Energy efficiency improvements
Our energy efficiency improvement (on primary energy) was 5.7%1 versus 2019, above our target of an average annual improvement of 1%. This is mainly due to improvements in the production process during the scaling up of one of our new ventures. These improvements resulting in much lower energy use per ton produced. Excluding this effect, the energy efficiency improvement was 1.9%, which was mainly due to our GHG reduction program and general efficiency improvements.
Projects executed in 2019 began delivering results in 2020, adding up to approximately 26 kt CO2eq reduction on the 2020 emissions. Examples of projects resulting in lower energy use are the replacement of chillers for building cooling in Greenville (North Carolina, USA) with a state-of-the-art version with much lower energy consumption, contributing approximately 2.7 kt CO2eq. In Jiangshan (Jiangsu Province, China), the installation of a membrane filtration system to pre-concentrate a product solution, significantly reducing the amount of required steam, contributed about 6 kt CO2eq. In Lalden (Switzerland), several smaller projects, such as returning condensate and continuous monitoring of steam leakages resulted in energy efficiency improvement and approximately 2 kt CO2eq reduction.
We are a proud member of the Climate Group’s RE100, comprising leading companies that have committed to sourcing 100% of their electricity from renewable sources at the earliest possible opportunity. Our commitment is to source 75% of our electricity from renewable sources latest by 2030 and 100% at the earliest possible opportunity.
In 2020, we once again made significant steps towards our purchased renewable electricity target. The percentage of purchased electricity from renewable sources increased globally from 50% in 2019 to 60% in 2020. The CO2eq reduction due to this increase was offset by a lower demand in renewable electricity in high-emission regions and by the current growth in non-renewable electricity in China.
Progress on purchased renewable electricity in Europe
For our operations in Europe, we concluded a new Power Purchase Agreement (PPA) to source renewable electricity from one wind farm and two solar power plants in Spain, which will commence production in 2022–2023. In the Netherlands, our portfolio of agreements continued to provide 100% purchased electricity from wind parks to all locations. All other sites in Europe were also using 100% renewable electricity due to existing agreements combined with pre-production guarantees of origin (GOs) from the new PPA.
Progress on purchased renewable electricity in North America
Two PPAs are in place in the US, one for electricity generated from wind, while the assets for the second one are to be built and will provide solar-powered electricity. The production from the first agreement combined with pre-production renewable energy certificates (RECs) from the second agreement means we have around two-thirds coverage of purchased electricity from renewable resources in North America in 2020, in line with 2019. The agreement for additional renewable electricity production announced in 2019 plus additional expected progress will lift this percentage toward 100% in 2021.
Working on renewable energy for heat and steam
Next to significant steps taken to increase the ratio of purchased renewable electricity, we also look for opportunities for the broader use of renewable energy sources. Sites across DSM already recover waste streams for production of renewable energy while others are in an exploratory phase. For example, an anaerobic digestor in Jiangshan (Jiangsu Province, China) enables the production of biogas from wastewater. At the end of 2020, Chifeng (Inner Mongolia, China) purchased steam produced from biomass residues. The biomass cogeneration plant in Sisseln (Switzerland) reached full year capacity in 2020, enabling a further reduction in GHG emissions of 6 kt CO2eq versus 2019.
In 2020, we continued to make progress in order to expand the portfolio of purchased renewable fuels in a responsible way. We worked throughout 2020 with a cross-functional team to establish comprehensive sustainability criteria for our purchased biomass-based fuels and heat. Pilot work started in 2020 and will continue during 2021. The new framework aims to ensure that any step taken in this direction supports the responsible transition toward decarbonized operations and to further expand sustainable renewable energy consumption in DSM.
1 All data presented in Planet are subject to the non-financial reporting policy.
Primary energy is energy that has not yet been subjected to a human engineered conversion process. It is the energy contained in unprocessed fuels.
Final (consumed) energy is the energy that is consumed by end-users. The difference between primary energy and final consumed energy is caused by the conversion process between the two as well as any transmission losses.