How decarbonizing the renewable value chain supports multiple SDGs

At COP28, one of the most remarkable achievements was the agreement to triple global renewable energy installed capacity by 2030. This explosive growth is making more renewables companies aware of the environmental footprint of their value chain and the importance of accelerating emission reduction.

By 2050, under a net-zero scenario, renewable energy is expected to account for 90% of global power generation. According to the World Economic Forum’s research, if current carbon intensity levels remain, its full lifecycle carbon emissions will account for 60% of the entire power sector. It is imperative for us to decarbonize the renewable value chain from production and manufacturing to operations and end-of-life treatment as soon as possible.

We live in a time of multiple crises, and achieving sustainable development is far more than just a "carbon" issue. The rapid development of renewable energy presents new challenges and opportunities for this era, which allows us to simultaneously address issues of land protection, ecological restoration and biodiversity conservation, and promote employment and economic development. For example, from 2021 to 2060, the land area used for solar power projects in China is expected to increase 14 times, which poses new questions for agricultural land use and forest protection.

The sustainable development of renewable energy requires joint efforts along the value chain, including material suppliers, equipment manufacturers, project developers, operators and recycling companies. In particular, the role of champion companies is crucial. Through collaborative initiatives such as supplier enablement and end-of-life recycling, these industry leaders can showcase the best practices and maximize the net-zero, nature-positive and economic benefits throughout the entire lifecycle of renewable energy products.

For the sustainable development of renewable energy, each step on the value chain needs to identify their unique opportunities and take corresponding actions:

Renewable energy projects have a wide range of sustainability-enhanced approaches throughout their entire lifecycle, from cradle to grave. According to research by the World Economic Forum, prioritizing seven key levers by 2030 could achieve a 70% reduction in carbon emissions across the entire renewable energy value chain and create a global market opportunity worth of $2 trillion.

China plays a crucial role in the global renewable energy value chain. Chinese companies hold more than 70% of the global market share for renewables equipment manufacturing and over 60% for additional project development. These statistics place Chinese examples at the forefront globally and encourage more Chinese companies to recognize the significant opportunities of achieving the SDGs. Many existing practices are already pioneering this transition.

China is one of the countries with the largest areas affected by desertification, the most people impacted, and the most severe sandstorm hazards. “Solar power for sand control” has become an effective measure for controlling wind and sand in the most desertified areas in northern China. Renewable energy companies play a crucial role in promoting the scaling up and technological innovation of this approach.

For example, Chinese solar company LONGi has developed a “power generation on panels, farming between panels, and planting under panels” model to Ulanbuho Desert in Dengkou County, Bayannur, Inner Mongolia. It is reported to be the first “solar + ecological governance” power station in the area, and is expected to realize the restoration and governance of 3,000 acres of desert, provide green power 200 GWh per annum, save a yearly average of 62,000 tons of standard coal consumption, while reducing carbon and smoke emissions.

This model can improve the microclimate, mitigate natural disasters such as hot and dry winds and sandstorms, increase vegetation cover, and support cash crops and livestock farming, thereby increasing employment and income for local residents. China's solar companies have been vigorously developing and promoting the “solar power for sand control” model, which allows them to not only drive the development of clean energy, but also achieve SDGs such as ecological restoration and rural revitalization.

Chairman of LONGi Green Energy, Zhong Baoshen, says: “We hope more solar companies will collaborate on innovation, explore more global practices of 'solar + ecological restoration,' and take concrete actions to support the United Nations Sustainable Development Goals by 2030, thus achieving sustainable development for all humanity.”

In addition to solar power, wind energy, as another mainstream form of renewables, also plays a significant role in synergizing the SDGs. Many Chinese companies are devoted to innovative models of biodiversity protection for their onshore and offshore wind farms, paying close attention to the impact of onshore and offshore wind farms on bird habitats and migratory patterns.

Longyuan Power, the world's largest wind power operator, is collaborating with academia and local governments to reduce bird collisions and minimize impact on migration by setting up bird nests in safe areas, adjusting turbine spacing and startup speed, and painting blades. Additionally, Longyuan has established offshore wind power bird observation stations to study the impact of offshore wind farm construction and operation on migratory birds and invested in marine ecological restoration projects in its Rudong offshore wind project in Jiangsu province. It has released approximately 1 billion fish and crab larvae into the Yellow Sea and is actively monitoring progress. These initiatives, which realize the synergy between renewable energy and biodiversity, generate good economic and ecological benefits, with the population of birds increasing (especially rare species).

Chairman of Longyuan Power, Gong Yufei, says, “For many years, Longyuan Power has taken active actions in marine ecological restoration and bird protection, fulfilling corporate social responsibility, aiming to combine economic, social and ecological benefits effectively, and promote the harmonized development of renewable energy and ecological protection.”

Chinese renewable companies are constantly innovating in the “renewables +” approaches, such as “renewable + salt farm”, “renewable + fishery” and “renewable + tea farm”, considering regional advantages, policy conditions, and resource endowments, along with local governments and various partners.

Meanwhile, as the world's major renewables equipment suppliers and project developers, the actions of Chinese companies will pave the way for sustainable development of renewable and showcase flagship approaches. For example, LONGi has successfully promoted its photovoltaic sand control model to severely desertified regions in Africa and the Middle East, helping local people achieve both green and economic growth. Companies like Longyuan Power bring high standards and high-quality wind power projects to developing countries such as South Africa, alleviating local energy shortages while promoting employment and community welfare.

To further accelerate progress and achieve full lifecycle sustainable development, companies and stakeholders along the value chain need to continuously collaborate, pushing forward innovations in technology and business models, and scaling up. Chinese and global players need to achieve broader environmental, social and economic benefits, ensuring the leap in renewables a new opportunity for development and making “green” the new frontier and momentum for growth.

This article was written with contributions from Songxian Jiang, Xinhong Qin, Tony Wu, and Zike Zhou of the World Economic Forum; and Agnes Li and Feng Lu from the Boston Consulting Group.