In 2021, Vallourec Tianda began installing solar panels at its Chuzhou and Changzhou sites. The motivation behind the project was twofold: decreasing Vallourec Tianda’s environmental impact and reducing energy costs. Mathieu Barreau, General Manager at Vallourec Tianda (Anhui) and VAM (Changzhou) Oil & Gas talks us through the process and explores its benefits.
In 2021, Vallourec’s Tianda team formed a steering committee aimed at improving its performance in a number of areas, including environmental impact. “We brainstormed extensively, but realized very quickly that the most effective way to decrease CO2 emissions would be to change our sites’ energy consumption,” Mathieu Barreau says.
In China, companies looking to run on greener energy have two options. They can either purchase nuclear energy from the government or install solar panels and contribute to the power grid. “If they choose to go down the solar power route, companies benefit from discounted rates on electricity along with carbon reduction subsidies,” Mathieu explains. “So, it made perfect sense that the steering committee voted to install solar panels at both sites.”
We brainstormed extensively, but realized very quickly that the most effective way to decrease CO2 emissions would be to change our sites’ energy consumptionMathieu Barreau General Manager at Vallourec Tianda (Anhui) and VAM (Changzhou) Oil & Gas
A project of this scale and importance required careful planning and rigorous implementation. The team’s first job was to ensure that the project was designed in line with both Chinese regulations and Vallourec’s internal goals. In China, the government has set its targets for peak CO2 emissions by 2030 and carbon neutrality by 2060, while specific regulations are managed at a provincial level. This extends to fixing the electricity discount rate, which is calculated differently in each of China’s 23 provinces.
“As we embarked upon the project, it was imperative for us to work closely with local authorities to ensure our project fit with local guidelines,” says Mathieu.
The project is fully in line with our CO2 reduction trajectory approved by the SBTi (Science Based Targets initiative). Part of Vallourec’s action plan is to buy greener electricity (Scope 2), to reduce its global CO2 emissions 25% by 2025 compared to the base year 2017.
After the project kick-off in September, the teams started looking for suppliers in October. This was a particularly challenging part of the process, as they needed to source suppliers willing to fulfill 25-year contracts for the delivery of large numbers of solar panels.
“This was an unusual request, but was advantageous to suppliers as it guarantees long-terms business,” Mathieu says. “Taking into account the discounted electricity rate and subsidies, these terms meant that the entire solar panel project cost Vallourec absolutely nothing in the long run.”
Once the solar panel project had been thoroughly reviewed internally and approved by local authorities, implementation began in May 2022 and continued throughout June. The solar panels were connected to the grid in July 2022, and the sites started benefitting from the promised discounted electricity and subsidies.
The project teams are justifiably proud of their achievement and the role they have played in Vallourec decarbonization journey. Team members shared the following words:
This initiative represents a strong commitment to the use of green energy for the Tianda plant, It is in line with the Group's emission reduction strategy and delivers enterprise contribution to the Chinese government's 2030 carbon peak and 2060 carbon neutrality goals.Robert Li Vallourec’s Capex and Government Affairs Relationship Manager and CTO at Vallourec Tianda Chuzhou
It’s amazing to be able to leverage the power of the sun and create energy savings at the same time.Xi Jianfeng Vallourec’s Tianda Plant Manager in Changzhou
This is a real game-changer that will generate significant savings for operations, and really differentiates us from our competitors in the market as well!Chang Liwei Vallourec’s Sourcing Manager in China
Striking while the iron is hot, in the second half of this year Tianda teams are turning their focus to other environmental issues like water and waste management. Meanwhile, Vallourec as a group is working with its suppliers to decarbonize the entire value chain. “The success of this project is creating exciting momentum and will surely drive us to find other ways to make our sites more sustainable,” Mathieu says.