Tackling climate impact in our operations
We’re taking action on our climate impact by eliminating fossil fuels from our operations and using renewable energy.
Acting on climate science
Urgent global action is needed to tackle the climate emergency. The science is clear: we must keep global warming to no more than 1.5⁰C above pre-industrial levels to prevent the worst effects of climate change. But current forecasts point to a temperature increase of between 3-4⁰C by 2100 as global emissions continue to rise.
We are already seeing more frequent extreme weather events around the globe, with devastating impacts on people and the environment. Climate change also carries risks to businesses, including ours. But we see opportunities too.
Accelerating the transition to a net zero carbon economy is a priority for governments and businesses. We want to play a leading role in that transition. Ahead of the Paris Agreement in 2015, we set an ambitious target to become carbon positive by 2030 – by eliminating fossil fuels from our operations and directly supporting the generation of more renewable energy than we consume.
By 2030, we aim to source 100% of the energy we use across all our manufacturing operations from renewable sources. The Science Based Targets initiative has validated this target as meeting the level of decarbonisation (removal of carbon dioxide from the atmosphere) needed to keep the global temperature increase to 1.5⁰C.1
Through our investment in renewable energy, we’re contributing to two UN Sustainable Development Goals (SDGs): Affordable and Clean Energy (SDG 7) – specifically target 7.2 on increasing the volume of renewable energy in the global energy mix – and Climate Action (SDG 13). The switch to clean energy will not only help to create a better future, it will also make us a more competitive business.
The business case for a net zero carbon economy
A net zero carbon economy is good for the planet. And it’s good for business. The Paris Agreement could unlock $13.5 trillion in growth opportunities by 2030 as nearly 200 countries seek to accelerate efforts to tackle climate change.
We believe that ambitious climate action is possible – and profitable. 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.
Our ambition to use 100% renewable energy in our manufacturing operations by 2030 is based on a sound business case. We expect this to lower operational costs, improve resilience in our energy supply and attract investors who are increasingly considering carbon risk. We are committed to aligning our future capital expenditure with this long-term GHG reduction target.
How do our operations contribute to our carbon footprint?
We need energy to make our products, fuel to distribute them to our customers, and energy and refrigerants to keep our ice creams cold.
The GHG emissions from all these operations make up only a small portion of our total carbon footprint – just 1% comes from manufacturing, 3% from distribution and 5% from retail. But we’re still working hard to reduce these emissions as much as possible, as quickly as possible.
We have long been making progress in investing in clean technologies, increasing our energy efficiency and switching to renewable energy sources. We’re also focusing on efficiency and innovation to reduce CO2 emissions from transporting our products and from our freezers in retail stores.
Measured 1 July 2018 – 30 June 2019
Did you know?
Our offices make up less than 1% of our total greenhouse gas (GHG) footprint. Though this may seem small, we still look for opportunities to reduce our impact.
We do this in five key ways:
- We design all new offices to meet the Leadership in Energy and Environmental Design (LEED) standard at silver level or higher. At our head office locations, we’re aiming for gold.
- We optimise heating and air-conditioning systems, retrofitting our offices with low-energy LED lighting and introducing automated lighting controls.
- We work closely with our landlords, other businesses and non-profit organisations to share ideas and solutions for reducing office energy use and carbon emissions.
- We share knowledge and best practices through an online toolkit to help teams around the business identify priorities and take appropriate action at each site.
- We select energy efficient equipment such as PC power management tools.
Leaner, greener factories
Less CO2 emissions from energy per tonne of production†
We achieved our 2020 target of reducing CO2 emissions from energy used in our factories by 40% per tonne of production four years ahead of schedule. And we haven’t stopped there. By the end of 2019, we had cut our CO2 emissions from energy by 65%† per tonne of production compared to our 2008 baseline.
Improving energy efficiency cuts emissions and costs. That’s why we’re constantly looking for ways to reduce the amount of energy we need to make our products. By the end of 2019, we had cut the energy we use in our factories by 29% per tonne of production since 2008. Saving energy has also enabled us to avoid costs of around €733 million since 2008.
But energy efficiency can only take us so far in reducing emissions because we will always need energy to make our products. So we’re using renewable energy to help us cut emissions from our factories even further.
Nearly half of our manufacturing energy comes from renewable sources
We use two forms of energy in our manufacturing operations. Around one-third is electricity for lighting and powering machinery. The rest is thermal energy for hot air, hot water and steam.
