Brewing lower carbon emissions

Our approach

Climate change is one of the greatest threats facing society. Its impacts will be far-reaching and have the potential to disrupt our value chain, from supply of raw materials through to the distribution of our products.

DB is committed to significantly reducing its own greenhouse gas emissions and collaborating with its customers and suppliers, and the wider community, to help New Zealand transition to a low carbon economy. In 2019, we announced our ambition to halve our scope 1 and 2 emissions by 2030 (against our 2018 baseline). This science based target is in keeping within a 1.5 degree pathway of warming. We also reaffirmed our commitment to the Climate Leaders Coalition by signing up to the 2019 statement. Globally, HEINEKEN is taking bold action on climate change with a goal to reduce emissions in production by 80% (from 2008) and increase its use of renewable energy to 70% by 2030.

Our scope 1 and 2 emissions primarily come from natural gas, electricity in our breweries, purchased steam, and fuel used by our fleet. Our 2030 reduction plan focuses on energy management and efficiency, and investment in renewable thermal energy solutions that will accelerate our progress.

Our scope 3 emissions mainly come from packaging, agriculture, malting and adjuncts, cooling and logistics. We are developing long-term targets and reduction plans across all areas, building on the progress we have made to date in reducing emissions by right-weighting our glass packaging, optimising our logistics, and implementing our green fridges programme.

Our progress

We have made positive progress towards our ambition to halve scope 1 and 2 emissions by 2030 by achieving an 11% reduction in emissions in 2019, which is in line with our carbon reduction pathway.

During the year, we announced our intention to invest in biomass at our second largest production site, DB Draught Brewery in Timaru. Moving to biomass will eliminate the use of steam derived from coal and lead to an approximate 98% reduction in emissions from steam production. During the year, we partnered with the Energy Efficiency Conservation Authority (EECA) to understand the availability and suitability of local sources of biomass, as well as the feasibility of in-house or third party biomass solutions. While we are continuing to work on the transition to biomass, the impact of COVID-19 to our business has delayed our implementation timeline and we now expect to have a solution in place in 2021.

During the year we also ran feasibility assessments on installing solar photovoltaic (PV) cells at our Waitemata and DB Draught breweries, and solar thermal water heating at Waitemata Brewery. At this time, neither technology is feasible due to a combination of high capital and operational costs with limited impact on reducing our emissions. Natural gas used in our breweries makes up the largest portion of our emissions at 40%, and implementing suitable renewable energy alternatives remains a key challenge. While we don’t have all the solutions, our team is committed to finding the right solutions for our business.

We were however thrilled to install our first electric vehicle (EV) charger at our Waitemata Brewery in May. The charger is available for our staff and visitors to use free of charge. We officially opened the charger for use with Wiebe Wakker, a Dutch sustainability adventurer and EV advocate who completed an astonishing around-the-world journey in his own EV to raise awareness for more sustainable forms of transport.

Energy efficiency remains a key aspect of our carbon reduction strategy and we continue to make incremental gains across our sites. We have been focused on optimising the Cleaning In Place (CIP) or regular wash down programmes at our breweries and cidery to use the least amount of water, electricity and heat. One key initiative undertaken during the year was the cleaning of the wort cooling heat exchanger at our Waitemata Brewery. Wort is the liquid extracted from the mashing process. After several years of use, fouling had accumulated resulting in decreased performance and more energy was required to meet cooling specifications. Our team performed a deep clean, successfully bringing the performance back to expected levels and saving over 13.5 tonnes CO2e (carbon dioxide equivalent). Annual cleaning is now planned to maintain optimum energy efficiency.

Key targets and performance

In 2018, we measured and externally verified our scope 1 and 2 emissions for the first time. Our previous reporting from 2014 to 2018 tracked our emissions in production at our three largest sites. The transition to full scope 1 and 2 reporting provides a more comprehensive and accurate account of our emissions, and our 2018 data forms the baseline of our 2030 carbon reduction target. Between 2018 and 2019, we also changed the way we calculate our emissions from purchased steam. We have previously included emissions from transmission and distribution losses in our calculations, and this will now be included in our scope 3 emissions. As a result, we have revised our science based target pathway with a new baseline of 9,181 tonnes of CO2e and 2030 target of 4,554 tonnes of CO2e.

DB’s scope 1 and 2 emissions in 2019 were 8,149 tonnes of CO2e or 6.21kg CO2e per hectolitre of product produced. We have made some reduction gains from 2018 to 2019, reducing overall emissions by 11% or 1,032 tonnes of CO2e. This includes reducing refrigerant losses by more than 500 tonnes of CO2e by repairing a leaking refrigerant unit at our Waitemata Brewery. We have also achieved improvements in reducing thermal energy consumption at Waitemata and DB Draught breweries. Emissions due to electricity consumption have increased mainly due to three additional installation control points being identified during 2019 data gathering.

We continue to maintain a strong record on waste diversion, with our Waitemata and DB Draught sites officially at ‘zero waste to landfill’ status (98% or above).

2019 scope 1 and 2 emissions

	Progress	2030 target	2020 target	2019	2018
Total scope 1 & 2 CO2e (tonnes)	On track	4,554	8,410	8,149	9,181

Key measures	2020 target	2019	2018	2017	2016	2015
Thermal energy use (GJ)	n/a	72,974	74,416	70,088	71,164	74,076
Energy use (GJ)	n/a	124,294	119,136	113,305	108,274	100,043
Energy intensity (MJ / hl)	84.9	94.4	91.15	91.7	92.7	97.9
Thermal energy intensity (MJ / hl)	52.2	58.7	57.66	57	56.9	60.6
Electric energy intensity (kWh / hl)	9.1	9.9	9.62	9.7	9.9	10.4
Waste produced (tonnes)	n/a	14,521	16,296	15,066	16,166	15,841
Waste diversion rate	98%	96%	97%	97%	96%	95%

* Our energy and waste reporting data includes our three main production sites: Waitemata Brewery in Auckland, DB Draught Brewery in Timaru and Redwood Cidery in Nelson.

Looking ahead

2020 will see the business finalise preparations for switching to biomass at DB Draught Brewery, with implementation scheduled for 2021. The changeover will have a material impact on our greenhouse gas emissions. Our work towards setting scope 3 emissions targets and reduction roadmaps continues. We will also undertake our first climate change risk assessment to better understand the financial and physical impacts that climate change will have on our value chain and business continuity.