Greener Apple

apple-better-green-practices

In college, I did a research project on the sustainability of Keurig’s coffee machine, looking specifically at its product design. Today, I wanted to talk about Apple, another electronics manufacturer, but from a more holistic perspective – business operations

Apple’s engagement in sustainability really took off in 2006. “Green my Apple” was the innovative campaign led by Greenpeace that urged Steve Jobs to take action to combat climate change. The campaign was a huge success, and Jobs announced publicly that Apple would phase out of toxic chemicals in its product range by 2008 [1]. In 2010, Apple’s main contract manufacturing facility Foxconn in China became the epicenter of scandal when 18 workers attempted suicide, and additional pressure was placed on Apple to promise more transparency in its supply chains management. [2] Since then, Apple has really stepped up to lead the electronics manufacturers in sustainability and social responsibility.

On top of its public image, Apple has financial incentives to incorporate more responsible practices. Renewable energy could be considered less risky compared to fossil fuels in the future as carbon emissions are being monitored and regulated more tightly with time [3]. Also, natural resources are becoming more expensive, so recycling materials has a huge cost benefit [4].

In 2015, Apple produced 38.4 million tons of CO2 [5]. Here is the breakdown:

screen-shot-2016-11-04-at-4-52-06-pm

Business operations made up for 82% of the total emissions, and product & service design, which affects the end consumers, made up for 18%.

Business Operations

To address the carbon emissions during business operations, Apple focused mainly on manufacturing by altering resources and energy.

Resources:

The first big step Apple took was to phase out all the toxic materials, including Beryllium, Mercury, Lead, Arsenic, PVC and Phthalates, and Brominated Flame Retardants (BFRs) [5]. Apple also replaced the polycarbonate and fiberglass chassis with aluminum in iPhones and MacBooks for aluminum’s recyclability. Apple also transitioned from fossil fuels to hydroelectricity in processing of aluminum to reduce carbon emissions, as well as reengineering its manufacturing process to reincorporate the scrap aluminum. In 2015, Apple was able to reduce the carbon footprint of the latest generation of iPhone 6 to 50% of the impact of the previous generation [5]. This change in materials is well-aligned with Apple’s values as a company– aluminum to create sleek design that is still light enough for its users and recyclability and materials efficiency that resulted in cost savings.

Energy:

In 2015, 93% of Apple’s energy came from renewable sources. Although an impressive figure, this figure incorporates all of Apple’s less energy-intensive facilities and carbon offset programs. Because I’m mostly concerned with Apple’s manufacturing process, I decided to calculate Foxconn’s reliance on its own solar farm in Zhengzhou, China, where most of Apple’s products are made. In 2015, Apple produced 38.4 million metric tons of carbon emissions total, 77% of which was from manufacturing. Foxconn’s solar farm produces about 400 megawatts of solar, and assuming that 4 gigawatts of solar energy offsets 30 million metric tons of carbon, Foxconn’s solar farm offsets about 3 million metric tons of CO2 [5]. Therefore, in reality, only 10.2% of its manufacturing energy was actually provided by its own renewable source. This is definitely a huge area for improvement for Apple.

But what is really exciting is that Apple helps its supplier facilities in China, Taiwan, and Japan to be more sustainable through energy audits. The audits successfully identified more than 224 million kilowatt-hours of electricity in annual savings opportunities over 13 facilities. From these identified improvements, suppliers have already reduced over 18 million kilowatt-hours of electricity, avoiding 13,800 metric tons of CO2 [5].

What more can they do?

I am mostly concerned about Apple product and service design, specifically its’ re-usability. At the end of the day, electronics are in nature very resource-intensive products, and Apple needs to incorporate more sustainable design principles to reduce the impact of usage. Even though Apple products are known to be durable, its free warranty only lasts for one year. This is both a product and service design problem – just a couple weeks ago, my 2-year-old MacBook broke down. I had the option of sending in my laptop to be fixed for around $800 or buying a new one for $1200. I chose the latter. This is a product design problem because unlike many PCs, MacBooks have to be sent back to its manufacturer in China to be fixed because of how compact the built-in parts are. It’s also a service design problem because the public perception is still that warranty is not worth the money [7]. If Apple truly wants to cut down on their carbon emissions, rethinking how their products are perceived and used throughout its lifecycle will be essential.

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Sources

  1. “Green my Apple bears fruit”. Greenpeace International. 31 May, 2007. http://www.greenpeace.org/international/en/news/features/greening-of-apple-310507/
  2. Bapna, Manish. “Foxconn Scandal Offers Supply Chain Lessons”. 29 Feb., 2012. http://www.forbes.com/sites/manishbapna/2012/02/29/foxconn-scandal-offers-supply-chain-lessons-2/#40e13b421548
  3. Randall, Tom. “Wind and Solar are Crushing Fossil Fuels”. 06 April, 2016. http://www.bloomberg.com/news/articles/2016-04-06/wind-and-solar-are-crushing-fossil-fuels
  4. “Materials Costs”. https://www.ttiinc.com/content/ttiinc/en/resources/tools/material-costs.html
  5. “Environmental Responsibility Report, FY 2015”. http://images.apple.com/environment/pdf/Apple_Environmental_Responsibility_Report_2016.pdf
  6. “MacBook Air (13-in, Early 2015) – Technical Specifications”. https://support.apple.com/kb/SP714?viewlocale=en_US&locale=en_US
  7. Davidson, Jacob. “Why you should skip that extended warranty”. 05 Dec., 2014. http://time.com/money/3614343/extended-warranty/

featured image from https://blog.dashburst.com/apple-more-renewable-power/

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6 thoughts on “Greener Apple

