Anglian Water has given its suppliers until 31 March 2009 to calculate their carbon footprints and develop climate change mitigation and adaptation strategies. It says it will use the information to inform future purchasing decisions.
"We will be seeking suppliers who are making the same commitment as ourselves to adaptation and reduction in carbon emissions," said Nirmal Kotecha, Anglian’s head of supply chain management. "We will be asking more questions and will start scoring accordingly."
The policy was discussed at a climate change summit in January to which Anglian invited its 50 top suppliers. It wants to work with its supply chain to strengthen its resilience to climate change.
Anglian’s energy use has doubled over the past 15 years, largely as a result of tighter treatment standards for drinking water and sewage treatment. It now aims to reduce its energy use by 9% by 2010 and cut its carbon footprint by 60% by 2050.
Anglian and other water firms will have a financial incentive to cut emissions when the government’s Carbon Reduction Commitment is introduced in 2010 (ENDS Report 390, pp 41-43 ). The firm expects to spend £5-10 million a year on emissions allowances, although most of this will be returned at the end of the year.
Climate change will introduce other problems. The firm expects it will reduce water availability by 5% in its already drought-prone region and fears the effects of more flash flooding, rising sea levels and an eroding coastline on its treatment plants and sewer systems. On top of this, it will have to accommodate one of the UK’s largest house-building programmes, with more than half-a-million new homes planned for the next 25 years.
Anglian’s ability to cope with climate change will depend heavily on its suppliers. It spends more than 60% of its turnover on goods and services. Approximately 50 of its suppliers would have to be up and running within two weeks of a major crisis. This includes some that would need to be functioning within 30 minutes to avoid interruptions to its services.
The January summit included presentations on climate change and carbon footprinting and Anglian asked the 100 or so delegates to make their own additional pledges. Some 500 were elicited, ranging from meeting Anglian’s footprinting goal early to employee education programmes and reducing the mileage of sales staff.
However, most suppliers are set for a steep learning curve. Only 22 had responded to a questionnaire sent before the meeting to assess whether they had begun to deal with their emissions. Sixteen included some data, but just seven had worked out their carbon footprint.
Most delegates were positive, saying the meeting was helpful. However, a few said they resented being press-ganged into attending and doubted whether Anglian’s buying decisions would change.
Anglian has yet to outline exactly how it will score suppliers in the context of the other variables it considers when buying goods and services.
However, the firm’s plans should be made easier by proposals to include greenhouse gas emissions data in the Achilles utilities vendor database. This is a centralised system for collecting and comparing information on suppliers created for water and power suppliers by Norwegian supply chain management firm Achilles (ENDS Report 379, p 23 ).
Anglian is part of the small team of firms that is helping to develop a greenhouse gas reporting protocol for the system with the help of the Carbon Trust. It should be ready in the spring and will give suppliers feedback on their emissions relative to the rest of their sector.