How we’re becoming carbon positive in our operations
Sourcing our energy from 100% renewable sources will make us a more competitive business and help create a better future where energy is clean, reliable and affordable for all.
What does carbon positive mean?
We want to play a leading role in the transition to a low carbon economy. That's why, in 2015, we set ourselves the ambition of becoming carbon positive by 2030. Becoming carbon positive means we will eliminate fossil fuels from our operations - and directly support the generation of more renewable energy than we consume.
Since 2015, we’ve been making progress in investing in clean technologies, increasing our energy efficiency and in switching to renewable energy sources. In 2017, we extended the scope of our carbon positive ambition from manufacturing to all operations, including distribution centres, research laboratories, marketing and sales offices and data centres.
By becoming carbon positive, we will:
- Source all our electricity purchased from the grid from renewable sources by 2020
- Source 100% of our energy across all our operations from renewable sources by 2030
- Eliminate coal from our energy mix by 2020
- Directly support the generation of more renewable energy than we consume, making the surplus available to the markets and communities where we operate by 2030.
The Science Based Targets Initiative has validated our carbon positive targets as meeting the level of decarbonisation (removal of carbon dioxide from the atmosphere) that is needed to keep the global temperature increase below 2 degrees Celsius (compared to pre-industrial levels)1. Through the action we’re taking to achieve our carbon positive targets, we’re contributing to two UN Sustainable Development Goals (SDGs): Affordable and Clean Energy (SDG 7) and Climate Action (SDG 13).
Building on decades of emission reductions
We announced our carbon positive targets in 2015 ahead of the Paris Agreement, building on our 20 year track record of cutting our greenhouse gas (GHG) emissions. By the end of 2016, we had cut CO2 emissions by 43%2 per tonne of production versus our 2008 baseline, which meant we had exceeded the target for 2020 we set in our Unilever Sustainable Living Plan. In 2017, we went further, cutting CO2 emissions by 47%† per tonne of production.
Sharing the benefits of a low carbon economy
We cannot become carbon positive alone, so we're working collaboratively with partners, suppliers and others to achieve our ambition. Our success partly depends on broader change in energy markets worldwide, such as the rate of installation of renewable electricity in many countries - and we recognise we have a role to play as an industry leader to help shape those markets. Our ambition is also a statement of commitment: to show that businesses can commit to a low carbon economy - and that a low carbon economy is good for business.
Our goal of becoming carbon positive is based on a sound business case.
By becoming carbon positive, we expect to:
- lower operational costs
- improve resilience in our energy supply
- attract investors, who are increasingly considering carbon risk
- develop a closer relationship with our consumers.
The Paris Agreement could unlock $13.5 trillion in growth opportunities by 2030, as nearly 200 countries seek to accelerate their efforts to address climate change. By helping to build a business model that moves beyond a reliance on fossil fuels, we hope to benefit from the opportunities that new ways of doing business will create.
We’re on the path to decarbonisation – and there’s no turning back. Not taking action to avoid runaway climate change would be a moral abdication of our responsibility to the most vulnerable and to future generations. But driving the movement towards a low carbon economy – that’s a huge opportunity, and one that Unilever must be a part of.Paul Polman, CEO
Sourcing our energy from renewables
In our operations, we use two forms of energy: heat (thermal) and power (electrical). We use thermal energy mainly in the form of steam during manufacturing. Electrical energy is used for a range of purposes, such as lighting and powering machinery. As part of the action we’re taking to achieve our carbon positive ambition, we’re in the process of eliminating our use of fossil fuels for generating both heat and power.
A third of our manufacturing energy comes from renewable sources
We have a network of environmental managers around the world, who bring our ambitions to life. By the end of 2017, 33.6% of our total energy use - electrical and thermal - across our manufacturing operations came from renewable sources.
Our 2020 target is to use 100% renewable grid electricity, but we also directly generate electricity on our sites. In 2017, 28 of our manufacturing sites generated renewable electricity on-site, mostly from solar and hydro power. For example, in South Asia, many of our sites have open land, which gives us the opportunity to install on-site solar panels. After successfully installing solar panels in two sites in Pakistan in 2016, we replicated this at four sites in India in 2017.
When it’s not possible to produce our own renewable electricity, we make direct purchase agreements with large-scale solar, wind, hydro and geothermal installations, and with small-scale hydropower schemes. Around 90% of the electricity used across our factories, distribution centres and offices in Mexico has been produced from wind power. In the Philippines, we are now sourcing most of our electricity from a geothermal power plant.
Biomass will play an important role in our transition away from coal and other fossil fuels. In 2017, 49 of our manufacturing sites used biomass or biogas, such as agricultural by-products and wood waste. This reduced our annual CO2 emissions by over 250,000 tonnes.
Our biomass programme continued to expand in 2017, when we started installation of a new biomass boiler at our Gateway site in Thailand, which will reduce CO2 emissions by over 400 tonnes per year. We also make our own biogas at some sites, including our Burton site in the UK where we convert the by-product from making Marmite into biogas, which we use in our boilers.
100% renewable grid electricity
By the end of 2017, 109 of our manufacturing sites across 36 countries were using 100% renewable grid electricity. This accounts for 65% of our total grid electricity consumption and includes manufacturing sites across all continents.
In 2014 we were a founding signatory of the RE100 global campaign for influential businesses to commit to using 100% renewable electricity. We use RE100’s definition of renewable electricity, which includes electricity which has been produced from biomass (including biogas), geothermal, solar, water and wind sources. In 2017, ten of our sites in the UK and Ireland used 100% renewable electricity from a 23 turbine strong wind farm in Lochluichart in the Scottish Highlands. With other businesses and NGOs – including SSE, Greenpeace and the WWF - we’re also advocating for more government investment in offshore wind power in the UK.
