Ørsted has notified all its suppliers to switch to 100% renewable energy usage when providing products or services to the firm, latest by 2025. They will be the first energy company to ensure a supply chain with such decarbonization priority. This initiative stems from the existing supply chain decarbonization program, which started in 2020.
According to the company, the program has seen a majority of suppliers implement the whole use of electricity from renewable sources. The suppliers achieved this target by gathering on-site renewable electricity assets, purchasing renewable electricity certificates, or signing power purchase agreements (PPAs). An additional 15 % of suppliers have assured ørsted that they would commit to using renewable electricity exclusively by 2025.
Also, Ørsted has helped and will guide its other suppliers to select the best solutions. The program asks suppliers to use 100 % renewable electricity to manufacture wind turbines, cables, foundations, substations, and other components and services.
Mads Nipper, Group President and CEO of Ørsted, says, ‘A sustainable future for our planet requires a rapid transition to renewable energy and limiting global warming to 1.5 °C. That’s why the renewables industry must lead the pack by decarbonizing its supply chain. We’ve transformed Ørsted into a global leader in renewable energy and strongly believe that companies must demand science-aligned climate action from each other as well.’
‘We recognize the efforts undertaken by all existing and new suppliers who share our ambitions and will commit to using 100 % renewable electricity. We look forward to working together to achieve this goal as soon as possible and to set a new gold standard for the renewable energy industry.’
Ørsted commits to a decarbonization process that has reduced its scope 1 and 2 emission intensity by 87 % since 2006. It has a carbon-neutral goal to achieve in its energy generation operations by 2025. In 2020, Ørsted started the supply chain decarbonization program. It worked with strategic suppliers- those on whom Ørsted spends over 60% in procurement. The program begins by focusing on strategic suppliers so that all will later learn from them and scale up easily.
In several governments’ quest to reduce the effect of climate change, collaborations of this sort are necessary. Energy companies should not only build renewable energy capacity but bring suppliers to the light.
Ørsted is a Denmark energy company that runs entirely on green energy. It develops, constructs, and operates onshore and offshore wind farms, solar farms, renewable hydrogen and green fuel facilities, energy storage facilities, and bioenergy plants.
Among other energy companies, Ørsted is the only one with a science-based net-zero emissions target, as validated by the Science Based Targets initiative (SBTi). In Corporate Knights’ 2022 index of the Global 100 most sustainable corporations in the world, Ørsted ranks as the world’s most sustainable energy company. The CDP Climate Change A List also recognizes Ørsted as a global leader in climate action. Ørsted is currently an employer of 7,016 people, with a revenue of DKK 77.7 billion (EUR 10.4 billion) as of 2021.
Ørsted is a member of the 1.5 °C Supply Chain Leaders initiative. The initiative brings leading energy companies together to share their commitment and learnings from encouraging their supply chains to limit carbon emissions. Ørsted is a member and a leader of the initiative’s 100% renewable energy group.
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