  1. Interesting post! It seems like Apple has significantly ramped up their environmental commitment. They’ve recently issued a green bond, been building a more sustainable campus, and Tim Cook has spoken publicly about the importance of protecting our world. Reading your post about what they have done on the product side was fascinating. I would push back on your thoughts about Apple’s warranty policy. I know it’s frustrating that the free warranty is only for a year, but you can buy AppleCare which extends coverage to three years. It sounds like for many consumers, having the insurance is worth it. At the end of the day, Apple is a for-profit company and AppleCare is a strong driver of revenue, and they need money to pay the people working on repairs. I also think that given Apple’s commitment to product excellence, even with these design changes that promote sustainability, they won’t compromise on product quality so there isn’t a perception problem. I do agree that it is problematic that the manufacturer is in China. Seems like a lot of energy and money could be saved if Apple had regional repair centers.

    Also, sorry to hear about your MacBook!

  2. – Really well researched! Loved the perspective on “product usage” carbon emissions – I hadn’t thought of carbon emissions in terms of the full end-to-end carbon footprint of a product. This aspect plays out in a topical debate in Australia: whilst we can reduce site carbon emissions of our coal mines, the simple fact is that selling fossil fuels contributes to climate change.
    – One aspect of Apple that interests me came to light when I visited their campus in 2014. Their head office had a huge focus on sustainability in terms of solar panels, recycled water etc. You indicated in your blog that the carbon emissions of a head office pale in comparison to manufacturing sites, but I think you’d agree that there’s a lot to be said for a firm that’s prepared to live its sustainability principles end to end. It gets embedded in the culture of innovation in the firm.
    – I thought your conclusion was interesting and I would like to read more into that. Apple products seem to have planned obsolescence so by their very nature, the phones get disposed after 2 years. This might maximise revenue by shortening the replacement cycle (as you found out!!!) but it’s at odds with a sustainable future. Do you think there’s any way that Apple can reconcile those two divergent goals?

  3. Great perspective on how Apple has tried to cover the full spectrum in reducing their environmental footprint, both through supply-chain sourcing and energy consumption. I had no idea that my Iphone was made from recycled materials. I am that much happier that I made the switch to Apple!

    In your last paragraph, you touched on a point that has been discussed recently in class, the issue of selling a product upon which the company revenue relies on a repurchase in the near future. How can a company that constantly promotes product upgrades claim to be sustainable? I feel that Apply should do more to highlight the point that phones replaced through the Apple Upgrade Program are refurbished and reused in other markets. I feel that this isn’t common knowledge nor is it widely articulated by Apple.

    While I generally do agree with your point that the costs typically associated with repairs is too high, don’t knock Apple on this point entirely. Forcing customers to replace items instead of repair by charging high repair prices is counter to a sustainable message. It is quite ironic that products tend to fail directly after the expiration of their warranty. However, I had a different experience with repairing a Macbook. After almost six years of use, my wife’s Macbook finally began to have issues with the motherboard. Apple replaced this, along with a new screen and an upgraded power port for about a quarter of the price of a new similar Macbook.

    Thanks for helping me learn something new about a company whose products I use constantly.

  4. This is a really interesting post! Throughout the post, I kept wondering how sustainability and a complex global supply chain like Apple’s will support / hinder its future product development and the unit economics of Apple’s current and future products. From your post, it looks like it some ways, Apple was being reactive to the supply chain problems they faced, partially due to media attention. It would be interesting to see how as they move forward with product design and service, what factor a sustainable supply chain would factor into this. As you probably know, the markets have the view point that innovation at Apple has stalled, and we’ve learned about this in a few of our classes (FRC, most notably); I wonder given this context if Apple’s next wave(s) of products will proactively (as opposed reactive) factor in the potential supply chain issues of manufacturing products with newer specifications. Said another way, can Apple make sustainable products, that are innovative, with a healthier supply chain (potentially more costly) and still meet the expectations of shareholders and stakeholders.

    Really thought provoking read!!

  5. It is interesting that you pointed out the poor repairability is a big problem. I agree, primarily on the desktop/laptop end. Their iPhones are primary computing device for everyday use. Compared to old computers, manufacturing these devices use much less resources and materials. Also, led by Apple’s iPhone, mobile devices are much less energy hungry. iPad is known for its durability, and people have few incentive to replace their old iPads. Therefore I think overall their mobile devices really had positive impact on sustainability. Granted, I agree that recycling is key since these gadgets have aggressive upgrade cycles. Apple does accept devices and computer for recycling in their store, but I think few people take advantage of that.

  6. Alison, thank you for the thoughtful analysis! It sounds like Apple has taken some important steps in the right direction to create environmentally sustainable products for the future. I agree with your suggestion that Apple should now focus its attention on re-usability. As with many consumer product companies, waste and recycling are important to consider when thinking about the end of the product life cycle. Do you know what Apple does with unsold iPhones under its new upgrade program?

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