Strong and widespread industrialization after the industrial revolution heavily depended on the fossil fuels including coal, oil and natural that increased Green House Gas (GHG -mainly CO2) in the atmosphere. As a result of increased concentration of GHG average temperatures increase causing climate change. Climate change and environmental degradation are an existential threat to humans. In order to address the climate change risks, two economic blocks announced their plan: The Green Deal by European Commission and the Green New Deal by USA.
The European Green Deal aims to transform the EU into a modern, resource-efficient and competitive economy by:
0 emissions of GHG by 2050
decoupling economic growth from resource use
homonigizing life throughout Europe including every person and every place
The European Green Deal has a seven-year €1.8 trillion budget to finance this transformative plan. The European Commission has adopted a set of proposals to make the EU's climate, energy, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels.
Major sectors that are targeted with this program include energy, industry, transportation and buildings. The energy strategy aims to increase the share of renewables in electricity generation. In January 2023 an important milestone was achieved towards this goal: more than 50% of electricity generation in EU was from renewable sources including wind and solar. The industrial strategy aims to reduce material dependency by using the principles of circular economy, increase energy efficiency and eliminate waste using innovative technologies and sustainable supply chain management principles. Industrial transformation strategy is termed as ‘the twin green and digital transitions for Europe to become globally more competitive’. Transportation strategy envisions transition to electromobility and active mobility in cities while Hydrogen is used for long-haul logistics activities. Transitioning vehicles from internal combustion engines that emit GHG to EV is considered the best solution for urban areas since electricity generation in EU is relying more and more on renewable resources. Energy efficient buildings not only during the occupancy of these buildings but also during their construction.
USA has a similar strategy to the EU’s Green Deal that aims to obtain net zero GHG emissions by 2050.
In order to calculate the GHG emission in end-to-end supply chains, a holistic perspective is needed covering all of the stages and functions. The emissions are related to operation of Supply Chains that result in regular GHS emissions for each procurement/production/distribution activity. In general, each activity in the end-to-end supply chain results in GHG emissions. Procurement activities has to consider not only the purchase price of the raw materials and parts but also GHG emissions per item procured (for example, on the average 2 kgs of CO2 is emitted per kg of aluminum), the emissions due to inbound logistics activities and inventory related emissions. Production activities generally related to energy use; however some sectors emit GHG during their operations such as cement industry during calcination. Distribution activities are mainly transportation related emissions such as road, rail, sea or air transportation.
Prof.Dr. Metin Türkay, Founder of SmartOpt