the bigger picture of how to maximise the benefits for both the company and society. When we select a tower supplier to work with, the decision is based on criteria that supports the decarbonisation of the supply chain alongside the conventional procurement criteria of price, quality and delivery reliability .
The supply chain decarbonisation programme has offered up lessons that can be applied to other areas of our organisation too. We are currently expanding this for tower procurement globally, meaning quadrupling the number of suppliers involved, but then we will be gradually widening the scope from there across multiple high impact commodities we use.
The last year’s work has shown how the commitment of a dedicated team can lead to great results and accelerate our decarbonisation efforts to limit global warming to maximum 1.5°C over pre-industrial levels. Siemens Gamesa still has a long way to go to reach its ambitious decarbonisation goals but is taking firm steps on the road to a low-carbon value chain, a critical piece of the puzzle of corporate commitment to achieve net zero emissions across their operations.
· Cresten Flor is head of the onshore tower operations team at Siemens Gamesa in the Northern Europe and the Middle East region