In 2019, 45.8% of our total energy use – electrical and thermal – across our manufacturing operations came from renewable sources, compared with 15.8% in 2008. To meet our demand for thermal energy from renewable sources, we’re exploring the potential to use new technologies. These include heat pumps, concentrated solar power, biogas, biomass and hydrogen. Many of these options are not yet commercially viable or widely available, so we are supporting innovation and looking for ways to integrate them into our operations.
Coal is the biggest global source of man-made CO2 emissions and the dirtiest fossil fuel – and we're committed to eliminating direct coal from our energy mix by the end of 2020. In a small number of our manufacturing sites, we still use coal-fired furnaces to generate heat or power on site. In 2019, 822,059 GJ of the energy used at 12 of our manufacturing sites was generated from coal. How we’re phasing out coal varies by site depending on the options available locally.
In fact, 24 of our sites globally are now carbon neutral. This means they have reduced their net impact on CO2 levels in the atmosphere to zero by replacing energy from fossil fuels with energy from renewable sources. We’re pushing for regulatory changes to move more swiftly away from using fossil fuels.
In the UK and Ireland, for example, our food and drinks factories in Trafford Park and Cork have been powered by a combination of renewable electricity from the grid and renewable biomethane (also known as biogas) since 2017 – as have our offices in Surrey and London. The biomethane is generated from anaerobic digestion, which converts inedible food waste and sewage into energy. And it’s fully traceable and certified.
From by-products to biomass
Biomass and biogas will play an important role in our transition away from fossil fuels, particularly as an alternative to conventional gas or coal for heating.
In Brazil, the new biomass boiler we installed at our Valinhos site in 2019 will reduce CO2 emissions by over 8,000 tonnes per year.
In 2019, 67 of our manufacturing sites used biomass or biogas, such as agricultural by-products and wood waste. This reduced our annual CO2 emissions by over 380,000 tonnes.
We also produce our own biogas at some sites, using by-products from our manufacturing processes. At our Burton site in the UK, for example, we convert a by-product from making Marmite into biogas, which we use in our boilers.
This work contributes to the following UN Sustainable Development Goals
Switching to renewable grid electricity
We are a founding signatory of the RE100 global campaign for leading businesses to commit to using 100% renewable electricity. This means moving away from electricity generated using fossil fuels to power produced from biomass (including biogas), geothermal, solar, water or wind sources.
As far as possible, we aim to source renewable energy directly through on-site generation or by supporting the development of local renewable energy markets through the energy we buy. Renewable electricity is generated at 35 of our manufacturing sites, mostly from solar and hydro power. By the end of 2019, we had solar arrays (collections of multiple solar panels) at Unilever sites in 13 countries.
Renewable Energy Certificates (RECs) play an important role in helping us track the sourcing of our electricity purchased from the grid from renewable sources. 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 use RECs alongside other options, such as the direct purchase of renewable electricity.
Where we don’t produce our own renewable electricity, we make direct purchase agreements with large-scale solar, wind, hydro and geothermal installations. In the Philippines, for example, we’re sourcing all of our electricity from a geothermal power plant.
100% renewable grid electricity globally
Averaged over our 2019 reporting period (1 October 2018 – 30 September 2019), 85% of all the grid electricity used in our manufacturing operations was generated from renewable resources. Since September 2019, we have been operating with 100% renewable grid electricity across five continents in our manufacturing operations. This will be extended to all continents in 2020.
As far as possible, our transition to renewable electricity has been achieved through supporting the development of local renewable energy markets. This ensures there is plenty of renewable electricity for both us and others to use. According to Anuvrat Joshi, Business Development Director at Cleantech Solar, one of our supplier partners in India, “Through our partnership with Unilever, we will potentially be generating about three million units of energy every year. That’s the equivalent of planting nearly 5,000 trees.”
We’re also generating our own renewable electricity. In Italy, for example, a wind farm at Avellino powers five of our sites, which could reduce our environmental impact by over 7,000 tonnes of CO2 emissions per year. And our operations in Russia, Ukraine and Belarus are powered by a mix of 75% wind and 25% solar energy. We have on-site solar installations at our facilities in 13 countries.
In the UK and Ireland, ten of our sites use renewable electricity from an onshore wind farm in the Scottish Highlands. We’re also advocating for increased investment in offshore wind power in the UK, together with other businesses and NGOs such as SSE, Greenpeace and the WWF.
Now that we have achieved 100% renewable grid electricity, we’re working to get our entire energy supply from renewable sources. We currently have 24 sites around the world are completely carbon neutral. Our goal is to become entirely carbon neutral across the business before 2030.
