Tech-driven transformation: reducing supply chain emissions for a greener future

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Michael Cox

By Michael Cox, APAC Sustainability Consultancy Director, Schneider Electric

As Australia grapples with meeting climate targets by 2050, businesses must maintain visibility across their operations and the broader value chain to manage emissions effectively. Supply chain emissions play a prominent role in the  environmental footprint of businesses, averaging 11.4 times higher than operational emissions.

Emerging technologies are offering some reprieve as powerful tools to aid this transformation. From data analytics and automation to AI-powered logistics, these innovations are revolutionising how companies reduce environmental impact across their entire supply chain while maintaining efficiency and competitiveness.

The role of technology

As technology keeps evolving at breakneck speed, businesses must learn to harness its potential. In transport logistics AI and machine learning are optimising routes and reducing fuel consumption. Automated systems can streamline warehouse operations, reducing energy consumption and waste. Advanced data analytics provide businesses with the insights needed to identify inefficiencies, enabling them to make informed decisions that drive sustainability.

With global environmental regulations becoming increasingly stringent, transparency is a key factor in holding businesses accountable for their sustainability practices. Technology is vital in enhancing this transparency by providing real-time data and advanced analytics to monitor resource usage, emissions, and other environmental impacts across the supply chain. Tools like blockchain and IoT sensors ensure traceability and data analytics, allowing businesses to track materials from source to the end product, ensuring compliance with environmental standards at every stage.

Renewables and electrification

Renewable energy sources like solar, wind and hydropower help mitigate the environmental impact of operations. Solar power allows companies to harness clean, abundant energy, lower dependence on fossil fuels and generate renewable electricity on-site. Hydropower provides reliable, large-scale energy that powers industrial operations and supply chains with minimal emissions. Aside from being cleaner, hydropower supports grid stability by balancing intermittent renewable sources like solar and wind.

Using renewable energy sources to electrify consumption is a key strategy for decarbonising the energy system. Electrification is therefore crucial in helping businesses to reduce emissions, meet climate targets, and build greener supply chains. Companies can significantly lower their carbon footprints by replacing traditional fossil fuel-powered systems with electric alternatives powered by electricity from renewable sources.

Electric vehicles are reducing transportation emissions. Electric heat pumps and renewable-powered machinery are transforming industrial processes by cutting energy consumption and reliance on coal or gas. These increasingly common changes in larger organisations contribute directly to decarbonisation efforts when executed as part of a holistic strategy.

Navigating an evolving landscape

Collaboration is key for Australia’s industries to drive sustainable solutions across supply chains.  Businesses must navigate an increasingly complex terrain of technological options and organisational considerations to optimise energy usage. By working with supply chain ecosystem partners, companies can innovate more effectively, share best practices, and maintain regulatory compliance. This collaborative effort facilitates more efficient, low-carbon supply chains that provide mutual benefit across ecosystems.

The drive towards sustainable supply chains is no longer just an environmental imperative; it is quickly offering a competitive advantage and seen as a risk management activity. Australian companies that adopt AI, automation, and innovative technology can lead the way in building greener, more efficient supply chains, positioning themselves at the forefront of the global shift toward sustainable business practices.

The compound effect of peak demand 

The issue that’s not receiving the same attention is the issue of increasing peak demand. We’re seeing the impact happening faster and progressively more intensely. The more we delay renewables projects, the more intensely we will hit the issue of peak load where we will be trying to squeeze more and more activity into a shorter window of opportunity.

The compounding challenge is that we are doing this against a backdrop of increasing investment in electrification (industry, buildings, and mobility), plus hydrogen and mining for critical minerals, and exponential growth in data centres.

There are some options to solve this. Standardisation and digitisation of the design, engineering, and construction process – especially through digital twins that enable comparative scenario analysis – has the potential to offer substantial cost reductions, optimised processes, and reduced lead times.

The cheapest and easiest way to start 

For years, conversations about the energy transition have focused on replacing our supply with renewable sources, but more than half the work needed is on the demand side, using technology to optimise commercial energy use.

The good news is that we can tackle this now: 70% of CO2 emissions can be removed with existing technologies – all we need to do is deploy at speed.

Regardless of the energy mix, across the board, energy digitalisation is necessary. It’s cheaper, faster, and easier to save a unit of energy than it is to make one greener, and it’s also a boost for operational efficiency overall.

About Schneider Electric 

Schneider’s purpose is to create Impact by empowering all to make the most of our energy and resources, bridging progress and sustainability for all. At Schneider, we call this Life Is On.

Our mission is to be the trusted partner in Sustainability and Efficiency.

We are a global industrial technology leader bringing world-leading expertise in electrification, automation and digitisation to smart industries, resilient infrastructure, future-proof data centres, intelligent buildings, and intuitive homes. Anchored by our deep domain expertise, we provide integrated end-to-end lifecycle AI enabled Industrial IoT solutions with connected products, automation, software and services, delivering digital twins to enable profitable growth for our customers.

We are a people company with an ecosystem of 150,000 colleagues and more than a million partners operating in over 100 countries to ensure proximity to our customers and stakeholders. We embrace diversity and inclusion in everything we do, guided by our meaningful purpose of a sustainable future for all.

www.se.com

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