Vestas towards carbon neutrality

Lisa Ekstrand
Senior Director and Head of Sustainability at Vestas

Published on 4th of June 2020

Throughout this January and February, Vestas announced its new sustainability strategy: “Sustainability in everything we do”. Underlining Vestas’ vision to improve its sustainability performance, the strategy established four ambitious goals to measure our progress - one of which is a pledge to become carbon-neutral by 2030 without using carbon offsets, followed by commitments to reduce CO2 emissions within our supply chain by 45% per MWh generated by 2030.

At Vestas, we believe that we have an ethical obligation to hold ourselves accountable for the impact we have on our planet. Driven by our passion to build a greener tomorrow, we pledge to improve our track record in sustainability by introducing new initiatives across the organisation. We actively seek to tackle some of our generation’s most critical challenges whilst striving to safeguard the interests of future generations. 

Following the announcement of the sustainability strategy we now have a big execution task in front of us. Just as devising the strategy involved a larger number of colleagues from most functional areas, the implementation will require a huge collaborative effort from across the entire organisation.

In this article, we will unpack our commitment to reducing our carbon footprint, a project led by Lilian Harbak in Global Quality. Safety and Environment. I met with Lilian recently to understand her perspective on the journey ahead.

Can you give some background on your role at Vestas?

I am a Global Subject Matter Expert within Environmental Performance tasked to develop and drive Vestas’ strategic initiatives for improving environmental performance in cooperation with relevant stakeholders. I have been working with Vestas for 10 years within sustainability reporting as well as safety and environmental performance.

How did you contribute to developing this target? 

I’ve been involved with sustainability in Vestas since the beginning. From setting targets to reduce our product carbon footprint in 2010, to setting Science Based Targets for reducing CO2 emissions in the value chain in 2019. Since our commitment to Science Based Targets was published in April 2019, I’ve been working with colleagues and an external consultant (Navigant) to specify the carbon neutral target, which was then publicly announced in January of this year. Now my role is to define and drive the project of reaching these targets.

What is your immediate reaction to this new target?

It is very ambitious but also necessary given the projected growth of the wind industry. As the global leader in wind, we have an obligation to drive the transition to renewable energy and reduce CO2 emissions. We don’t have all the solutions yet, but with a combined effort of Vestas employees, suppliers and customers we can mobilise the necessary innovation and development.

We have always seen sustainability as a key element behind our business. But as our industry, and the need and expectations of our partners evolve, we have come to see an urgent need for reassessment. In order to be a company that truly acts in the best interests of future generations, the notion of sustainability cannot merely remain a concept behind our products but must become an integral part of everything we do.

How is Vestas doing in terms of its current carbon footprint?

From 2010, Vestas has set targets to reduce our product carbon footprint. The targets we have established are informed by the Life Cycle Assessments (LCAs) that measure the ‘cradle to grave’ environmental impacts of Vestas’ products and activities throughout the lifetime of a wind power plant. Significant reductions have been achieved through increased power production and optimisation of our turbines to reduce material requirements per kWh delivered.

To address the target of becoming carbon-neutral by 2030, we will now expand our focus beyond the carbon footprint of our products, to the carbon footprint of all our activities, across the entire value chain. 

In our own activities the main sources of CO2 emissions are the fossil fuels used at our factories and in-service vans. In our supply chain the main sources of CO2 emissions are the materials used in our turbines; these include steel, iron and composite materials used in our blades. The logistics of delivering goods to our factories and components from factories to installation sites are another large contributor to the CO2 emissions in our supply chain. These are the areas that will need most attention to reduce our carbon footprint.

How will we become carbon neutral? 

We will buy all electricity and heating from renewable sources and replace all use of fossil fuels with renewable energy sources. In our electricity consumption, we will no longer compensate with own wind farms and will instead buy renewable energy certificates in the countries where the electricity is used.

