Arla Foods Consolidated Annual Report 2021
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Arla Foods Consolidated Annual Report 2021 / Environmental, social and governance (ESG) data / Notes
Environmental figures
1.2 RENEWABLE ENERGY SHARE
Contents
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GOD SHARE OF RENEWABLE ENERGY INCREASED
The use of energy, including heat and electricity, at
Arla's sites contributes to climate change, depletion of
non-renewable resources and pollution. As a result,
switching from fossil to renewable energy is an
important lever to fulfil Arla's climate ambition and
reduce the carbon footprint from scope 1 and 2
emissions.
The renewable energy share increased to 33 per cent in
2021 compared to 31 per cent last year. The ratio was
positively impacted by the purchase of additional green
electricity and biogas in Denmark.
In 2020, the accounting method for renewable energy
was changed from location-based to market-based
accounting. Between 2016 and 2019, Arla purchased a
number of green certificates without accounting for
these in the figures, therefore only 2020-2021 figures
are disclosed in ESG Table 1.2.
G
Accounting policies
Energy usage in production consists of renewable and
fossil-based fuels and electricity. Renewable energy is
energy based on renewable sources, which can be
naturally replenished, such as sun, wind, water, biomass
and geothermal heat. From 2020, Arla measures and
reports emissions based on market-based accounting
and will account for the purchase of green electricity by
contractual agreement in the renewable energy share
calculation. The renewable electricity purchased from
national sources is assessed annually using figures for the
national electricity mix supplied by Sphera, an industry-
leading consultancy firm collecting, assessing and
analysing emission data based on the latest scientific
evidence. To calculate the share of renewables, the
renewable energy use is divided by the group's total
energy use.
Some Arla sites produce and sell excess energy, i.e.
electricity and heat. The energy sold was not deducted
in the calculation of the renewable energy share. The
data presented in ESG Table 1.2 is collected monthly
from Arla's sites. Data for energy consumption is
primarily based on invoice information and automated
meter readings at each site, and therefore there is very
little uncertainty associated with these figures. Arla
does not account for energy losses, therefore all energy
purchased is included in the figures.
ESG Table 1.2 Energy purchased for production
(thousand MWh)
2021
2020
2019
2018
2017
Non-renewable sources:
Natural gas, fuel oil and gas oil
Electricity
District heating
Non-renewable sources
1,773
1,816
634
626
19
5
2,426
2,447
Renewable sources:
Biogas and biomass
563
559
District heating
210
119
Electricity
421
432
Renewable sources
1,194
1,110
Total energy purchased for production
3,620
3,557
Renewable energy share, market-based*
33%
31%
Renenewable energy share, location-based
32%
35%
33%
27%
24%
*In 2020, Arla switched to market-based accounting and the 2020 figures are based on the new method. The renewable energy share based
on national averages (location-based method) was 35 per cent in 2020 and is shown on a separate line.
THE GREEN POWER LOOP PRESENT AND FUTURE
One way of securing green electricity for our operations is by buying Guarantees of Origin (GO) certificates
directly from our farmer owners. This will secure our farmers a better price for their power and provide
Arla access to additional certificates.
PRESENT
Farmer/Owner
Utility company
Any company
FUTURE
100%
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