A recent report from Carnegie Mellon University added numbers to our suspicions that a large portion of China’s emissions are from producing goods for export. 1.7 billion metric tons of carbon dioxide, or 33% of China’s emissions, are the result of activities related to the production of export goods. With roughly 18% of Chinese exports going to the US, the US is indirectly responsible for about 6% of China’s emissions, or over 300 million metric tons of CO2.
In the absence of an international agreement on reducing greenhouse gas emissions that includes both the US and countries such as China these “export emissions” are only going to grow. A standard corporate greenhouse gas inventory, spanning Scope 1 (direct emissions from fuel combustion, methane and refrigerant leakage) and Scope 2 (indirect emissions from electricity use), would exclude any contractor emissions resulting from outsourced activities, including those occurring overseas. This, of course, ignores a major component of a product’s life cycle emissions, the “upstream” emissions. While many companies may simply choose to ignore these emissions because they are outside of their control and responsibility, other companies have taken a more proactive approach. By performing a life cycle greenhouse gas analysis a company can better understand and manage its products’ supply chain. This also allows a company to approximate their exposure to the risk of escalating fossil fuel prices through their suppliers. Internalizing these impacts is not only good product stewardship but also helps avoid future costs by enabling a company to decrease their exposure to this sort of risk.
Another significant impact in a product’s life cycle is the use phase. Despite the media focus on the impacts of cotton production in the textiles supply chain the largest impact by far actually comes from the washing and drying by consumers. While this may seem out of the domain of producers, the delivery of a service (the service that clothing provides) while minimizing the non-product outputs (packaging, waste, electricity use, greenhouse gas emissions, etc.) benefits the customer and becomes a selling point. Many companies have begun to employ this thinking in wrinkle- and stain-resistant clothing as well as clothing with embedded silver nano-fibers that ward off odor-causing bacteria.
Of course, this different way of viewing a product’s supply chain can be applied to any sort of product, or even service. The first step is always measurement of metrics because “what gets measured, gets managed.” More proactive supply chain management can mean a significant reduction in China’s rapidly growing emissions, lower costs for the company, and a better quality product for the consumer.
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