Tesla's Impact Report: Can Musk Conquer Scope 3 Emissions?
Tesla's 2024 Extended Impact Report reaffirms the company’s ambitions, but with sales under pressure and its CEO Elon Musk never far from headlines, the timing is critical.
Though it touches on the company’s progress in EVs, renewable energy and data centres, the report's real emphasis is on where Tesla faces the most challenges: the supply chain.
From emissions in the early stages of production, to the effort required to clean up its factories and material sourcing, the report outlines the actions Tesla is taking — and calls out others for not doing enough.
Manufacturing emissions and decarbonising the chain
Tesla opens by acknowledging that emissions from vehicle production, especially in the supply chain, still present a major problem. Compared to petrol or diesel models, the emissions generated before an EV even hits the road can be higher.
However, the company insists that these are short-term trade-offs.
“While EVs today produce more GHG emissions during the manufacturing phase (including emissions from the supply chain), in less than four years of driving, a Tesla vehicle’s lifetime emissions are lower than those of a comparable ICE vehicle,” the report reads.
Tesla claims this gap will shrink as it improves material use and streamlines its production. It credits innovations in “material efficiency, operational and supply chain decarbonisation and end-of-life recycling” as key to this effort.
It quantifies the environmental return on its vehicles clearly: “After 17 years of driving (which is the average life of a vehicle in the US), a single Tesla vehicle will avoid about 35 tons of CO2e globally.”
Energy storage is also included in its broader supply strategy. Its Megapack system, which stores electricity for utilities, is designed to make renewable energy more accessible at peak times. This enables the replacement of fossil fuel-based sources when demand is highest — a central part of its approach to cutting emissions across the board.
Supply chain tech
Tesla also lays out how AI is being deployed across its sites to tackle resource use. In factories from Texas to Berlin, AI now controls systems like HVAC (heating, ventilation and air conditioning), helping them process real-time data and automatically optimise operations.
“In 2023, AI Control for HVAC was expanded from Nevada and Texas to include our Berlin-Brandenburg and Fremont factories,” Tesla says.
By linking factory sensors, modelling factory conditions and automatically adjusting energy use, the systems can reduce energy demand while keeping operations running. The report says one site alone – Gigafactory Berlin – saves 17,000 MWh per year through these efficiencies.
Other technologies include using N-Methylpyrrolidone in material extraction to reduce energy consumption. In Nevada, this saves 9.5 GWh annually, which contributes to its overall efforts to cut emissions in the early stages of production.
Tesla is also applying similar thinking to its data centres. At Gigafactory Texas, the company is planning a waste heat recovery system. This will use captured heat from data centres to provide hot water for vehicle coating and paint work — reducing demand on chiller systems.
The report adds that improvements to chiller efficiency during colder periods further support this balance between cooling performance and sustainability.
Calling out the emissions framework
Tesla’s tone throughout the report is clear — and occasionally combative. When it comes to the global framework used to measure greenhouse gas (GHG) emissions, the company claims that it benefits large, polluting firms.
It says: “The popular frameworks for measuring and reducing GHG emissions continue to benefit their authors and those well-established companies with polluting products – they do not recognise real-world impact.”
The company argues that emissions avoided by selling zero-emission products like EVs and solar panels are not fairly captured under current systems. In Tesla’s view, this distorts comparisons and makes it harder to assess which companies are genuinely working to decarbonise.
There’s also a clear challenge issued to competitors. Tesla wants other carmakers to accelerate their transition to EVs and take the supply chain issue as seriously.
It says: “Electric vehicle sales by all automakers need to increase. We hope that every vehicle manufacturer will strive to produce hundreds of thousands of EVs per year, as significant reductions in emissions will only be achieved with an industry-wide shift.”
In that spirit, Tesla highlights how it has opened its Supercharger network in North America and shared its connector design with other vehicle manufacturers, in a bid to help the broader transition.
Renewable procurement is another area Tesla points to as essential for wider change. Through long-term power purchase agreements (PPAs), Tesla sources electricity from solar and wind projects in North America and Europe. Since 2023, it has secured almost 1 GW in renewable energy, and plans to match all energy used in its operations with renewables.
Looking ahead, the company insists that reducing supply chain emissions will define the success of its climate goals. Its goal of achieving net zero across every product stage, from mining to recycling, depends on it.
