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Decarbonising our supply chain and natural gas wholesales

By 2040, we aim to have net-zero emissions across our entire value chain.

We already have a plan in place for gradually phasing out natural gas from our business operations and we are now working to reduce emissions in our supply chain.

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What are we doing?
How are we doing?
Latest updates from 2023
Key information

Why are we focusing on supply chain decarbonisation?  


At Ørsted, we have the most progressive decarbonisation targets in the energy sector, and we aim to reach net-zero greenhouse gas emissions across our whole value chain (scope 1-3) by 2040. Find out how we reduce our scope 3 emissions – those that come from our supply chain and the use of the natural gas we sell.

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We need to find ways to decouple the growth of our build-out from the growth of emissions in our supply chains.  


We’re gradually phasing out natural gas sales from our business portfolio. This will eliminate the vast majority of our scope 3 emissions. But it still leaves emissions linked to our supply chain, including those from the manufacture, installation, and transportation of our renewable energy assets – activities that all need to grow as we accelerate the built-out of green energy.  

This makes supply chain decarbonisation one of the most important and complex parts of our work to reach net-zero. 

What are we doing? 


In this area, there are no competitors, only partners. Supply chain emissions are beyond our direct control, and many of them come from hard-to-abate sectors like shipping, steel, and heavy manufacturing. Our success depends on succeeding with others.  

Our work on supply chain decarbonisation focuses on three areas.


  1. Tracking and measuring carbon progress by developing models for life cycle assessments (LCAs): We use the models to calculate the total carbon footprint of our new offshore wind farms and will develop them to cover onshore wind and solar PV technologies as well as the more recent technologies in our portfolio. We also contribute to the development of standardised LCA metrics to increase transparency and comparability of data.

  2. Engaging with suppliers on integrating decarbonisation strategies in their operations: We engage with key suppliers from some of the most carbon-intensive segments of our supply chains. Our aim is for them to adopt science-based targets, conduct transparent climate reporting to CDP, and use renewable electricity in the manufacturing of products for Ørsted.

  3. Entering into offtake agreements for low-emission products essential to the green energy transition: We contribute towards the scaling of new technologies by reducing uncertainties for suppliers and further incentivising their investments in low-emission technologies.

How are we doing? 


We track our scope 3 greenhouse gas emissions, including and excluding gas sales. Each measure has a different science-based target. 

Reduction in GHG intensity (scope 1-3) (g CO2e/kWh, base year 2018) – excluding gas sales

Reduction in GHG emissions (scope 3 –gas sales) (Mt CO2e, base year 2018)

Latest updates from 2023 

  • We procured low-carbon copper for the export cable scope for Hornsea 3 in the UK, which will become the world's largest wind farm. In doing so, we reduced the emissions from the export cable scope by around 50 %.

  • We formed an industry-leading partnership with wind turbine supplier Vestas, including an early offtake agreement. We pledged to procure 25 % low-emission steel turbine towers for all joint projects, and when available blades made with recycled materials.

  • We signed a long-term large-scale supply agreement with Dillinger, our key steel manufacturer for foundations, which in part has enabled Dillinger to invest in a low-emission steel production route (DRI-EAF). This investment will reduce Dillinger’s company emissions by 55 % in 2030.

  • To increase the collective demand signal for near-zero steel, we joined the First Mover Coalition’s Near-Zero Steel 2030 Challenge. The initiative aims to accelerate investments in near-zero steel by mapping suppliers’ and companies' existing plans and connecting buyers with future suppliers of near-zero steel. 

  • Together with the Carbon Trust and eleven other energy developers, we launched a programme to develop the first industry-backed method for calculating the life cycle carbon footprint of offshore wind farms. This common methodology will help increase transparency for governments, investors, and suppliers and enable comparability of data.

  • We began integrating our climate expectations into key supplier contracts, including requiring CDP reporting, science-based targets, and the use of 100 % renewable electricity. This applies to suppliers in a number of high-impact categories, which contribute significantly to our supply chain GHG emissions.


What’s next? 

We will continue to develop tools to support our suppliers in their green transformations as we enhance sustainability in our sourcing processes. We will also start engaging with suppliers on biodiversity, circularity, the carbon footprint of their products, and the climate engagement of their own supply chains.

Key information 


Partnerships

  • First Movers Coalition: Drive market demand for technologies key to decarbonising our supply chain (steel and concrete) 
  • SteelZero: Drive market demand for low-carbon steel and develop shared global policy frameworks and standards for low-carbon steel 
  • Salzgitter AG: Scale the production of renewable hydrogen for the steel industry and direct scrap steel from decommissioned assets to build new offshore wind farms 
  • Green Fuels for Denmark: Scale production of green fuels for heavy transport and aviation 
  • 1.5 °C Supply Chain Leaders Exponential Roadmap Initiative: Drive leading climate action of global supply chains together with other sustainability leaders, such as IKEA and Unilever 
  • The Carbon Trust 


International frameworks 

  • SteelZero   


Governance 

Accountability lies with our Head of Global Stakeholder Relations and Chief Operating Officer. The programme is anchored in a steering committee with broad representation from the business.  


These efforts contribute towards the following Sustainable Development Goal: 

Suppliers share their decarbonisation journeys

Decarbonising with Siemens Gamesa

Jonas Pagh Jensen: “Supply chain collaboration can mobilise change”

Decarbonising with Van Oord

Theo De Lange: “We must all embed sustainability into our procurement processes”

Decarbonising with Bladt Industries

Anders Søe-Jensen: “Low-cost green steel requires everyone to step up”
Our sustainability efforts

Decarbonising our energy generation and operations

We have the most progressive decarbonisation targets in the energy sector

Read more