Reducing GHG from Manufacturing

Site-level initiatives continue to help us to reduce greenhouse gas emissions from our manufacturing operations.

Our approach

Lifecycle assessment shows that compared to other parts of our value chain, our manufacturing operations are not particularly energy intensive. However, because of the scale of our business, we continue to focus our efforts on reducing greenhouse gas emissions from energy used in manufacturing.

Targets & Performance

Reduce greenhouse gas emissions from our manufacturing

  • By 2020, CO2 emissions from energy from our factories will be at or below 2008 levels despite significantly higher volumes.

    Reduce GHG from manufacturing:

    This represents a reduction of around 40% per tonne of production.

    Versus a 1995 baseline, this represents a 63% reduction per tonne of production and a 43% absolute reduction.

  • We will more than double our use of renewable energy to 40% of our total energy requirement by 2020.
  • All newly-built factories will aim to have less than half the impact of those in our 2008 baseline.
  • 833,000 fewer tonnes of CO2 from energy produced in 2013 than in 2008 (a reduction of 32% per tonne of production).

    Compared to 1995, this represents a 62% reduction in absolute terms.

  • At end 2013 renewable energy contributed 27% of our total energy use compared to 15.8% in 2008.
  • New factories in India and Turkey started production in 2013. When fully operational each aims to achieve only half the emissions of CO2 from energy compared to a representative 2008 baseline.
  • achieved
  • on-plan
  • off-plan
  • %of target achieved

 

† Independently assured by PwC

Our perspective 

Emissions reduction performance during 2013 shows consistent progress towards our 2020 goals. During 2013 we reduced absolute emissions compared to 2012 despite production volume growth during this period. Absolute emissions remain significantly (30%) below our 2008 baseline consistent with our target. This is the equivalent of taking over 200,000 cars off the road. Emissions reduction was achieved through continued reduction in energy use, with a further 3% reduction per tonne of production during 2013. Energy use per tonne of production is now approximately 14% lower than in 2008.

Biomass fuels used on site now comprise more than 13% of all fuels used in our factories. During 2013 we continued our targeted investment in biomass to reduce reliance on fossil fuels.

Three new biomass boilers came on line in South Asia that utilise agricultural residues such as mustard seed husks, rice husk, ground nut shell and sawdust. These are good examples of our investment strategy in opportunities where a sustainable supply of biomass fuel is available and the use of biomass is cost effective compared to the fossil fuel alternative. In these examples, replacing oil-fired boilers with biomass-fuelled boilers achieves a financial return on investment of typically less than two years. This reduces emissions from fossil fuels by around 9,000 tonnes per year.

Since our 2008 baseline we have achieved over €150 million of cumulative supply chain cost avoidance through reduction of energy and switching to lower carbon fuels. We are making significant progress towards our 2020 renewable energy goal. 48 of our manufacturing sites now use biomass fuels and/or renewable energy generated on site. All our sites in the US now purchase electricity from certified renewable sources, as well as all those in Europe and Canada.

Our new factories now have sustainability built into their core designs. In addition to eco-efficient design of production processes, we are using certification systems such as LEED and BREEAM environmental assessment methods and rating systems. We have targeted a minimum certification standard of LEED Silver or equivalent. Our new Home Care factory in Tianjin, China exceeded our minimum standard and was the first Unilever greenfield factory to achieve LEED Gold certification in sustainable design and construction.

The development of eco-efficient core designs for new factories that embed our global experience of category best practice supports our approach of design once, deploy everywhere.

Reducing our energy use

In 2013, energy use decreased by 3% per tonne of production compared to the previous year and was 14% lower than in 2008. Absolute energy use also reduced despite an increase in production over this period.

Since 1995, we have achieved a 48% reduction in energy use per tonne of production (50% reduction in absolute terms).

The biggest contributors to our reductions in energy use in 2013 were:

  • Energy saving through efficient use of heat within manufacturing facilities, driven by a total productive maintenance approach (eg loss analysis and focused improvement projects). 

  • Increased awareness and encouraging our people to adopt small actions, which collectively make a big difference, such as ensuring lights and equipment are turned off when not being used. 

  • Adoption of ‘simple solutions’ for how we operate our sites. 

  • Investment in additional monitoring and metering of energy use within our sites to track performance and identify additional opportunities to reduce energy use. 

  • Efficient equipment replacement process to ensure that any equipment being replaced is to the highest eco-efficiency standard. 