This work contributes to the following UN Sustainable Development Goals
Investing in on-site renewables through internal carbon pricing
Carbon pricing is designed to ensure that climate risk is part and parcel of financial decisions by putting a monetary price on the carbon emissions emitted. We use carbon pricing in our business case calculations and we’ve signed the World Bank’s carbon pricing statement to encourage others to do the same.
Since 2016, we have set our own internal price on carbon: €30 per tonne emitted, increasing to €40 per tonne in 2018. In January 2018, it increased as part of the business case appraisal for large capital expenditure projects. However, this didn’t change behaviour as we expected since energy costs – and consequently carbon costs – were largely immaterial to the capital costs over the assessed period.
As a result, we took the decision to end this shadow carbon pricing approach. Instead, we’ve applied a novel approach of internally taxing the notional capital expenditure budgets of our three Divisions – Home Care, Beauty & Personal Care and Foods & Refreshment – based on the emissions from the prior year.
So far, over €120 million has been allocated to our Clean Technology Fund for energy, waste and water-saving projects. Projects funded to date include solar water heating systems at sites in Australia, Israel, Mexico and India that together will reduce CO2 emissions by around 1,500 tonnes per year, and a biomass boiler at our Tema factory in Ghana. We increased our carbon price again to €50 per tonne in 2020 and expect it to increase to help achieve our 100% renewable energy across our operations by 2030 target.
Insight: Changing the world through renewables
Andrea Rickert-Pulvermann, Procurement Manager
“My job is to help Unilever achieve net zero carbon emissions. That means no longer using fossil fuels and supporting the generation of more renewable energy than we consume. Essentially, it’s about doing our bit to help the world transition to a low-carbon economy.
“We use two types of energy in our operations. Thermal energy – for heating and cooling – is used mainly in the form of steam and hot water for manufacturing. This is managed by our sustainable manufacturing team. And electrical energy – power – is needed for things like lighting and running machinery. My role focuses on electrical energy but also supports the sustainable manufacturing team in sourcing feedstocks to produce thermal energy.
“I work in our centre of expertise for renewable energy procurement and waste management services. We develop strategies, set standards, track what’s going on in the outside world, and ultimately help teams put programmes in place locally. Governments often use energy as a political tool to boost the economy, win an election or drive their climate change targets. That’s why I find energy procurement so interesting. What we can do in each country really depends on national energy legislation. In large countries, like India and China, legislation can even vary between states or provinces.
“It’s amazing how fast things have moved on from where we were in 2015 when we set our most recent goals on renewable energy. We got off to a slow start, because it was a relatively new – and challenging – concept for people to understand. But in the last couple of years, we’ve made exciting progress.
“What keeps me awake at night is the fact that in countries where electricity is scarce and grids are unstable many people lack access to secure supplies of power. This can impact their opportunities and quality of life. Our work to support the growth of renewable electricity supply in these places makes a huge difference. We cannot achieve our goals alone.
We need to work with partners, suppliers, and governments to help build a sustainable energy system that meets the needs of people and the economy, without contributing to climate change. Because together, through renewables, we can literally change the world.”
Tackling our distribution footprint & achieving our USLP target
Fuller trucks, more efficient journeys, alternative fuels. We’re looking at all the options to cut CO2 emissions from our distribution – getting our products to our customers.
By the end of 2019, we had cut our logistics CO2 emissions (from road, rail and warehouse storage per tonne of products sold) by 41% since 2010 – achieving our Unilever Sustainable Living Plan (USLP) target a year ahead of schedule. We measure our emissions using the tank-to-wheel approach – that is, the fuel used in the vehicle.
We don’t usually own the trucks, trains and ships used to transport our products so we work closely with our logistics partners to reduce emissions by using more efficient vehicles and lower-carbon alternative fuels. We’re also involved in several cross-sector sustainable transport initiatives aimed at creating wider change.
Did you know?
Our distribution network transports our finished goods over 1.5 billion kilometres each year from our factories to where they’re sold – that’s the equivalent of travelling to the moon and back twice every day.
So how do we do this as efficiently as possible?
- We locate our distribution centres in places that enable efficient transport from our factories to our customers.
- We plan each journey to choose the most efficient route.
- We use rail and sea freight where feasible – or intermodal transport, switching from road to rail and sea.
- We fill each lorry as full as possible to optimise use of space and weight allowances.
- We explore new ways to reduce emissions through technical innovation and alternative fuels.
- We encourage our logistics suppliers to train their drivers on eco-efficient driving techniques.
