ACHEMA Start-up Award Finalist: Carbon Minds

How can you reduce climate-relevant emissions in you supply chain? In order to tackle this, you need to know where climate emissions actually derive from. Carbon Minds wants to support companies with their extensive data model.

Over the past years, many companies have adopted ambitious goals to reduce their greenhouse gas emissions. But how to measure the impact their products have on the climate? Without transparency and knowledge, the journey toward more sustainability is a journey in the dark – with an uncertain ending. “Chemicals and plastics are in 95 % of manufactured goods, so you can put yourself in the shoes of basically any manufacturer, or any chemical company who makes chemicals for them. As manufacturers become more sustainable one of the hardest challenges – and greatest opportunities – they face is the supply chain. Supply chains make up on average 80 % of the carbon footprint of finished products. But in highly complex, global chains, good quality climate data is scarce. Low data availability makes it almost impossible to compare suppliers' impacts and find supply chain emissions reductions,” says Dr. Arne Kätelhön, one of the founders of Carbon Minds.

Complicated and opaque supply chains

In addition, depending on where a company sources its chemicals and materials, production pathways might differ, resulting in vastly different environmental impacts. Choosing suppliers according to climate impact, though, is complicated, as Arne Kätelhön explains: “Let's say you make laptops. Laptops contain chemicals (e.g., in the form of polymers), and those chemicals are often based on other chemicals, which are made from other chemicals etc. At each stage in that chain, multiple suppliers, using different production technologies in different parts of the world are all involved. For our laptop manufacturer it's almost impossible to pinpoint who is creating emissions in their supply chain and what alternatives exist - so the laptop company can't start a conversation with their suppliers about their impacts, because they don't know what they are, and they can't consider switching suppliers because they don't know what the alternatives might be.”

Modelling the chemical world

Trying to analyze such a value chain can quickly lead you to go off on a tangent, hopping from detail to detail. Carbon Minds takes a different approach: “We solve that problem by modelling the entire global chemical industry from the bottom up, which means we start with individual production plants and then model how they are all interlinked by trade, so we can give the laptop company data on what impacts their suppliers have, where the hotspots are, all the way through their supply chain - and with that data they can then decide how to engage their suppliers or switch. With this intelligence in hand, decision makers can optimize their supply chains by choosing sustainable suppliers, respond to environment-related pressures from market forces and achieve cost-efficient environmental impact reductions. In summary, we solve an interconnected set of problems related to the quality, availability and transparency of a company’s environmental data.”

Building on what was already there

The data can be used to perform a detailed supply chain analysis, to provide life cycle assessment, but also to build a digital twin ranging from a single site to an entire company to identify emission reduction opportunities. According to their website, Carbon Minds to that end has accumulated 30,000 data sets on 1,000 chemicals in 150 regions. “Our primary innovation is our unique digital model of the chemical industry. No one before us has created a model of the industry for environmental assessments based on each individual production plant that makes up the global chemical supply chain. By modeling production sites of over 2000 individual companies, we have created a model of unprecedented scope and detail,” states Kätelhön. “The most important moment was when we realized that a lot of the data companies need is actually already out there – data on chemical processes, feedstocks, production technologies, regional and international trade flows and volumes.”

In contrast, information on environmental impact was only available on a country-average level, if at all.  Comparing the ecological impact of the same product from different producers was mostly impossible. “We improve upon the accuracy and reliability of what came before us. By modeling supplier-specific environmental impacts, we enable our costumers to systematically optimize their supply chain by choosing the most sustainable suppliers or engaging with their existing suppliers based on solid data,” says Kätelhön.