Shanghai Minhang Development Zone Survey: How Manufacturing Enterprises Balance Benefits and Environmental Protection
The manufacturing industry has high carbon emissions and affects upstream and downstream industries, which is an important position for energy conservation and carbon reduction. Among them, the equipment manufacturing industry has low energy demand and low consumption intensity, which can provide technical and equipment support for the green development of other industries. So, how can manufacturing enterprises take the road of synergy between green and low-carbon economic development?
The joint research team of The Paper and the Shanghai Institute of Development Strategy "Approaching Zero Carbon" went to Shanghai Minhang Economic and Technological Development Zone (hereinafter referred to as "Minhang Development Zone"), which is dominated by advanced equipment manufacturing and other industries.
Minhang Development Zone is home to 21 Fortune 500 companies, about 90% of which are foreign-invested enterprises, and is the only industrial park in Shanghai's first batch of zero-carbon parks. The carbon emissions generated by the energy activities of enterprises in the park are the direct carbon dioxide emissions generated by the company's fossil fuels (coal, natural gas, gasoline, diesel, etc.), and the indirect carbon dioxide emissions generated by the company's purchased electricity and heat. At the end of 2015, the park completed clean energy substitution. At present, electricity accounts for about 80%, natural gas accounts for about 10%, and heat accounts for about 5% of the energy consumption structure of the park.
The key to energy conservation and carbon reduction for manufacturing enterprises is to reduce the electricity consumption in production. The position of manufacturing enterprises in the supply chain determines their importance to the coordinated carbon reduction of upstream and downstream enterprises. The research team visited the zero-carbon factories or green factories of four companies in the park, Michelin, ABB, Siemens and Mitsubishi Elevator, to gain an in-depth understanding of the practice and thinking of energy conservation and carbon reduction of manufacturing multinational enterprises.
The survey found that on the one hand, enterprises pay attention to energy-saving technological transformation in production through the upgrading and transformation of key energy-using equipment and process improvement, so as to reduce energy consumption from their own sources, and on the other hand, by selecting sustainable suppliers and considering the whole life cycle of products, they can drive the upstream and downstream of the supply chain and jointly reduce carbon emissions.
However, the green and low-carbon path still faces market and policy obstacles. For example, carbon emission accounting needs to be improved, and the cost pressure of "carbon neutrality" is greater. In this regard, in addition to improving policies, regulations and standards, it is also necessary to enhance the awareness of "people", and it is necessary to make green and low-carbon investment return, so as to arouse the endogenous motivation of enterprises and employees with economic and social benefits.
bearEnergy saving in production
How to minimize carbon emissions in the production process of manufacturing enterprises? The survey found that enterprises mainly adopt energy-saving technological transformation methods, and also achieve cost reduction and efficiency increase to a certain extent.
The first is to adjust and transform key energy-using equipment. Electricity accounts for 96% of the total carbon emissions of the Shanghai Mitsubishi Elevator Factory, and the annual electricity consumption of the factory reaches more than 4,000 kWh. From January 1, 2023, Shanghai will start to implement itNotice on Further Improving the Time-of-Use Electricity Price Mechanism in Shanghai, the general industrial and commercial electricity price adjustment, peak price increase, trough price reduction. Mitsubishi Elevator has calculated that if no changes are made, according to the new electricity price standard, the company's electricity cost will rise by more than 4 million yuan in 2023.
In order to alleviate the economic pressure of electricity consumption, Mitsubishi Elevator reduces energy costs from the aspect of production and manufacturing energy consumption control, and taps the energy potential of production equipment with large power consumption, such as air compressors and heat treatment heating furnaces, through reasonable scheduling. According to the latest estimates, the energy consumption per unit of output value has been reduced by 6% under the same output. At the same time, in order to achieve the optimization and control of energy efficiency, Mitsubishi Elevator implements informatization and digital transformation and upgrading of key energy-using equipment. In 2022, the company carried out the energy metering informatization transformation of the factory, uploaded all the meter data to the cloud, and dynamically managed the energy consumption. On this basis, carbon emissions are dynamically and accurately collected, monitored, and analyzed. For example, newer production lines tend to have better energy consumption and higher efficiency, and shop floor managers can give preference to them when scheduling production. This intelligent approach can not only assist production scheduling, but also easily convert energy costs to each workshop for sharing, so that energy saving is directly linked to cost reduction and efficiency increase.
