Climate Change

Energy efficiency: a bright way to power up your savings!

From NZ Manufacturer magazine March 2025 www.nzmanufacturer.co.nz NZ Manufacturer March 25 by Media Hawkes Bay Limited – Issuu -Insa Errey, Advisor to NZ Manufacturer, Genesis, Senior Manager Future Fuels. Energy efficiency is increasingly becoming a key factor to drive cost reductions, especially in the manufacturing sector. As manufacturers seek ways to remain competitive and reduce operational expenses, energy costs should become the primary target for cost-cutting measures. By improving how energy is used, it can reduce bills, boost productivity, and contribute to long-term sustainability. The Link Between Energy Efficiency and Costs In manufacturing energy cost can account for up to 20% of total operational expenses, these costs can vary depending on the industry and the energy intensity of the product. Energy costs, in many cases, are second only to labour in terms of operational spending. Leading to improving energy efficiency delivering substantial financial benefits. Energy efficiency involves the reduction of energy consumption without compromising output or quality. The savings generated from these measures can translate directly into reduced operational costs and higher profit margins. Significant savings can be realised with low to no cost process optimisation. While other opportunities may involve initial investment which can seem significant, the return on investment (ROI) is often reached quickly through reduced energy costs. Global insights from the International Energy Agency (IEA) show that in some industries, energy efficiency projects can pay for themselves in as little as 2-3 years. Beyond immediate savings, energy efficiency improvements can provide long-term financial benefits. Energy efficiency can help mitigate the impact of rising energy prices, making it easier for manufacturers to predict future costs and avoid unexpected increases in energy expenses. Even small reductions in energy costs can make a big difference to the bottom line. Another consideration is that energy efficiency can also provide […]

How well are NZ companies reporting their climate impacts?

(Left)Sarah Walton, Professor of Sustainable Business, University of Otago (Right)Andrea Foley, Assistant research fellow, University of Otago Interpreting corporate reports on carbon emissions can be challenging. The current, adhoc approach to how businesses share this information makes it difficult to see whether they have set the right targets, have realistic plans to meet them or are being transparent about their progress. While there are frameworks for reporting climate and sustainability data, there are still big differences in the way the data is being disclosed. We developed the Climate Action Tracker Aotearoa (CATA) to address these issues. Based on the global Net Zero Tracker, CATA evaluates company reports and climate plans to share and explain their climate action. Using the tracker, we analysed 21 companies in Aotearoa New Zealand, focusing on the top emitters and companies in the energy, retail, agriculture and transport sectors, as well as the banking sector. We evaluated three aspects – targets, plans and reporting – by reading through publicly available information provided by the company. These three aspects help make sense of what a company is doing and going to do to mitigate climate change. Here is what we found. Setting targets While the majority of companies have 2030 targets (86%) and absolute targets (81%), only five companies of the 21 (25%) have targets that have been verified by the Science-based Targets Initiative. All but two companies include scope one (emissions the company creates directly) and scope two (emissions created indirectly from, for example electricity or energy it buys for heating and cooling buildings) – the areas companies have the most control and ownership over. But when it comes to scope three emissions, which come from company travel in planes, trains and taxis, and the supply chain, far fewer companies have set such targets. Scope three targets are […]

Reducing manufacturing emissions

Hon Andrew Bayly, Minister of Manufacturing Manufacturing is a significant sector for New Zealand. It employs 230,000 people and accounts for nearly 10 per cent of GDP and 60 per cent of exports. I often describe it as a “sleeping giant” for New Zealand’s economy, because its significance is not well understood. When I travel around the country promoting the manufacturing sector, one of the things I often remind people is that a career in manufacturing is a career in a highly advanced, technical field. A lesser-known fact is that approximately a quarter of all New Zealand’s business-led research and development comes from the manufacturing sector, meaning manufacturing is a key driver of innovation. However, to support this innovation, manufacturers need the right tools and resources. I know from talking to manufacturers that access to information and expert guidance on how to upskill and improve productivity is challenging. Which is why I was delighted to recently launch a set of tools to help empower manufacturers to grow their business and reduce their emissions. Emissions and waste mapping The first is a report that identifies and maps the manufacturing sector’s emissions and waste patterns. Titled ‘Mapping Emissions and Waste Stream Profiles, and Opportunities for Achieving Net-Zero Circular Advanced Manufacturing’, the report is based on waste and emissions data from 2019 (the most recent data available). It provides a comprehensive picture of waste, emissions, and opportunities to improve sustainability across the seven main manufacturing subsectors: food and beverage, machinery and equipment, other manufacturing, metal and metal products, chemicals and refining, wood and paper, and plastics and rubber. The report details challenges and opportunities for the sector with a goal of helping manufacturers identify opportunities to adopt low-emissions technology and increase circular manufacturing practices which, in turn, will help us reduce our […]