Renewable Energy Certificates (RECs) play an important role in helping us meet our target to source all our electricity purchased from the grid from renewable sources by 2020.
RECs account for renewable electricity when it is transferred via the grid. A REC states that one party has generated renewable electricity and then sold it to another party, who 'retires' the REC to show they’ve used it. We follow CDP and RE100’s climate reporting frameworks, which allow the use of RECs and ensure that the energy must be generated in the markets where we use it, but do not allow energy offsetting.
Harnessing the power of renewables
Jorge Acosta, Regional Environmental Manager, Latin America
“As a father, I’m committed to protecting the environment for future generations. My mantra is ‘small actions, big difference’.
Climate change is a big challenge. The world is seeing an increase in the quantity, and intensity, of natural disasters – like Hurricanes Irma and Maria which struck the Caribbean in September 2017, leaving people without power for days. Climate change is resulting in more of these natural disasters. And, this impacts the security and reliability of our energy supplies.
Since mid-2016, hydropower has provided 100% of the electricity we need for our factories in Brazil. Out of our 38 sites in Latin America, 21 are now getting their electricity from renewable sources. And we expect all locations to achieve this by the end of 2020, which will lead to a 50% cut in carbon emissions.”
Eliminating coal from our energy mix
Coal is the biggest global source of man-made CO2 emissions and the dirtiest fossil fuel - and we're committed to eliminating it from our energy mix by 2020.
Coal can either be used directly - meaning that coal produces heat or power physically on our sites - or indirectly, which refers to us buying energy generated from coal by a third party. We’re phasing out both our direct and indirect use of coal through solutions such as solar energy, wind power, and biomass or biogas.
In 2017, 1.1 million GJ of the energy used at 16 of our manufacturing sites was generated from coal. By the end of 2017, this was reduced to 12 sites. How we phase out coal varies by site because of the differences in geography and the resources available locally. In 2017, for example, our Odense site in Denmark successfully moved away from using coal to using steam produced from biogas generated at an adjacent wastewater treatment plant. Overall, this has prevented 55 tonnes CO2 from entering the atmosphere each year.
Improving our energy efficiency
While we rapidly seek ways to replace fossil fuel energy sources with renewable energy, we are also constantly improving our energy efficiency to reduce the amount of energy we need. By the end of 2017, we had reduced the energy we use in our factories by 26% per tonne of production since 2008. This reduction has also contributed to cumulative cost avoidance of over €490 million since 2008.
New factory design plays a significant role in improving energy efficiency and achieving our GHG emissions targets. In addition to eco-efficient design of our production processes, we use Green Building Council LEED certification rating process for buildings. An example is our new beauty & personal care factory in Dubai, which opened in 2017. It uses solar energy generated on-site to provide 16% of the electricity for the site.
Read more about how we're investing for a sustainable future.
The first step towards carbon positive: becoming carbon neutral
By the end of 2017, 15 of our sites globally were carbon neutral. This means that these sites have no net impact on CO2 levels in the atmosphere. These sites have used a variety of renewable energy sources to move away from fossil fuels. For example, since January 2017, our offices in Surrey and London, and our foods and refreshment factories in Trafford Park and Cork have been powered by 100% renewable electricity from the grid and 100% biomethane (also known as biogas). The biomethane – which is fully traceable and certified – is generated from anaerobic digestion, which converts inedible food waste and sewage into energy.
Funding renewable energy through internal carbon pricing
Carbon pricing is a fundamental part of tackling climate change, putting a price on the carbon emissions emitted by a business to ensure it is considered when making financial decisions. We have implemented carbon pricing in our business case calculations and signed the World Bank’s carbon pricing statement to encourage others to do the same.
In July 2016, we introduced an internal carbon levy which now charges our business divisions €40 per tonne of carbon emitted. Using the levy, we created an internal ‘Clean Technology Fund’ to invest in renewable energy sources on our manufacturing sites, accelerating the rate at which we’re moving to our 2030 carbon positive targets.
We have used this fund for projects such as installing a biomass boiler in our Tema factory in Ghana. And in our Cuernavaca site in Mexico, we installed a solar thermal system to provide hot water in the factory.
A carbon positive vision: will you be a part of it?
Ambitious climate action is possible – and profitable. We want to go beyond eliminating CO2 emissions from our own operations by helping the markets and communities associated with our factories to move to using renewable energy.
The challenges that society faces through climate change means there is a strong case for government and business investment in new renewable energy technologies, as well as further research on the sustainable use of biomass. Investment should be accelerated in existing low-carbon energy production and in deploying new low-carbon energy technologies, such as wind and solar energy.
In developing countries, we will look to stimulate investment to expand and further develop the renewable energy industry through partnering with renewable energy providers.
System-wide change is key to success. If you think you can help us achieve these targets, please contact us at email@example.com.
1 We set our first science-based target in 2010, which is our GHG pillar commitment of halving the greenhouse gas impact of our products across the lifecycle by 2030. Our second science-based target is sourcing 100% of our energy across our operations from renewable sources by 2030. Both have been validated by SBTi.
2 Independently assured by PwC in 2016: PwC Assurance Report 2016 (PDF | 208KB).
Photo by Apoorva Singh, Roof of Silvassa Detergent Factory, Silvassa, India.