Air conditioning is also the largest energy consumption in factories. In the Shanghai large motor factory of ABB High Voltage Motor Co., Ltd., workers are busy bandaging the insulating mica tape for bare copper wire, which is the core technology in the production of large motors, which is directly related to the final quality and service life of the product. Since mica is sensitive to the environment, the factory floor must be kept at a constant temperature and humidity throughout the year. Here, air conditioning accounts for more than 70% of the overall production energy consumption. In order to reduce energy consumption, ABB uses a combination of air conditioners and industrial fans in all other workshops, except for the coil manufacturing workshop. In the small motor factory of Shanghai ABB Motor Co., Ltd., an induction roller shutter door for frequent entry and exit of logistics has replaced the door that used to be opened all day, and the energy consumption of air conditioning has been greatly reduced.
ABB large motor embedding process
Since 2003, ABB, which has built a factory in Minhang Development Zone, has upgraded its 20-year-old plant and equipment and facilities to further save energy and reduce consumption. In terms of production line transformation, due to the increasing market demand for customized motors, the operators who produce such products are close to each other, and the lengthy production lines and automatic conveyor belts that used to meet mass production are no longer suitable and need to be remodified. After the transformation, a production line can save nearly 200,000 yuan in electricity bills a year, and this model is expected to be replicated in more production lines in the future. In terms of equipment upgrades, the company gradually changed the air conditioning air compressor to an inverter type, and replaced the motor with ABB's self-produced equipment.
The second is process improvement. "It is also the most economical and effective to promote energy conservation and carbon reduction from the source of product process design. Xie Yili, director of environmental energy of Shanghai Mitsubishi Elevator, said. In the past, in order to make the stainless steel door and car wall of the elevator meet the national standard for impact strength, glue was often used to bond the stiffeners behind the plate. But the use of glue not only has an impact on the environment, drying the glue also consumes energy. After the process is improved, the use of laser welding technology can not only solve the above problems, but also save labor costs. Although it costs more than 5 million yuan to invest in a production line, the input cost can be covered by other income within 2 years. As a result, the innovative replacement of more than ten years of traditional processes from the source can solve the "impossible triangle" between low-carbon environmental protection, cost and quality in manufacturing.
Mitsubishi Elevator automatic laser welding equipment
Decarbonization of the supply chain
To develop green and low-carbon, from the perspective of the position of manufacturing enterprises in the supply chain, it is also necessary to drive the collaborative innovation of upstream suppliers, manufacturers, logistics service providers and downstream retailers in the supply chain through leading enterprises, so as to ultimately reduce the carbon emissions of the whole life cycle of products.
The first is to choose sustainable suppliers.
ABB's electric motor products are widely used in industrial fields such as power and new energy, chemicals, oil and gas, mining and cement, metals, papermaking, wastewater treatment, ships and port machinery. The production of these green products is also closely related to the carbon reduction work in related segments of the supply chain.
In recent years, ABB has updated 20%-30% of its supplier factories and eliminated relatively extensive suppliers. For existing suppliers, ABB helps them find ways to solve problems left over from the past, and for newly introduced suppliers, enterprises take sustainability factors as one of the audit requirements.
"Although the cost has risen, it is a better choice in terms of scale, quality control, and continuous efficiency. Luo Hui, head of ABB's Shanghai base in China's Motion Control Division, said, "Essentially, it's a sustainability issue. Brands must have their own competitive strategy, and green products are the core competitiveness. ”
The second is to consider the whole life cycle of the product.
