Our strategy to deliver on our climate ambitions
To drive ambitious emissions reductions in our own operations, we have devised a group-level energy strategy and set up a steering committee for decision making, whose members include the EVP Sustainability and Communications, CFO, EVP Corporate Affairs and Legal, and business segment representatives. The steering committee is the key decision-making forum on large, cross-functional projects such as our virtual power purchase agreements.
Our energy strategy outlines the main levers we work on to reduce our emissions:
- Improve energy efficiency
- Switch to alternative fuels, such as biogas
- Electrification of systems
- Technology development to lower the resource consumption of our manufacturing machinery
- Improve energy efficiency
- Switch to renewable electricity, through Power Purchase Agreements, on site solar installations and purchasing green electricity from the grid
- Supplier engagement, to address emissions originating from the goods and services that we purchase
- Driving systemic change and building efficient recycling systems
Improving energy efficiency across our operations is one of the cornerstones of our energy strategy. This is particularly important given our high growth ambitions – we must constantly find ways to produce more efficiently to counter the emissions arising from growing production. To drive efficiency, Huhtamaki employs a variety of levers, including for example, a consistent focus across all levels of the organization, from management to machine operators, energy treasure hunts, best practice sharing across sites and targeted investments.
Increasing the share of renewable electricity is another critical lever to combat our emissions, as currently a large portion of our Scope 2 emissions relate to purchased electricity. In 2021, we took a major step forward in this area by signing two 10-year Virtual Power Purchase Agreements (VPPA) with the global renewable energy developer BayWa r.e. As part of the VPPAs, BayWa r.e. will build two new solar installations in Spain, bringing a significant addition of renewable energy to the European grid. The two new solar sites have a combined volume of 200 GWh of renewable electricity per year and cover approximately 80% of Huhtamaki’s current electricity usage in Europe. In 2022, we signed a second agreement in the US with a subsidiary of NextEra Resources, LLC., covering 30% of our electricity usage in North America.
In addition to the VPPAs we will, wherever feasible, implement on-site generation of renewable energy, mainly through photovoltaic solar panels on factory roofs. Generating renewable electricity on-site is a cost-efficient way to reduce our GHG emissions associated with the electricity we would otherwise purchase from the local grid.
For further details about our climate strategy, please see our Sustainability Report.