The Scope 3 ripple effect

From June issue, NZ Manufacturer magazine. -Insa Errey In the ever-evolving landscape of regulations, New Zealand manufactures find themselves connected to the regulatory frameworks of key trading partners such as the European Union (EU). The EU has positioned itself as a global leader in climate action, with ambitious targets set under the European Green Deal and the European Climate Law. As part of its efforts to reduce greenhouse gas emissions, the EU has implemented regulations on Scope 3 emissions reporting through directives such as the Non-Financial Reporting Directive (NFRD) and the EU Taxonomy Regulation. Understanding the impacts of Scope 3 regulations in these markets is crucial for New Zealand manufacturing. Let’s delve into how regulations in the EU can shape the strategies and operations of New Zealand manufacturers. First what is Scope 3? Scope 3 emissions refer to indirect greenhouse gas emissions that occur in the value chain of a company, including both upstream and downstream activities. These emissions often result from activities such as the production of purchased goods and services, transportation and distribution, and waste disposal. For any EU customer this may just be your manufacturing sites Scope 1 or 2 emissions. Meaning the emissions your site emits from use of direct combustion (scope 1) or indirect emissions on site from purchased electricity (scope 2). What does this mean for NZ manufacturers? Market Access and compliance pressure to adhere to these standards is required for exporting to the EU which governs Scope 3 emissions disclosure and reduction. Failure to meet these requirements can result in barriers to market entry. In a global market increasingly, prioritising emissions reduction is becoming an advantage, as exporters can face competition from countries with lower carbon footprints. Failure to manage or measure emissions can put NZ manufacturers at a competitive disadvantage and could […]

The scope 3 ripple effect

-Insa Errey In the ever-evolving landscape of regulations, New Zealand manufactures find themselves connected to the regulatory frameworks of key trading partners such as the European Union (EU). The EU has positioned itself as a global leader in climate action, with ambitious targets set under the European Green Deal and the European Climate Law. As part of its efforts to reduce greenhouse gas emissions, the EU has implemented regulations on Scope 3 emissions reporting through directives such as the Non-Financial Reporting Directive (NFRD) and the EU Taxonomy Regulation. Understanding the impacts of Scope 3 regulations in these markets is crucial for New Zealand manufacturing. Let’s delve into how regulations in the EU can shape the strategies and operations of New Zealand manufacturers. First, what is Scope 3? Scope 3 emissions refer to indirect greenhouse gas emissions that occur in the value chain of a company, including both upstream and downstream activities. These emissions often result from activities such as the production of purchased goods and services, transportation and distribution, and waste disposal. For any EU customer this may just be your manufacturing sites Scope 1 or 2 emissions. Meaning the emissions your site emits from use of direct combustion (scope 1) or indirect emissions on site from purchased electricity (scope 2). What does this mean for NZ manufacturers? Market Access and compliance pressure to adhere to these standards is required for exporting to the EU which governs Scope 3 emissions disclosure and reduction. Failure to meet these requirements can result in barriers to market entry. In a global market increasingly, prioritising emissions reduction is becoming an advantage, as exporters can face competition from countries with lower carbon footprints. Failure to manage or measure emissions can put NZ manufacturers at a competitive disadvantage and could impact market share. Even if you […]

What is net zero?