"We continue to reduce the environmental impact of the whole life cycle of tires through technological upgrades, and advocate for customers and consumers to choose more environmentally friendly high-performance tires. Zhu Haiyan, general manager of Michelin's Shanghai factory, said. Michelin attaches more importance to the "green" of the whole life cycle of tires, including R&D, production, transportation, use and recycling of waste tires. For example, silica extracted from the ashes of burned rice husks is used in tire production through raw material substitution. Currently, nearly 30% of the tires produced at Michelin's Shanghai plant are made from sustainable materials, and the company aims to reach 100% by 2050.
Where does the motivation for enterprises to practice carbon reduction come from?
The direction of green and low-carbon development stems from the strategic positioning of the enterprise. The question of particular concern is, where does the motivation for enterprises to implement carbon reduction actions come from, and will the cost of carbon reduction affect the economic benefits of enterprises?
The first practice of enterprises is to improve people's internal motivation. Michelin publicizes data to enhance employees' awareness of green and low-carbon. On the large digital screen at the entrance of the Michelin tire factory in Shanghai, signs in the shape of "Christmas trees" represent environmental data such as carbon emissions and solar power generation, reminding and encouraging employees passing by every day. "The environment is the foundation of sustainable development, but people are the foundation of everything. Zhu Haiyan said that it is necessary to make people consciously agree with the concept of sustainable development.
The Michelin Group plans to reduce carbon emissions by 50% in 2030 compared to 2010 in the production and energy sectors, and to achieve carbon neutrality in the production, energy and transportation sectors by 2050. Today, Michelin's Shanghai plant has reduced its overall carbon emissions by 83% compared to 2010.
Display screen at the entrance of Michelin's Shanghai factory
ABB links carbon reduction with performance bonuses, which provides a direct incentive to practice green and low-carbon. ABB has directly linked green and low-carbon development to the performance of its managers, and has implemented it globally. Taking Luo Hui as an example, starting from the end of 2022, the weight of sustainable development improvement goals will account for 12.5% of his performance appraisal, while the sustainable development improvement goals of key managers will account for 7%-10% of the weight of performance appraisal, and for the part that is achieved and overachieved, he can receive a performance reward of up to 150%, which further stimulates employees' attention to sustainable development.
The biggest motivation is to invest in green and low-carbon returns. "In the process of combining production and low carbon, growth and energy efficiency go hand in hand. Dai Lijun, general manager of Shanghai Siemens Switch Co., Ltd., said. For enterprises, investing in automation and digital equipment can easily cost millions or tens of millions of yuan, and the return cycle is basically 3 to 5 years. Through equipment upgrades, the plant has reduced the number of plant personnel by 25%, doubled output, and reduced energy consumption per unit of output value.
Intelligent logistics distribution of materials in Siemens workshops
In short, long-term returns, such as economic and social benefits, are the actual factors that affect the power of energy conservation and carbon reduction of enterprises. In the long run, in addition to the economic cost reduction and efficiency increase of enterprises, more "green" products, more competitiveness and voice in the international market, and a responsible corporate image in the eyes of the public are all endogenous driving forces for enterprises to practice energy conservation and carbon reduction. The key to implementing it is "people", so that employees feel that green and low-carbon is not empty talk, but closely related to their own interests. As Zhu Haiyan said, people come first in order to balance environmental protection and economic benefits, and achieve sustainable development in terms of people, profits and the environment.
How far is it from green and low-carbon to carbon neutrality
To achieve the green and low-carbon transformation of the manufacturing industry, we need to focus on the system.
First of all, the process of investing in green and low-carbon enterprises faces practical obstacles. Taking ABB as an example, first, the annual equipment replacement should consider the impact of fixed investment depreciation rate and overhead rate on profits; second, there are natural limitations on the inherent load-bearing capacity and building layout of the old plant, and some renewal plans have to be compromised; third, the awareness and skills of employees should keep up with the speed of intelligent and automated iteration.
