IKEA (China)

At a Glance

Industry

Retail

Project Types

Clean and Renewable Energy, Engagement and Behavior Change, Supply Chain

Year

2018

Location

Shenzen, China

Summary

Ming Cheng identified opportunities for IKEA suppliers to increase their energy generation from renewable sources.

Goals

As part of its sustainability strategy, People & Planet Positive, IKEA is finding ways to reduce the carbon emissions of its footprint. EDF Climate Corps fellow Ming Cheng was enlisted to identify opportunities for suppliers to invest in renewable energy, including researching the relevant government policies and trend, identifying various options for implementing and understanding suppliers’ concerns and motives towards renewable energy projects. Cheng was to focus on IKEA’s high energy-demand category area: Metal, Plastic and Float glass.

Solutions

Cheng focused on ten suppliers within the Metal, Plastic & Float Glass category area. After identifying their energy source profile and percent of renewable energy generation, it became clear that there was big potential in transitioning to renewable energy as their primary energy source. However, at this point, no actions were being take on electricity de-carbonization. So, to improve communication with suppliers, Cheng provided IKEA with information on suppliers’ concerns and motives around renewable energy projects.

She also created a user-friendly solar calculation tool that shows the financial return of potential solar projects. Data from four suppliers was collected in order to test the accuracy of the tool.

Finally, Cheng researched and identified existing and emerging renewable energy options, including conventional on-site generation, as well as Green Certificates and direct power purchase agreement with renewable power plants. This offers the suppliers with more diverse options regarding project type.

Potential Impact

IKEA suppliers are now better informed around the various renewable options open to them, including specific information on investment scale, local availability and government policy. IKEA has a better understanding of the opportunities out there for its suppliers, enabling it to better communicate, promote and engage with each supplier, not to mention achieve its sustainability goals.


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