Initiative boosts net zero ambitions of big pharma
Big pharma net zero ambitions have been boosted by a major initiative that aims to drive positive climate action throughout global value chains.
Big pharma net zero activities are being supported by the Energize programme, a collaboration between 10 global pharmaceutical companies, to engage hundreds of suppliers in climate action and decarbonization of the pharmaceutical value chain.
Healthcare delivery contributes 4.4% of global carbon emissions. Healthcare systems and their supply chains are both part of the challenge and the solution, having a key role to play in supporting the response to climate change.
The Energize program, supported by Schneider Electric and Carnstone, aims to leverage the scale of a single industry’s global supply chain in a pre-competitive fashion to drive big pharma net zero and system-level change. Creating life-saving medicines and services requires a lot of energy, much of it being used by the value chain. By proactively engaging with their suppliers to create renewable energy opportunities, the 10 convening companies are taking meaningful action to collectively address their energy usage and inspire other industry sectors to follow suit.
The program will help pharmaceutical and healthcare suppliers to address their own operational Scope 2 greenhouse gas emissions through green power procurement, which in turn will reduce the participating companies’ Scope 3 emissions. The program will be designed and delivered by Schneider Electric; the pharmaceutical companies will promote the program collectively, and individually invite their suppliers to participate in the big pharma net zero initiative.
The program will enable pharmaceutical suppliers to learn more about renewable energy adoption and contracting. In practice, this will mean giving suppliers – who may not otherwise have the internal resources or expertise available – the opportunity to participate in the market for power purchase agreements (PPAs).
“We believe Energize will be a really effective collaboration of pharmaceutical companies looking to take bold climate action. Every business should be moving aggressively towards using 100% renewable electricity, and supporting their supply chains to do the same,” said Sam Kimmins, Head of RE100, Climate Group.
Renewable energy procurement can be challenging for companies of all sizes for a variety of reasons. The Energize program is designed to overcome typical market barriers such as inadequate knowledge about renewable energy transactions, load size, lack of credit, and the need for guidance throughout a complex and protracted contracting process.
Participating suppliers will learn about the renewable energy market, receive guidance on PPAs, and have the opportunity to access and contract for renewable energy on their own or as part of a collaborative buyers’ cohort to support big pharma net zero ambitions.
The program will initially focus on suppliers with energy load in Europe and North America, with the intention to expand globally where interest and renewable energy market opportunity align.
Britain’s NHS is contributing to big pharma net zero targets having already set out an ambitious plan to become the world’s first Net Zero National Health Service. The NHS estimates that the use of medicines accounts for 25% of total emissions from the health service and says it is deeply committed to supporting this goal; with companies taking global action to reduce their environmental impact.
With 62% of the NHS Carbon Footprint Plus based within its global supply chain, there is an opportunity for suppliers around the world to demonstrate their commitment to the health of their employees, their customers, and the wider community, by working in collaboration with the NHS to decarbonise operations in line with this target.
Big pharma net zero ambitions will require strong leadership, bold commitments, and a clear roadmap with intermediate targets. But it is critical if healthcare industries are to support a healthier planet and healthier people.