Delivering transport emissions reductions
Filling trucks fuller cuts fuel costs and emissions by transporting more products in one go with less wasted space. We’ve increased truck load fill rates in Mexico by over 10% through smarter route planning and pallet configuration. Double-decker trailers are enabling 16% more products to be transported per journey in the Philippines. And in India, we’ve improved how we select and load trucks so we pick the right vehicle for each job. We’ve also reduced the number of distribution centres and introduced more deliveries direct to customers to avoid unnecessary journeys.
Driver behaviour can make a big difference in cutting fuel use and CO2 emissions on road journeys. We encourage our logistics providers to train drivers on eco-efficient driving techniques, and they share their progress with us twice a year. To support drivers’ health and well-being, we’ve reviewed the facilities across 148 of our warehouses globally to check that we provide safe and secure parking zones, comfortable rest areas and good toilet facilities.
Technical innovation also has a role in making transport as efficient as possible. For example, in the US, we use thermal insulated blankets that enable some temperature-sensitive shipments to be transported in normal trailers.
We’ve been trialling the world’s first clean cold engine to deliver ice cream to our customers in the Netherlands. It uses liquid nitrogen instead of diesel to produce clean power and cold air with zero CO2 or particulate emissions. In partnership with the Dearman Engine Company, we trialled a new technology to provide clean cooling for our refrigerated trailers through the use of liquid nitrogen, where the only emissions are air or nitrogen. The truck travelled more than 18,000km to collect and deliver Ben & Jerry’s and Ola ice cream – all powered by clean cold air.
Using alternative fuels to cut CO2 emissions
We’re looking to alternative fuels to help us cut CO2 emissions from our trucks and reduce our costs. We have trials underway around the world and we increased our use of alternative fuels by 4% overall in 2019 compared to 2018. One option we’re exploring is liquefied natural gas (LNG). It has many advantages compared with diesel: up to 11% less CO2, 95% less particulate matter, 50% less noise pollution from trucks – and it’s often cheaper too. But a lack of fuelling stations is a major obstacle to wider use, especially for long-distance journeys.
Several of our logistics partners have begun using LNG in parts of Europe and northern Asia, transporting our goods more than 3 million kilometres per year. And we’re using compressed natural gas (CNG) as an alternative to diesel in India, Turkey and the US. In Sweden, we’ve successfully trialled the use of hydrotreated vegetable oil (HVO100), a renewable diesel made from waste fats and vegetable oils. This odourless fuel can be used in conventional diesel engine fuel systems and can cut CO2 emissions by up to 90%, carbon monoxide by over 20% and hydrocarbons by 30%.
We see CNG and LNG as transition fuels on our journey to low-carbon logistics. In the long term, we need fuels that will enable us to achieve even bigger cuts in our transport footprint, such as hydrogen and biogas.
Switching to electric vehicles can also dramatically reduce CO2 emissions and fuel costs. In the US, Europe and China we’re working with suppliers to explore the use of electric trucks to transport our products. We have been using hybrid vehicles – diesel and electric – in Mexico since 2017. As part of the Dutch Sustainable Growth Coalition, we supported the trial of 20% biofuel blend use in long-haul ocean shipping in partnership with Maersk. The results of the pilot have been encouraging and we are now evaluating it for commercial deployment across Unilever.
We’ll continue to explore low and zero-carbon alternatives, and how we can overcome obstacles to their use such as gaps in worldwide infrastructure, technology and the availability of sufficiently powerful engines.
This work contributes to the following UN Sustainable Development Goals
Driving progress on greener logistics
Mark Rickhoff, Logistics Manager, Benelux
“Our strategy rests on two pillars: reducing the kilometres we need to travel and greening the kilometres we have to travel. It’s seen us developing ways to fill our trucks more efficiently and shrink the distances travelled across our network. Greening the kilometres we have to travel is more complex and involves investing in new technologies and alternative fuels. We have an industry that wants to transition away from diesel, but without readily available zero emission alternatives on the market. We need heavy goods vehicles that can carry large volumes without contributing to air pollution and climate change.
“But change is coming. In 2019 the European Commission introduced binding CO2 reduction targets for trucks in the EU, including a stimulus for the development of zero and low-emission trucks. The year 2020 could be the breakthrough year for electric passenger cars. Heavy duty vehicles will take longer. There is a lot of excitement about the first generation of hydrogen and battery-powered electric trucks and there are plenty of signals that the industry is getting ready. But it’s not going to happen overnight.