  • Investment in energy efficiency projects via our Small Actions Big Difference global fund described below.

We are collecting information regarding costs via our Environmental Performance Reporting system from each manufacturing site for each energy type. This enables us to measure the financial benefits of our eco-efficiency programme. Reducing energy use has contributed to cumulative supply chain cost avoidance of over €350 million since 2008. This clear financial benefit reinforces our belief that sustainability is good for business.

Over €350 million costs avoided

Since 2008, our manufacturing eco-efficiency programme has used a number of cost-effective investments to reduce our energy, water and waste. Initiatives range from encouraging people to adopt small actions that make a big difference cumulatively, such as ensuring lights are turned off, to larger investments such as biomass boilers. We have reduced our environmental footprint while avoiding cumulative supply chain costs of over €350 million.

  • Water €26 million 

  • Energy €153 million 

  • Waste disposal €17 million 

  • Materials €182 million

In 2013, we again saw improvements in our two key performance measures expressed on a load per tonne of production basis: energy use (in gigajoules (GJ/tonne)) and CO2 from energy (in kg CO2/tonne).

CO2 from energy - Load per tonne of production (1995-2013)

 

2013 data = 1 October 2012 - 30 September 2013. Previous years are calendar year (1 January to 31 December).

In 2013, CO2 from energy fell by 5.2% per tonne of production compared to the previous year and 32% compared to 2008.†

Our reduction of 32% per tonne of production since 2008 has been achieved through energy reduction and supported by the purchase of renewable electrical energy and the use of biomass in our boilers.

The following are some of the biggest contributors to our reductions in CO2 from energy:

  • Energy savings through adoption of a wide range of behaviours and technologies.

  • Investment in renewable energy technologies. 48 of our 247 manufacturing sites now use renewable fuels or other renewable energy generated on site.

Energy - Load per tonne of production (1995-2013)

 

2013 data = 1 October 2012 - 30 September 2013. Previous years are calendar year (1 January to 31 December).

How are we making it happen?

Our strategy is to reduce our energy use and therefore the resulting greenhouse gas emissions. For example, as new equipment or machinery is replaced in our factories, we ensure it meets the higher standards of eco-efficiency that we have specified. As we continue to grow our business, we continue to introduce more technology which can help to reduce our environmental footprint.

Many employees have sustainable business ideas and our manufacturing team has set up a unique Small Actions Big Difference (SABD) global fund to make them happen. Factory teams can apply for investment for their ideas which are evaluated on the basis of environmental benefit and financial return to ensure that only the best projects are selected.

In 2013, we invested €10 million in 125 of the best energy and emissions reduction projects globally which will reduce global CO2 emissions by 2.5% and global energy use by 2%, achieving an average payback of less than two years.

Examples of implemented projects, whose Small Actions collectively deliver a Big Difference, include: 

  • Improvements to compressed air systems 

  • Installing energy efficient lighting 

  • Lagging to reduce heat losses 

  • Steam condensate recovery 

  • Process optimisation and increased production efficiencies 

  • High efficiency electrical motors 

  • Reuse of by-products of manufacturing processes – used as fuels to reduce use of fossil fuels.  

We are finding that successful projects from one factory can in many cases be easily replicated elsewhere. This also ensures a quicker delivery of the environmental benefits. Supporting the best ideas identified by our factory teams through investment in individual projects and then rolling them out globally provides strong motivation to generate new ideas. We will therefore continue our SABD investment programme in 2014 and beyond to leverage our global scale. 

The importance of behaviour change

Everyone in our company has a part to play in reaching the targets that form our Unilever Sustainable Living Plan.

In April 2013 we launched a global campaign to drive eco-efficiency across our global factory network to reach as many Unilever employees and their families as we could. We asked them to think about simple ideas that everyone can engage with to help us reduce our environmental footprint.

Involving our people in learning how to live and work more sustainably helped us reach teams in 96% of our factories during 2013 through the Smarter Greener Living (SGL) campaign. The events involved 86,230 employees and families who collectively contributed over 4,500 eco-efficiency ideas to help Unilever reduce its environmental impact.

Energy efficiency & new factory design

As we grow our business, new factory design is playing a significant role in delivering our eco-efficiency targets. We aim for all newly built factories to have less than half the GHG impact of those in our 2008 baseline – much of this will be achieved through minimising energy use.

We assess the performance of new factories against their USLP targets following a period of commissioning when the throughput and operation of the factory approach the intended new design levels.

