Hitachi has announced plans to become one of the first Japanese manufacturing powerhouses to go carbon neutral across its supply chain by fiscal 2050.
According to Nikkei Asian Review, Hitachi had previously aimed to reduce direct emissions at its factories and offices to zero in net terms by fiscal 2030, while slashing those from suppliers, customers and other related companies by 80% by 2050 from 2010 levels.
Hitachi’s Chief Environmental Officer Alistair Dormer contends that the company’s new goal covers production, procurement and use of products and services across its value chain.
“Green technology in a digital world is a real engine for growth, and it’s an exciting time to help cities, governments and companies cut carbon whilst accelerating our own potential as a climate change innovator,” says Dormer.
According to the Nikkei, the Japanese conglomerate’s supply chain emitted 110 million tons of CO2 equivalent in fiscal 2019.
Out of this, 96% of the global warming gas being so-called Scope 3 emissions, came from other players in its value chain that are not part of the group’s operations.
To achieve the latest upgraded goal, extensive efforts involving about 30,000 suppliers will be essential, says Hitachi.
It is currently working on an information technology system for ascertaining precise levels of internal and external energy consumption.
The blockchain system will track where renewable energy is supplied, identifying a specific facility down to a specific piece of equipment.
This system was deployed at one of Hitachi’s research institutes in Tokyo in February and will be made available to other companies so that they can see energy consumption at factories by fiscal 2022.
Starting this fiscal year, Hitachi is asking suppliers to devise plans for reducing their carbon footprint.
The company has also revised its green procurement guidelines in July, and has begun creating a medium- to long-term plan with about 800 core suppliers that account for 70% of its purchases.
Hitachi is also bolstering its commitment to prioritize environmentally friendly facilities and equipment when making investment decisions, reports the Nikkei.
The group has doubled down on its internal carbon pricing initiative, a practice of putting a price on emissions by equipment, and raised the rate to $127 per ton from the previous $45.
Image and content: Bloomberg/Nikkei Asian Review