Energy-climate-manufacturing nexus: New insights from the regional and global supply chains of manufacturing industries

Abstract

The main objectives of this research are to improve our understanding of energy-climate-manufacturing nexus within the context of regional and global manufacturing supply chains as well as show the significance of full coverage of entire supply chain tiers in order to prevent significant underestimations, which might lead to invalid policy conclusions. With this motivation, a multi region input–output (MRIO) sustainability assessment model is developed by using the World Input–Output Database, which is a dynamic MRIO framework on the world’s 40 largest economies covering 1440 economic sectors. The method presented in this study is the first environmentally-extended MRIO model that harmonizes energy and carbon footprint accounts for Turkish manufacturing sectors and a global trade-linked carbon and energy footprint analysis of Turkish manufacturing sectors is performed as a case study. The results are presented by distinguishing the contributions of five common supply chain phases such as upstream suppliers, onsite manufacturing, transportation, wholesale, and retail trade. The findings showed that onsite and upstream supply chains are found to have over 90% of total energy use and carbon footprint for all industrial sectors. Electricity, Gas and Water Supply sector is usually found to be as the main contributor to global climate change, and Coke, Refined Petroleum, and Nuclear Fuel sector is the main driver of energy use in upstream supply chains. Overall, the largest portion of total carbon emissions of Turkish manufacturing industries is found in Turkey’s regional boundary that ranged between 40% and 60% of total carbon emissions. In 2009, China, United States, and Rest-of-the-World’s contribution is found to be more than 50% of total energy use of Turkish manufacturing. The authors envision that a global MRIO framework can provide a vital guidance for policy makers to analyze the role of global manufacturing supply chains and prevent significant underestimations due to inclusion of limited number of tiers for sustainable supply chain management research.