The eco-efficient design of our new factories has a significant role to play in maintaining our environmental impact at 2008 levels while we grow our business. Our eco-efficient core designs for new factories supports our approach of design once, deploy everywhere. All of our new factories now have sustainability built into their designs. In addition to eco-efficient design of production processes, we are using certification systems such as LEED and BREEAM environmental assessment methods and rating systems for buildings.

The building housing our new deodorant factory at Khamgaon, India was designed to maximise natural light and heat reflection and reduce ventilation requirements. These design features reduce the energy required for lighting, cooling and ventilation, thus contributing to the sustainable design for the factory as a whole.

Environmental efficiencies at Unilever’s 35th ice cream factory globally at Konya, Turkey include heat recovery to reduce energy use and emissions of CO2. Our new laundry factory at Tianjin, China has been awarded Gold Certification for sustainable design. Energy efficiency is one of the sustainable design criteria.

CO2 emissions from different energy sources

Our manufacturing sites use different sources of energy depending on their production processes and also their geographical location. The following chart shows the CO2 emissions from our different energy sources between 2002 and 2013.

Sources of CO2 emissions by different energy sources (2002-2013)

2013 data = 1 October 2012 - 30 September 2013. Previous years are calendar year (1 January to 31 December).

Elec 0.83
Coal 0.09
Nat Gas incl LPG 0.74
HFO 0.11
LFO 0.09
Other incl steam 0.11

 

Note: The chart does not include GHG emissions from biogenic materials used as fuels of 0.26 million tonnes CO2 which are reported separately from these emissions, in line with the internationally recognised Greenhouse Gas Protocol.

Our renewable energy portfolio

We make a distinction between our on-site initiatives that generate and use renewable energy and the renewable energy purchased from the national electricity grids in the countries where we operate. Of the total energy we used, 27% came from renewable sources in 2013, an increase from 15.8% from 2008.

Of our total, approximately 31% came from our on-site initiatives, largely in developing countries. This includes biomass, solar technologies, hydro-electricity and biogas.

The purchase of certified renewable energy, predominantly in Europe and North America, accounted for approximately 56%, with the remaining 13% coming from the national electricity grids in the countries where we operate. In some countries there is a lack of options for purchasing renewable energy due either to its availability or prohibitive costs. This is one constraint on our progress but we expect the situation to improve.

We are currently investigating other renewable energy opportunities. We are targeting investment in those projects where sustainable sources of renewable fuel/energy are available and renewable energy technologies present a cost effective solution to non-renewable alternatives. Examples include our investment during 2013 in additional biomass boilers for factories in South Asia.

The table below shows the different types of renewable energy we used in 2013.

Internal energy generation or purchased (GJ)

External energy generation (GJ)

Purchased

Certified green power

4,424,533

Renewable electricity from national grids

1,023,956

Generated

Fuel crops

761,134

Solid biomass waste

1,043,014

Wood/wood waste

539,296

Liquid biofuels

74,665

Biogas

18,190

Hydro-electric power

33,467

Solar photovoltaic & thermal

5,402

Totals

6,899,701

1,023,956

Proportion of global energy supply

23.1%

3.4%

Renewable energy

In some cases the cost of renewable energy remains high relative to non-renewable alternatives. The opportunity to introduce renewable technologies on a scale that significantly contributes to our global target is also a challenge. Therefore, we continue to evaluate renewable technologies that are scalable and cost effective to keep us on track to meet our target to double our use of renewable energy by 2020.

The way we buy our energy is a key consideration. During 2012, we increased the proportion of energy we purchased from verified renewable energy schemes. All manufacturing sites in Europe, Canada and the US – more than one-third of all of our manufacturing sites now purchase electricity from renewable sources. The only exception to this is where a site sources electricity from energy-efficient combined heat and power plants.

The resulting reductions in CO2 emissions are estimated at over 500,000 tonnes, equivalent to approximately one fifth of our total emissions worldwide. The approach we took to achieve this in Europe included:

  • Power purchase agreements (PPAs) with national renewable energy producers in countries where liberalised energy markets, governmental incentives and the size of Unilever’s electricity consumption in that country allow it.

  • Purchase of national renewable electricity certificates (RECs) generated in individual countries from a dedicated renewable electricity source.

  • Purchase of RECs from a dedicated hydro power producer which will cover all electricity consumption of those sites where we are not able to implement national renewable electricity initiatives.