ABB's strategy is to further iterate equipment and optimize facilities if product sales increase by 5% and an additional 3% cost reduction through energy consumption and product cost reduction. Therefore, it is important not only to look at short-term investment data, but also to superimpose future competitiveness, with a payback period of 3 to 5 years, to see how much additional sales can be triggered by more advanced processes.
Secondly, the use of sustainable materials faces the problem of high pricing and difficulty in implementation. The survey found that only a few leading companies in the market are using, promoting and recycling sustainable materials, and there is no scale effect, so the price of raw material manufacturers is higher. If the government can introduce relevant support or subsidy policies to promote sustainable materials, enterprises can enjoy environmental dividends. For the government, it is necessary to assess whether the environmental protection investment is used for early emission reduction intervention or later pollution control. In addition, due to policy restrictions on market access, even if new materials appear, their application is slow. Relevant domestic policies, regulations and standards, if improved in a timely manner according to the latest technological development, can help enterprises open the first door to the application of new materials in the market.
We also found that carbon emissions, which is the key indicator that can best measure green and low-carbon development, need to be improved in terms of accounting methods and standards. First of all, we need to calculate our carbon emissions. Due to the lack of digitalization, intelligence and other technologies used by some enterprises, it is difficult to track the carbon emissions of the whole life cycle of products, which in turn affects the coordinated carbon reduction of the upstream and downstream of the supply chain. Second, for multinational companies, domestic and international carbon emission accounting standards need to be better aligned. Import and export enterprises face the same problem, because domestic standards such as carbon emission accounting and carbon footprint are not fully aligned with international standards, enterprises need to carry out a variety of accounting, which not only increases the cost of enterprises, but also affects the international recognition of the emission reduction effectiveness of Chinese enterprises.
There is a long way to go from green and low-carbon development to carbon neutrality. Carbon neutrality does not mean zero emissions, and can be called "carbon neutral" when the carbon emissions generated by an organization or product within a certain time or space range are equal to the emission reductions generated by external emission reduction technologies. Carbon neutrality can be achieved through the implementation of energy conservation and emission reduction projects by enterprises, or the direct purchase of corresponding environmental rights, and the use of photovoltaic power generation or green power trading is the main way to achieve carbon neutrality. At present, there are 18 enterprises in the Minhang Development ZonePhotovoltaic projectsThe annual photovoltaic power generation exceeds 13 million kilowatts, accounting for about 2% of the overall electricity consumption of the park. Enterprises also choose to use rooftop resources such as factories and parking sheds to build photovoltaics.
The survey found that the cost pressure on enterprises to achieve carbon neutrality is high. Taking Shanghai Mitsubishi Elevator as an example, even if all the roofs that can be used are covered with photovoltaics, the power generation can only meet 10% of the factory's energy demand, and the remaining 90% of the energy consumption must be carbon neutral through other means. In 2021, about 22,000 tons of carbon emissions were identified by the company. If all of them are offset by the purchase of green electricity, green certificates, etc., it will need to bear a high cost. Therefore, the first consideration is to save energy and reduce carbon emissions from the production side. "We first rationalize the internal production process to achieve high energy utilization, and actively plan the carbon neutrality path in advance. Xie Yili said.
Energy conservation and carbon reduction cannot be achieved overnight, and we must find ways to achieve a balance between environmental protection and economic benefits. The carbon reduction practice of multinational enterprises in the Minhang Development Zone shows us that in an international metropolis like Shanghai, despite the high cost of land and labor, the manufacturing industry can also take the road of coordinated development of energy conservation, carbon reduction, cost reduction and efficiency improvement. In the practice of green development, the improvement of energy-saving technology has promoted the technological innovation and technological leap of the entire industry. This shows that on the road to "double carbon", enterprises can not only maintain long-term economic interests, but also improve their technical level and production efficiency.