“To move forward and continue reducing emissions today, fleets have to look at transition fuels. These are fuels that are cleaner than diesel but still contribute to climate change and air pollution. For example, in the Netherlands we have a fleet running on liquefied natural gas (LNG) which has lower carbon dioxide, nitrogen oxide and particulate matter emissions when compared to diesel.
“What’s challenging is waiting for industry thinking and infrastructure to catch up with the potential of the new fuels available. With LNG we faced a chicken-and-egg situation where the fuel was viable, but Europe’s roads didn’t offer a sufficiently large network of LNG fuelling stations to ensure that our trucks could complete their journeys. This led to our setting up a consortium, Connect2LNG, to build five LNG fuelling stations in France and Germany because you can’t have LNG-powered trucks without the infrastructure there to support them.
“Our aim was to kickstart greater LNG use across Europe and it is not happening at scale – yet. That is part of working on new things. Every success is built on learning from failures. You just have to stay committed to positive change to navigate through the difficult times. There is no ‘one size fits all’ solution. The industry needs to work to get there together along many different pathways. With the help of our logistics suppliers we can drive forward the market for greener solutions.”
Keeping cool with climate-friendly freezers
Our ice creams – brands like Wall’s, Algida, Ben & Jerry’s and Kibon – are sold from more than 3 million freezer cabinets in over 45 countries. The refrigerants and energy used to keep them cold can have a significant climate footprint.
Freezers are designed to keep refrigerants sealed inside. But if they leak, refrigerant gases such as hydrofluorocarbon (HFC) have a global warming impact thousands of times greater than CO2. That’s why we pioneered the use of natural hydrocarbon refrigerants (HCs). Since 2004, we’ve purchased around 2.9 million freezers containing natural refrigerants and it is mandatory that any new freezers we purchase use HCs rather than HFCs.
We’re continually innovating and collaborating with freezer manufacturers to improve the efficiency of the freezers we buy. This helps to reduce indirect emissions from energy use. And it also reduces running costs for our customers as our freezers are generally owned and operated by us with retailers paying the electricity bill in stores.
To further reduce emissions, we’re also exploring the use of renewable energy to directly power our freezers. We’ve completed trials of mobile solar-powered ice cream cabinets in India and the US. These can work for up to ten hours using solar power alone and recharge overnight from the electricity grid using just 10% of the energy needed to run a standard freezer. We are now refining the mobile solar units and developing solar-powered static freezers.
Freezers on the frontline
Stephen Breen, Research & Development Manager
“It’s easy to get motivated about energy reduction and natural refrigerants. I’m an engineer by training and an environmentalist at heart. Environmental challenges like climate change cannot be solved by doing things on a small scale. A quantum shift is needed, and industry has a huge part to play.
"When I joined Unilever four and a half years ago, a huge amount had already been achieved – our freezers purchased today use half the energy they did ten years ago. In some respects, that means the job of energy reduction is getting harder and harder so we have to be even more innovative. The key focus is on ensuring energy-efficient freezers are as cost effective for the business as possible. Renewable energy is also a focus and it’s been fantastic to see our first solar-powered ice cream cabinets being trialled.
"A big part of our job is working with suppliers and communicating our requirements – most innovation comes from collaborating through the supply chain. By showing suppliers the demand is there, we can help bring these innovations to the commercial market more quickly. Everything we do is a team effort, both within Unilever and with suppliers. We couldn’t have achieved the progress we’ve made without everyone working together.”
Collaboration is key for a low-carbon future
Our focus on improving efficiency, embracing new technologies and investing in renewable energy has enabled us to make significant inroads in reducing the carbon footprint of our operations. But it’s becoming more challenging to make further reductions.
Often, the obstacles we face are outside our control because the technology or the infrastructure simply isn’t yet in place. We cannot create a low-carbon economy alone. But we recognise we have a role to play as an industry leader, using our scale and influence to drive wider systems change.
For example, we’re calling for increased government and private investment in renewable energy infrastructure to enable lower-carbon energy markets worldwide. We’re advocating for governments and businesses to reduce the GHG impact of freezers through the Consumer Goods Forum. And we’re collaborating to explore lower-carbon transport options, including the use of LNG for freight through the Connect2LNG consortium in collaboration with the European Commission.
Working with others to promote systems change will help us cut our own carbon footprint and accelerate climate action on a much wider scale.
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 (scope 3). Our second science-based target is sourcing 100% of our energy across our operations from renewable sources by 2030 (scope 1 and 2). Both have been validated by SBTi.