Net zero is an ideal state where the amount of greenhouse gases (GHGs) released into the earth’s atmosphere is balanced by the amount of GHGs removed. Decarbonisation efforts are needed to reach net zero. If you follow sustainability and climate topics, you have probably heard the term net zero thrown around. Still puzzled? A net-zero gain of GHG in the atmosphere is achieved when the level of GHG emissions released into the atmosphere is equal to the amount removed. This is also referred to as carbon neutrality. CO2 is a gas found in the Earth’s atmosphere—and it’s part of the planet’s air, along with nitrogen, oxygen, methane, and other gases. CO2 helps to trap heat, but too much of it can cause problems, such as heat waves or flooding. It occurs both naturally and as a byproduct of human activities such as burning fossil fuels. All industries—not just the energy sector—must achieve net zero to avoid a permanently warmer planet. Read on to learn more about what net zero means, and how it can be achieved. What is decarbonisation? Decarbonisation is the mitigation, cessation, or reduction of carbon in the atmosphere. It is achieved by switching to energy sources or materials that emit less carbon, often from high carbon-emitting fossil fuels and by counteracting any carbon that is emitted. Keeping global warming to 1.5°C above preindustrial levels by limiting the buildup of atmospheric GHGs will be necessary to prevent permanent warming of the planet and catastrophic consequences. Those efforts are referred to as decarbonisation. Many companies, countries, and organisations have pledged to decarbonise, or to make the net-zero transition, in the coming years. The power, oil and gas, and transport industries are frequently cited as the biggest emitters, but all industries need to work toward decarbonisation to achieve net zero. Getting to net zero is most significant […]

Serious about reducing your carbon footprint? (Part two)

From NZ Manufacturer, October 2023. This month we get to the ‘pointy end’ of things. Using the concepts she explained in last month’s article, Nicky Andrews, Head of Carbon at thinkstep-anz, explains how to measure and reduce your carbon. But first, a recap. Where we left off: identifying the main sources of your carbon emissions So you’ve taken the first step. You’ve split your greenhouse gas emissions into direct emissions (Scope 1), indirect emissions (Scope 2) and the hidden indirect emissions in your value chain (Scope 3). Now you’re ready to measure them. Step two: measure your emissions Your Scope 1 and 2 activities Measuring your Scope 1 and 2 emissions is relatively simple. You’ll need two pieces of data: the volume of emissions your activities create (‘your activities’) and the impact those emissions have on the environment (‘emission factors’). First, confirm your activities. For example, how many kilometres did your employees drive in your company vehicles last year? How many kilowatt hours of electricity powered your plant? You’ll have much of this information to hand in documents like monthly fuel and power bills. Second, find your emission factors. An emission factor represents the amount of GHG an activity releases. The Ministry for the Environment (MfE) provides generic information factors, along with helpful workbooks and guides. For example, according to MfE, one litre of diesel used for transport emits 2.69 kg of CO2 equivalent. Third, do the maths. Units of activity x emission factor per unit = CO2e released. Your Scope 3 emissions These are the emissions in your value chain. They sit with your employees, suppliers and customers. Here’s an example of measuring the carbon in your supply chain. Say you want to estimate the emissions in Scope 3 Category 4 (upstream transport). Ask your suppliers: How much fuel […]

Carbon emissions on the way down

Robert McLachlan, Professor in Applied Mathematics, Massey University. Ian Mason, Adjunct Senior Fellow in Renewable Energy Systems Engineering, University of Canterbury. It may have been largely overlooked in the election debates, but New Zealand’s greenhouse gas emissions are finally on the way down. Annual emissions of carbon dioxide from the burning of fossil fuels are the lowest since 1999 and the 12-month renewable share of electricity is back above 90% for the first time since 1981. The Ministry for the Environment has advised New Zealand is on track to meet the first (2022-2025) carbon budget. All this can be attributed to a range of factors, including fossil gas running low, full hydro lakes, high petrol prices and working from home. But climate policies such as the Emissions Trading Scheme (NZ ETS), the clean car discount and the Climate Emergency Response Fund (CERF) have made a significant contribution to the turnaround. Current decarbonisation policies have and will continue to deliver real emissions cuts, provided they remain in place. It is therefore disconcerting that the National Party plans to take $2.3 billion from the CERF (almost two-thirds of the fund’s mid-2022 balance) to pay for tax cuts. The argument that individual households will use tax cuts to make their own decarbonisation decisions is unsupported by evidence and lacks credibility. The Labour Party has also dipped into this fund, taking $236 million to pay for rebates for household installations of solar panels and batteries, and community energy schemes. These may produce some as yet unquantified emissions cuts. Government funding is working Allocations from the Government Investment in Decarbonising Industry (GIDI) fund to NZ Steel and Fonterra show direct and measurable avoidance of emissions. The installation of an electric furnace at NZ Steel to utilise scrap will save 1% (800,000 tonnes of CO₂-equivalent emissions, or tCO₂e) of New Zealand’s 2021 gross emissions. Support for Fonterra […]