We have already implemented a new policy for company cars. By 1 January 2020, Vestas will only offer plug-in hybrids and electric vehicles. By 1 January 2025, Vestas will only have zero-emission benefit cars. A program for installation of charging stations has already begun.

For service vans, we are starting this year with pilots testing the use of electric vehicles in a number of markets. Insights from the pilots will be collected to inform the transition of the service vehicle fleet to vehicles fuelled by renewable energy. Our target is that by 2025 all new service vans should be electric or fuelled by  renewable energy. 

Our factories are, to a large extent, heated by natural gas. This use of fossil fuels must be changed to renewable energy sources such as electric heat pumps or solar heating. Similarly moving the heavy turbine components at our factories requires large equipment that uses fossil fuels. 

Can you explain the term "without using carbon offsets"?

Carbon offsetting means that companies invest in environmental projects around the world in order to balance out their own carbon footprints. The projects are usually based in developing countries and most commonly are designed to reduce future emissions. an example of this is moving from coal to natural gas or soaking up CO2 directly from the air through the planting of trees.

The problem with carbon offsets is that it can be very difficult to validate wether the project being invested in are credible, measurable, permanent and definitely would not have taken place without the finance provided by the sale of credits. Vestas wants to lead the transition to renewable energy and achieve net-zero emissions in our own operations. This means that instead of reducing our overall carbon footprint through offsets, we will make conscious adjustments to operations across our entire value chain to eliminate CO2 emissions. 

What are the overall challenges of becoming carbon neutral?

Becoming carbon neutral requires a lot of planning, both in changing existing activities and when developing new activities. In order execute on this transition in the most cost-efficient way, we need to understand our energy consumption and find ways to make it more efficient. The next step is then to find technical solutions that fulfil our requirements. In some cases, these technical solutions are not developed yet or are still too expensive. We must thoroughly plan both our operations and the incremental transition to renewable energy.

Why a separate target for reducing CO2 emissions in our supply chain?

As most of our CO2 emissions relate to our supply chain, we do not believe reducing CO2 emissions in our own operations is enough. In order to make sustainability a part of everything we do, we are therefore also committing to reduce CO2 emissions in our supply chain with 45% per MWh generated by 2030.

The CO2 emissions in our supply chain are calculated partly with the life cycle assessments of our turbines and partly with estimates based on our spend in CAPEX and business services. We have set a target for two thirds of the CO2 emission in our supply chain in line with what is required to keep global warming below 1.5 degrees C.

We will work closely with our key suppliers to get them to reduce their CO2 emissions by 45% relative to the amount of product they sell to us. For this purpose, we are actively seeking sustainability partnerships with our suppliers. Moreover, improvements in the efficiency of our turbines will also count towards achieving the target.

The target is to reduce CO2 emissions in our supply chain by 45 % per MWh. Why is the target set in percent per MWh generated and what will that mean?

The measurement has been chosen because it incentivizes sustainability partnerships with suppliers that both reduce CO2 emissions and allow for the continued growth of the global renewable energy sector, all while keeping the absolute emission level stable.

How are Vestas employees going to be involved in this transition?

We will engage employees in both company-wide and local activities. Within our efforts to increase energy efficiency and transition to renewable energy, our employees will be a valuable source of ideas for improvement. In some areas, employees influence our energy consumption directly through their behaviour, therefore it will be important to raise awareness of how to optimize energy consumption within the organization.

What recommendations would you have for other companies to become carbon neutral?

We have only just started on our journey and are actively seeking inspiration from other companies that are further along this path. The more we can work together in partnerships the more effectively we can drive synergies during the transition to renewable energy. 

With our new strategy we are shifting our approach from "sustainability is the business we are in", to "sustainability in everything we do". This is the key if we want to be the global leader in sustainable energy solutions, becoming carbon neutral will be a significant milestone in this journey.

If  you have any questions regarding Vestas’ sustainability strategy or any of our targets, please do not hesitate to contact the Sustainability Department at vestassustainability@vestas.com