AstraZeneca: Tackling Supply Chain Heat Decarbonisation

Despite the global push for decarbonisation across supply chains, heat decarbonisation efforts rarely take off.

Deemed too challenging, heat is now a strategic risk that needs to be addressed through cross-industry supply chain collaboration.

In an attempt to do so, AstraZeneca, Secaro and ERM have launched the Clean Heat Programme.

Tackling a growing concern

AstraZeneca, a global pharmaceutical company, Secaro, a supply chain intelligence platform, and  ERM, a sustainability consultancy, have announced the launch of the Clean Heat Program. At present, businesses around the world are facing energy security risks and price volatility, with the inability to protect themselves against it. 

The programme is designed to bridge the gaps in supply chain heat decarbonisation efforts, which are facing ongoing issues and prevent businesses from developing resilience. As a result, heat is now no longer just a technical issue, but a strategic risk. This is furthered by the EU's incoming carbon importer costs (CBAM) and new SEC rules causing increased scrutiny. 

Suppliers who are unable to meet their buyers' climate targets are at risk of losing business as organisations around the world look to decarbonise their operations and tackle Scope 3 emissions. However, suppliers can unlock value through heat decarbonisation, through investments into renewable energy power purchase agreements (PPAs). These can generate significant energy cost savings, as well as a secure energy supply. On-site generation is also becoming a cost-effective solution.

Through collaboration on heat decarbonisation, suppliers can build stronger relationships with key buyers and gain more valuable resilience through more regulation. 

“Decarbonising heat is now business critical,” says Emily Prior, Chief Growth Officer at Secaro.

“It is an essential way to protect revenue, reduce exposure to energy price shocks and stay ahead of regulation and investor and customer expectations.”

Industry insights

While reducing emissions and improving environmental impact are main components of decarbonising heat, there is much more to it. However, many businesses remain focused on alternative climate goals. Recent studies demonstrate that 65% of companies have established net zero climate targets, with an increase of companies adopting Science Based Target Initiatives (SBTi) increasing by more than 14% in 2025. Despite this, heat decarbonisation is viewed as too technically difficult to address.

This is a major concern as industrial process heat accounts for 18% of global greenhouse gas (GHG) emissions every year, with a heavy reliance on fossil fuels. Research undertaken by Secaro's pharmaceutical program demonstrates that 80% of facility emissions are scope 1 and 60% are natural gas. Less than 10% within this sample use biofuels for direct energy, with industry research suggesting that renewable heat is predicted to reach only 15% by 2028. 

The Clean Heat Programme, however, will rely on Secaro's vast network of environmental supply chain data – which includes: 

• 8,000 strong membership of buyers, suppliers and solutions providers
• New heat-specific data
• The platform’s data collection, analysis and solution recommendation tools

Alongside that, ERM will use Secaro's insights to provide deeper, technical assessments on heat, before guiding businesses towards solutions and investments in order to make an impact. 

“By combining Secaro’s data with ERM’s technical expertise, we can accelerate the delivery of heat decarbonisation projects that have historically struggled to move beyond preliminary assessment,” explains Jon Hughes, Partner at ERM.

“The Clean Heat Program will provide clients with the practical implementation support required to decarbonise industrial heat while strengthening resilience, reducing risk and unlocking value across the supply chain.” 

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Barriers to implementation

A major factor to heat decarbonisation is internal capital constraints. Though onsite teams can identify where new boilers or upgrades are needed, they often lack clear pathways for securing finances, especially as CFOs are increasingly required to prove short payback periods. 

As a result, this programme looks to help organisations with these constraints.

“Many organisations are looking at heat in isolation, comparing the current gas bill to a full switch to biomethane for example,” continues Emily.

“In order to succeed in decarbonising supply chain heat, businesses need to take a more holistic approach that starts with efficiency, and then moves to decarbonised fuels, so that the economics work. As part of this program, businesses will have access to a range of financing solutions, including access to the EU-based heat decarbonisation fund and off-balance-sheet financing partners.”

AstraZeneca has joined as a founding partner, enabling it so better collaborate with peers, suppliers and major buyers in other industries. Through this, it will address common issues that are delaying heat decarbonisation, as well as gaining access to shared learning that can help it enable critical supplier action.

"It's clear that a program like this is the fastest and most effective way to decarbonise heat in our supply chain," says Rob Williams, Senior Director of Sustainable Procurement at AstraZeneca.

“We are long-term partners with Secaro and ERM, and now we're expanding relationships with peers, buyers from other industries, and suppliers to plan, fund and launch the projects that will make heat decarbonisation a reality. This level of collaboration is essential." 

The programme is taking influence from collaborations such as the Sustainable Markets Initiative (SMI), which focuses on heat decarbonisation through supplier education. It will also work closely with the Pharmaceutical Supply Chain Initiative (PSCI) and the Scope 3 Peer Group, as well as their initiatives. 

Through education and consultancy, the programme aims to help businesses around the world tackle their emissions and implement heat decarbonisation strategies in a cost efficient and value-driven way.