Amazon meets renewable energy matching goal, launches supply chain decarbonisation resources

The e-commerce giant posted the news via its latest annual sustainability report today (10 July).

The report confirms that Amazon matched 100% of the electricity use across its global operations with renewable energy purchases. Its global estate of fulfilment centres, data centres, offices and grocery stores is rapidly expanding as demand for its retail and web services grow.

Amazon first committed to achieving this milestone in 2019 and initially set a 2030 deadline. It has therefore reached the target seven years ahead of schedule.

Amazon has approached renewable energy procurement through a mix of tariffs and power purchase agreements (PPAs), as well as on-site generation. Bloomberg NEF has classed Amazon as the world’s largest corporate renewable energy purchaser for four consecutive years.

Between PPAs and onsite arrays, Amazon is supporting more than 500 renewable energy projects. It has added or enabled new wind and solar projects in 27 nations since 2019 including utility-scale arrays in India, Greece, Japan, South Africa, Indonesia, China, the US and the Netherlands.

Looking to the future, Amazon stated that the path to maintaining 100% renewable electricity for operational demands “is changing in ways that no one quite anticipated even just a few years ago – driven largely by the increasing demand for generative artificial intelligence (AI)”.

The energy required to run global AI services is anticipated to grow at least 25% each year in the 2020s. And generative AI is particularly energy-hungry, with some estimating that it uses up to 33 times more energy than a machine running basic task-specific software.

Google recently published its own annual environmental report, posting a 37% increase in power-related emissions partly attributable to expanded data centres supporting AI.

This raises questions about how corporates in the digital economy will need to re-assess how they approach growth, modernisation and decarbonising in line with long-term net-zero goals.

Amazon has stated that it will continue investing “heavily” to add “substantial” amounts of additional renewable generation capacity to its portfolio. However, it will “need to be nimble” and will Explore new carbon-free energy sources that can complement renewables and balance our needs”.

As well as financing new renewable generation, Amazon has been assessing how best it can support governments, regulators and networks in improving grid infrastructure. Modernisation is needed in many developed nations, while, in developing regions still dependent on fossil fuels, the focus needs to be on universal energy access and letting low-carbon generation come online, per the IEA’s recommendations.

Supply chain emissions

As is the case for most large multinationals, the bulk of Amazon’s total emissions footprint arises from Scope 3 (indirect) sources including its supply chain.

Amazon generated nearly 52 million tonnes of Scope 3 emissions in 2023 compared to around 17 million tonnes through its operations and electricity purchases.

Suppliers, especially SMEs, tend to struggle with decarbonisation due to barriers such as a lack of internal expertise and lower budgets than their corporate clients.

Amazon has therefore made all of its guidelines, playbooks, science-based modelling and other decarbonisation resources freely available publicly through a new ‘Sustainability Exchange’. Suppliers will benefit from the resources as well as other companies.

The Exchange walks users through measuring carbon baselines and reporting emissions data; developing and implementing a renewable energy procurement strategy; improving building energy efficiency and taking the first steps towards a robust water stewardship strategy. It also includes resources on decarbonising transport, cutting waste, carbon offsetting and embedding human rights principles in the low-carbon transition.

Amazon’s VP for worldwide sustainability Kara Hurst said: “We want to empower companies across all industries, of all sizes—from small businesses, to large multi-national organisations, and global companies—to take steps to decarbonize and develop sustainable operations, regardless of where they are in their sustainability journey.

“Over time, the platform will be updated, and expand with new content and resources to meet the varying needs of suppliers. Our hope is that the Exchange becomes a platform widely used and adopted by industry peers.”

Some larger, higher-emitting Amazon suppliers will be required to do more than simply access the Exchange. Amazon has identified a list of its highest-emitting suppliers, collectively responsible for more than half of the firm’s Scope 3 footprint. They will be required to provide a plan for decarbonisation and demonstrate “real progress” in annual updates.

Amazon will additionally set out expectations for future strategic suppliers to “aggressively decarbonise their operations over time”.

Amazon has set a 2040 net-zero target covering all emissions scopes. Its absolute emissions across the value chain were down 3% year-on-year in 2023.

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Comments (1)

  1. Richard Phillips says:

    Whatever happened to nuclear energy??
    And even to fusion energy?
    More reliable than wind or solar!
    I am under the impression that it all became just “business”, but I could be wrong, I usually am!

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