The Future of Manufacturing

How digitalization can solve the carbon crisis

We must limit global warming to
to minimize the impact of climate change suggests a 2018 Intergovernmental Panel on Climate Change (IPCC) report.
So what do we do now?

That may not seem much, but every 0.5 ˚C rise in temperature increases the risk of extreme and life-threatening weather patterns, water shortages, coastal floods and other harmful environmental effects. For example, heat waves are becoming more frequent, with both Europe and America experiencing freak temperatures in 2019.

By 2030, global net human-caused emissions of carbon dioxide (CO2) would need to fall by about 45% from 2010 levels, reaching “net zero” by around 2050. Therefore, companies and countries need to make “rapid and far-reaching” transitions in land, energy, industry, buildings, transport, and cities.

Green is good for business

It’s not just an environmental imperative — there are also sound economic reasons for decarbonizing. Companies that follow green policies can boost customer loyalty and brand image. They can also attract employees, reduce operating costs, and increase shareholder value. Latest World Economic Forum (WEF) research reveals that companies which focus on environmental initiatives have been growing by an annual rate of 15%. Additionally, based on nearly 80,000 emission-reducing projects reported by 190 Fortune companies in 2016, almost $3.7 billion was returned in savings.

Rising to the 1.5°C challenge

Mitigating climate change is therefore an increasingly important corporate strategy, with companies striving to protect the environment and at the same time reap the commercial benefits

While businesses have become accustomed to setting emission targets for greenhouse gas, the goals have often been arbitrary. To achieve lasting value, more rigorous targets are required. Research by Schneider Electric and GreenBiz media show that companies that set public energy and sustainability goals are more likely to receive project funding and explore innovative alternatives like renewables.

Knowledge is (clean) power

Data is at the heart of sustainable practices. While companies spend more than $450 billion on energy and sustainability initiatives every year they struggle with data quality and need to use available data more effectively. Better energy management and reporting would help to highlight efficiencies that could reduce carbon emissions.

Only a small number of firms — 18% — use technologies such as sensing devices with connectivity to the cloud, which would enable remote monitoring and real-time analysis. Better data collection and reporting would help to highlight efficiencies that could reduce carbon emissions and minimize waste. With the right infrastructure and actionable data, sustainability can be embedded in the entire production cycle — everything from supply chain management to energy consumption and recycling.

Lidl is leading the way

Lidl is setting higher standards. In Finland, the company runs on 100 percent renewable energy through a new distribution centre that draws on IoT-enabled microgrid and building solutions from Schneider Electric. The centre is the largest totally renewable industrial microgrid in Finland. It includes an advanced building automation system, and covers an area equivalent in size to 10 football pitches. The centre benefits from Schneider Electric’s EcoStruxure Microgrid Advisor, a software-as-a-service cloud-based solution with powerful analytics which teaches the building to predict events and optimize energy use, which has resulted in energy cost savings of over 70 percent.

Finding the right focus

Electrification is one route to a more sustainable future. Not only is it safe, reliable and clean, it can also absorb the rising global energy demands resulting from digitization, urbanization and industrialization. With industrial energy use alone set to increase by at least 50% over the next 35 years, companies must look closely at their current practices and focus on preserving finite resources.

One example of good practice is Equinix, the global interconnection and data center company. By working with Schneider Electric’s Energy & Sustainability Services advisors to source renewable energy power purchase agreements Equinix has boosted renewables to 100% for North America and 82% for its global needs. The result is a saving of $23.2 million.

120 million metric tons avoided CO₂ on our customers’ end through our offers
Sustainability Impacts

Schneider Electric itself is committed to reach carbon neutrality by 2030 and being powered by 80% renewable electricity by 2020. The company has also helped many other RE100 signees to reach the same goal. After taking steps for efficiency, the next step, if more energy is needed, is to adopt renewables by the different ways of buying it. That combination of efficiency and fostering renewable energy has also helped Schneider to get closer to its goal of avoiding 120 million tons of CO2 on behalf of their customers by 2020.

Taking the right steps together

With renewables and distributed energy resources on the rise, companies have a unique opportunity to be more profitable in the long run. Digital transformation can help set the world’s economy on a sustainable footing. Digitizing enables cloud analytic tools to make timely recommendations based on reams of historical and real-time data. Results from Schneider Electric customers indicate that these savings can be substantial — up to 50 percent reductions in investment costs, with an average savings of 23 percent. It can also help companies create achievable targets for a greener future and accelerate the transition to a low-carbon economy.

By taking active steps forward, working together and harnessing digital technology, we can create a more sustainable future.
Make sure your company is ready to embrace the power of sustainability and digitalization.

2019 Corporate Energy & Sustainability Progress Report

Download report
Finding 1 :
Is funding a false barrier?
Finding 2 :
The real data challenge
Finding 3 :
The aim of public targets
Finding 4 :
Energy sourcing saves money
Finding 5 :
Technology gets traction

More than 300 industry professionals reveal why and how companies are leading the transition to an energy efficient and sustainable future.

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This page was paid for by Schneider Electric. The editorial staff of CNBC had no role in the creation of this page.