RMI Releases Report Introducing New Guidelines for Accelerating Decarbonization of Corporate Supply Chains
Beijing, China – September 28, 2022
The decarbonization of Fortune 500 companies’ supply chains plays a significant role in the global efforts to combat climate change. In its new report Financing Energy Efficiency: Accelerating Decarbonization for Electronics Manufacturing Supply Chains, RMI introduces newly developed guidelines to support electronic companies in China to find feasible and cost-effective financing solutions for achieving global carbon footprint reduction targets.
Energy efficiency financing (EEF) is commonly recognized as one of the most effective but underutilized supply chain decarbonization measures. Through in-depth analysis of existing energy efficiency projects and financing solutions, RMI works closely with leading electronic companies that have extensive suppliers ranging from raw materials to semiconductor and packaging, to identify gaps and jointly problem-solve for better energy efficiency financing solutions.
The new RMI report is one of the first in China to provide specific EEF guidelines for electronics manufacturing supply chains. The guidelines introduced in the report facilitate the efficient utilization of existing financing solutions. Leading electronic companies at the center of the supply chains could drive large-scale EEF actions for their suppliers using RMI’s guidelines.
The guidelines were developed based on RMI’s examination of the typical decision-making process of energy efficiency projects, analysis of the barriers to implement the energy efficiency projects (including lack of incentives, complications in execution, decreasing subsidies, high transaction cost etc.), and summary of the scenarios where energy users may have challenges while implementing the projects.
For each financing solution, corporate cases are also elaborated in the report to help better illustrate the workflow. For example, Apple has taken the approach that explores energy efficiency as a service (EEaaS, one of the available financing mechanisms) to expand suppliers’ access to energy efficiency. Apple connects suppliers to energy management contractors that offer both financing and energy efficiency expertise to support complex capital-intensive projects. These benefits carry over to the other technology products Apple’s suppliers manufacture, reducing both Apple’s footprint and that of the industry.
“As this white paper explores solutions at a sectoral level for companies operating in the electronics manufacturing supply chains, the key findings are also applicable to other industries and may trigger discussions and sector-based solutions within other industries. We are hoping to collaborate with all relevant parties on further improving sector-based innovation to support ambitious corporate climate goals toward carbon neutrality,” noted Ting Li, managing director and chief representative of RMI’s Beijing office.
While the report presents a roadmap to achieve significant efficiencies in decarbonizing supply chains, to fully achieve China’s carbon neutrality goal, further innovation and more extensive support from financiers, energy users, and policymakers will be needed. The report also proposed innovation directions including providing guarantees to the financial return of energy efficiency projects, leveraging group efforts to obtain financing terms, and increasing the leverage multipliers of policy incentives.
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About RMI
RMI is an independent nonprofit founded in 1982 that transforms global energy systems through market-driven solutions to align with a 1.5°C future and secure a clean, prosperous, zero-carbon future for all. We work in the world’s most critical geographies and engage businesses, policymakers, communities, and NGOs to identify and scale energy system interventions that will cut greenhouse gas emissions at least 50 percent by 2030. RMI has offices in Basalt and Boulder, Colorado; New York City; Oakland, California; Washington, D.C.; and Beijing.
More information on RMI can be found at www.rmi.org or follow us on Twitter @RockyMtnInst.
