Supply chain sustainability
Supply chain sustainability

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Supply chain sustainability

2.2 The impact of manufacturing and production on the environment

When considering the environmental impact of production, we are looking at two key elements:

  • the pollution caused by generating the energy used in production
  • the pollution caused by the manufacturing process itself.

Pollution from energy production

Not just large traditional industries use lots of energy. For example, the information and communication technology (ICT) industry consumes massive amounts of power. However, in the absence of the large smoking chimneys that traditional industries have, this fact gets easily overlooked. The UK’s Parliamentary Office of Science and Technology (2008) predicts that ICT will be responsible for 3% of global emissions by 2020.

Just keeping the data available that facilitates a smoothly running supply chain requires vast amounts of energy. Have a look at the numbers in the United States:

US data centres consumed about 70 billion kilowatt-hours of electricity in 2014, the most recent year examined, representing 2 percent of the country’s total energy consumption, according to the study. That’s equivalent to the amount consumed by about 6.4 million average American homes that year. This is a 4 percent increase in total data centre energy consumption from 2010 to 2014, and a huge change from the preceding five years, during which total US data centre energy consumption grew by 24 percent, and an even bigger change from the first half of last decade, when their energy consumption grew nearly 90 percent.

(Sverdlik, 2016)

A total of 90% of all the energy used in a data centre goes to keeping the system cool. Admittedly, this is not just data required for the supply chain (it also includes videos of silly wet cats, and pictures of your colleagues on the beach), but you hopefully get the point.

Activity 2 Energy consumption in your organisation

Timing: 20 minutes

In his book How Bad are Bananas?, Mike Berners-Lee calculates the carbon footprint of a vast range of items.

  • A spam email, unopened, has a carbon footprint of approximately 0.3g CO2e (carbon dioxide equivalent, the standard unit for measuring carbon footprints).
  • An average email produces approximately 4g CO2e.
  • An email with a large attachment results in approximately 50g CO2e. So an email with a long attachment sent to nine people has the same carbon impact as flying a tonne of freight one kilometre.

Consider the large energy consumers in your organisation.

  • What proportion of the consumption is due to ICT?
  • Does your organisation have a strategy for reducing energy use? Does that include ICT?
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Pollution from the production or manufacturing process

In some cases, the pollution caused by the business activities is clearly visible. Consider the extreme examples of the BP Deepwater Horizon oil spill in 2010 or the explosion at the Chernobyl nuclear plant in 1986.

But in other cases, the pollution that is created in the production processes of goods and services is less obvious. Consider a power plant that draws water from a river to cool its systems and then returns the warmer water back to the river. Even if no chemicals are added to the water and safeguards are in place to ensure that fish are not drawn in, the warmer water changes the environment at the outlet. The changed profile of the water can alter the species that live at that point.

Any production facility will have a level of emissions to some degree. In most cases, the aim is to identify and control the emissions.

In the UK, it is the role of the Environment Agency to legislate and inspect operations. Similar agencies operate in the rest of Europe and across the world. Environment Agency officers liaise with organisations to ensure that environmental performance is optimised. Rigid limits are set for the release of pollutants, and these are enforced through legislation. The costs that organisations may incur by not complying with the regulations can be vast. By adopting explicit sustainability principles, organisations are more likely to meet the standards and avoid fines and clean-up costs.

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