Serious about reducing your carbon footprint? Read on!

Chances are you’re already talking about carbon – and climate change too. If not, you need to start! But when you’re a busy manufacturer, getting to grips with carbon can be daunting, we know. So in this first of two articles, Head of Carbon at thinkstep-anz Nicky Andrews explains how to get started and keep making progress. Nicky Andrews, thinkstep-anz Head of Carbon. Understanding carbon emissions What are carbon emissions? ‘Carbon emissions’ is shorthand for ‘greenhouse gas emissions’ (GHGs) – the gases that are trapping heat in Earth’s atmosphere and warming our planet. There are many types of GHGs. Common ones include carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O). Why do manufacturers need to reduce carbon emissions? You’ll be helping to keep global warming to below 1.5°C and meeting the goals of the Paris Agreement. There are many good business reasons, too, for manufacturers to tackle carbon. How does my business benefit from reducing emissions? First up, you’ll reduce your risks. For example, if the government introduces a carbon tax, you’ll be prepared. You’ll strengthen your brand. Customers may already be asking what you’re doing to reduce your emissions. That’s because they (and their customers) are increasingly seeking lower-carbon products. You’ll strengthen relationships. For example, you’ll keep your investors happy if you manage your emissions (and their money) carefully. Your team will value your efforts too. Many people want to work for a business that takes climate action seriously. Finally, because winkling out carbon involves delving into everything you do, you’ll spot opportunities to reduce your costs. What are the three Scopes (types) of emissions? The international Greenhouse Gas Protocol is one of the standards that govern how organisations measure and reduce their carbon emissions. The Protocol splits carbon into three groups (Scopes). Diagram of the Scopes: thinkstep-anz, […]

Ways to decarbonise heavy industry

Heavy industry in the world’s most advanced economies can become carbon neutral – if governments implement the right policies in the next five years. Chemical,steel, cement and other heavy industries are critical to everyday things we rely on, like vehicles, buildings and surgical supplies, the IEA explains. But producing these materials involves vast amounts of energy and heat. This means it’s harder for heavy industry to reach ‘net zero’ – carbon neutrality – with steel and cement producers facing particular challenges. What to do Set a clear direction Ambitious plans with clear targets should be developed for industry sectors by no later than the mid-2020s, backed by clear policies that promote innovative technologies and the efficient use of materials. Show industry what works Demonstration projects in different regions would show how industries can operate with near-zero CO2 emissions. Governments should be deciding in the next one to two years how to finance these and reduce any risk. At least two or three methods should demonstrate ways to produce both steel and cement with near-zero emissions, the IEA suggests. Finance innovation in heavy industry Grants, low interest loans and other types of finance could help fund the roll-out of near-zero emission technologies. Funding would help new and existing industrial plants and related areas like transport and storage. Boost demand for near-zero technologies Governments can help boost demand for materials made with near-zero emissions. This might include long-term support for first mover commercial plants in different technologies. Public sector procurement contracts that span a number of years are an example of government support. Work together An international industry decarbonisation alliance could include agreeing “concrete commitments” with the main aim to accelerate industry’s transition to net zero. Adjust measurement tools Carbon emissions from industry differ across plants, sectors and countries. For this reason, […]

1 2 3

News Ticker

Climate Change