By Eric Austermann, Vice President, Social & Environmental Responsibility, Jabil.
Carbon emissions reduction is among the top objectives for corporate environmental management programs. Not only is the environmental impact of greenhouse gases familiar and visible to the public, it carries a high potential for future regulation. In addition, lowering carbon emissions often goes hand-in-hand with energy cost-cutting, which can provide a critical business advantage.
In many cases, corporations begin their carbon emissions reduction efforts by targeting individual sites and implementing local programs. This tactical approach is a logical way to start, but typically lacks the stringency, oversight, and documentation of a strategic global system. That is why manufacturing solutions provider Jabil continues to replace its site-specific efforts with a Global Environmental Management System and is pursuing multi-site ISO 14001 certification for its locations.
Instead of waiting for ISO 14001 compliance requests from customers at the facilities where their products are manufactured, manufacturing solutions providers like Jabil have proactively undertaken the necessary steps, with the goals of:
- Advancing their corporate sustainability strategy
- Aligning with customers’ current and future environmental goals
- Readying the company for upcoming regulations across the world
- Participating in initiatives such as the Carbon Disclosure Project for sharing and managing environmental data
How it Works
The Global Environmental Management System is a platform for executing corporate sustainability commitments. Under this platform, reducing carbon emissions is the primary target where all sites are held equally accountable for contributing to carbon reduction and complying with internal requirements that are more stringent than localized (site-level) mandates. The Global Environmental Management System provides the ability to execute global initiatives and assess progress at a corporate level.
While this system embraces a holistic (corporate and global) focus, it is complemented by grassroots employee engagement campaigns to drive local involvement and enthusiasm. An example is a program entitled Do Your 2, which challenges every employee to do two things to support carbon and energy reduction goals – from turning out unnecessary lights to replacing plastic water bottles with reusable bottles or water coolers.
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Example Projects Across the Globe
There are several major projects that can help support global carbon emission reduction goals. The first example comes from Asia, where a manufacturing solutions provider reduced the consumption of liquid nitrogen (LN2) used for testing electronic products and components and cooling certain types of equipment. The lifecycle of LN2 requires large amounts of energy and, therefore, generates significant carbon emissions.
The project involved upgrading cooling chambers from LN2 to a water chiller system and installing a nitrogen gas generator system on site to avoid transporting the material. The results have been impressive: energy consumption in cooling chambers was slashed by 71 percent, transport of LN2 was eliminated and equipment power consumption in the facility was cut in half. The total reduction of CO2 emissions per year totaled 13,935 metric tons.
A facility in Mebane, N.C., created a factory sustainability program with multiple components. Installation of a 0.25 megawatt solar system on the roof has saved 330,000 kwh of electricity over 2.5 years. Four wind turbines powered by a small electric press add another source of renewable energy. Further, the facility is recycling scrap materials from its production line, which cuts landfill by about one million pounds annually. Overall, the project is cutting carbon emissions by 225 metric tons per year.
Two initiatives in Europe are achieving notable results. In Kwidzyn, Poland, at a company that manufactures solar panels, the factory analyzed the energy required to produce one panel and has implemented process improvements that reduced that amount by 32 percent. On an annual basis, that equates to a reduction of 145,000 kwh of electricity and 100 metric tons of CO2 emissions. At another facility in the Netherlands, a number of projects, such as replacing the lighting and heating/cooling systems and optimizing warehousing to reduce overhead, led to a savings of 1.1 million kW-h of energy and 1150 metric tons of CO2 emissions over a three-year period.
The combined amount of carbon emissions saved by the four initiatives outlined above is over 15,000 metric tons. According to the US Environmental Protection Agency greenhouse gas equivalence calculator, this equates to a reduction equivalent to 1,681,614 gallons of gasoline or electricity usage for 2,064 homes for one year.
How We Are Doing
The Global Environmental Management System has yielded both tangible and intangible benefits. As a result of the significant carbon emission reduction accomplishments, Jabil for example was able to reduce global emissions by 16% from 2009 (baseline) to 2011. Due to business mix changes in 2012 that caused significant growth in energy-intensive operations, companies like Jabil may have ended CY2012 at a cumulative 4% carbon emissions reduction from the 2009 baseline, leading to companies possibly setting new baselines for their carbon emissions reduction program in CY2013, keeping the company on track to consistently achieve a cumulative 2–5% reduction between each baseline.
This strategy has put manufacturing solutions providers in an excellent position to comply with anticipated environmental regulations in various countries, such as China. By obtaining accurate (third-party-verified) carbon emissions by factory, companies can target key facilities that are approaching or exceeding the anticipated caps imposed by local governments. Leveraging this accurate data, they can drive focused programs and initiatives to reduce energy consumption in advance of regulatory changes. For example, last year Jabil conducted a focused energy audit in the company’s Shenzhen, China, site, along with other projects. As a result, they are already saving nearly 50,000 kwh per month in energy consumption.
The ability to meet customer requirements is another benefit of the global strategy, giving the company a competitive advantage by making it easier and more appealing to do business with the company. For instance, in September 2013, HP announced a greenhouse gas emissions reduction goal of 20% from 2010 to 2020 for its first-tier manufacturing and product-transportation supply chain partners. As other customers implement sustainability goals involving suppliers, companies are prepared to meet them.
Although adopting a rigorous global carbon emissions reduction strategy involves more planning, coordination, and effort than site-by-site tactics, the return on investment (ROI) is significant. This type of strategy can deliver immediate benefits in environmental protection and corporate cost reduction, while providing a strong foundation for compliance with upcoming regulations and changing customer expectations for suppliers. In addition, it allows organizations to play a role in global sustainability initiatives, helping to enhance their reputation for corporate responsibility.