Each year, an independent certification company validates the approach we have taken in Europe.

Reducing GHG emissions through biomass

Sustainable sources of biomass present a significant opportunity to increase our use of renewable energy in manufacturing and help us reach our renewable energy target. Investment in biomass boilers is therefore an integral part of our wider manufacturing sustainability strategy to reduce greenhouse gas emissions.

Replacing oil-fired boilers with biomass-fuelled boilers achieves a financial return on investment of less than two years. It reduces emissions from fossil fuels by around 9,000 tonnes per year.

Our targeted approach identifies those projects where a sustainable supply of biomass fuel is available and the use of biomass is cost effective compared to the fossil fuel alternative.

Targeted investment in biomass

During 2013 we continued our targeted investment in biomass to reduce reliance on fossil fuels. Three new biomass boilers came on line in South Asia that utilise agricultural residues such as mustard seed husks, rice husk, ground nut shell and sawdust as well as liquid biofuels and biogas.

We are now using bio-energy at 36 of our manufacturing sites. This reduces our annual emissions from fossil fuels by over 150,000 tonnes of CO2. Biomass fuels used on site now comprise more than 13% of all fuels used in our factories.

Further renewable energy projects in Africa and South Asia will come on line in 2014 and will be fuelled with by-products of Unilever manufacturing processes and imported biomass fuels. These projects will deliver further reduction in emissions from fossil fuels by over 15,000 tonnes of CO2 per annum and reduce our dependence on fuels which are limited in some countries.

Our targeted approach identifies those projects that achieve the greatest environmental and financial return. Further renewable energy projects in Africa and South Asia will come on line in 2014 and will be fuelled with by-products of Unilever manufacturing processes and imported biomass fuels. These projects will deliver further reduction in emissions from fossil fuels by over 15,000 tonnes of CO2 per annum and reduce our dependence on fuels – a limited resource in some countries.

CO2 emissions green house gasses

Our manufacturing sites use different sources of energy depending on their production processes and also their geographical location. The chart below shows in more detail our latest GHG emissions from the energy sources used by our manufacturing sites, together with other site GHG emissions (refrigerant losses, effluent treatment and waste to landfill).

Sources of greenhouse gas emissions by type (2013)

2013 data = 1 October 2012 - 30 September 2013. Previous years are calendar year (1 January to 31 December).

Non-energy sources account for only approximately 3% of our greenhouse gas emissions from manufacturing.

Note: The chart does not include GHG emissions from biogenic material which are reported separately from these emissions, in line with the internationally recognised Greenhouse Gas Protocol.

We did not measure levels of three other major GHGs because Unilever’s emissions of these are negligible. These gases are: nitrous oxide (produced mainly in nitric oxide manufacture), perfluorocarbons (mainly associated with aluminium and magnesium production) and sulphur hexafluoride (used in some electrical equipment).

External recognition

Our Rexdale factory in Canada was the recipient of two awards from GE for its efforts in striking a balance between environmental challenges and industrial demands:

  • The Return on Environment (ROE) Award for surpassing and improving environmental and industrial goals

  • The Proof Not Promises (PNP) award for improving industrial operational performance.

In receiving these awards, Rexdale is in the top 1% of GE customers being honoured for striking a positive balance between today’s environmental, industrial and sustainability challenges.

In 2013 CDP, formerly the Carbon Disclosure Project, recognised our climate change disclosure and carbon performance for the ninth consecutive year. Unilever scored 85 out of 100 for Disclosure. This is an increase of one point on our 2012 score, and six points on 2011. We maintained our Band A performance rating. This result placed us in the Climate Performance Leadership Index (CPLI) for the second year running.

In the 2012-2013 Climate Counts(Link opens in a new window) Company Scorecard, Unilever scored 91 out of 100 points. This was an increase from 88 in 2011 and 83 in 2010. We came top of the food sector. The Climate Counts Company Scorecard rates the 136 largest companies by revenue across 16 industry sectors on their actions to address climate change. Scores are assigned based on 22 criteria that determine if companies have: measured their climate footprint, reduced their impact on global warming, supported (or suggested intent to block) progressive climate legislation and publicly disclosed their climate actions clearly and comprehensively.

Unilever was ranked number two in a new science-based carbon emissions study published by Climate Counts in December 2013. The study analysed the GHG emissions of 100 companies, assessing how well these companies performed in the context of environmental thresholds.

† Independently assured by PwC