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ZERO Carbon Footprint

The effects of climate change are taking place in every part of the world, affecting the environment, people and economy. Global warming, which is caused by heat-trapping greenhouse gases (GHG) due to human activities, impacts economic growth through extreme weather events such as frequent and intense droughts, storms and rising sea levels.

Carlsberg Group is committed to contributing towards the Paris Agreement goal to limit global warming to 1.5°C by setting ambitious global targets that have been approved by the Science Based Targets initiative (SBTi). Carlsberg Group is set to achieve ZERO carbon brewing by 2030 and is making progress globally against its 2022 targets to cut carbon emissions by half, to use renewable energy and to eliminate the use of coal. Removing carbon from the source of the production of beer will cut beer-in-hand emissions, which is the value chain footprint from raw material to the end-product that consumers enjoy, as much as 30% by 2030.

At Carlsberg Malaysia, we are committed to playing our part as a responsible corporate citizen to reduce our carbon footprint and contribute to a low-carbon future. We are committed to annual targets based on Carlsberg Group’s ultimate ambition of ZERO carbon emissions at our brewery and the 2022 global targets. Our Supply Chain Director, Management Team and functional heads are responsible for the implementation of our carbon emissions reduction road map. We are also guided by Carlsberg Group’s Environmental Policy and Carlsberg Group’s participation in the Task Force for Climate-related Financial Disclosures (TCFD) as well as the Intergovernmental Panel on Climate Change (IPCC).

Targets

We aim to achieve total energy usage of 28.6 kilowatt hours of per hectolitre (kWh/hl) and carbon emissions of 9.5 kg CO2/hl by 2022.

In line with our capabilities on carbon emission reductions, Carlsberg Malaysia Group targets a 5% reduction in thermal and electricity usage year-on-year.

By 2022, we aim to reduce our carbon emissions to 9.5 kg CO2/hl and we are on track to achieve a 15% reduction in beer-in-hand carbon footprint by 2022 with a target of 2% year-on-year.

Progress to completely replace R22 – a high-climate-impact refrigerant gas – by the year 2022 was stalled in the 2020 pandemic year. Replacement in stages has been prioritised with a dedicated budget from 2021 to facilitate complete replacement by 2023.

BEER-IN-HAND CARBON EMISSIONS

The Carlsberg Group conducted a study on beer-in-hand emissions and released market specific findings for ZERO Carbon Footprint in 2020.

The findings in 2019 against the baseline of 2015 showed that Malaysia’s beer-in-hand carbon footprint was higher compared to Carlsberg Group’s beer-in-hand emissions.

However, the reduction, compared to 2015, was 8.3%, an improvement of 1.3% over Carlsberg Group’s average, albeit from a higher base. The beer-in-hand studies that we conduct are market-specific and are performed periodically. No beer-in-hand studies were conducted in Malaysia in 2021.

Our focus remains on energy efficiency in brewing (14%), an area we directly control and maintain within our ISO 14001:2015 certification.

To this end, we commit to ongoing equipment optimisation, product innovation, research and development (R&D) and increasing operational and production efficiencies within our capacity.

Beyond our own operations, we continue to work with partners who supply our ingredients, packaging, logistics and refrigeration, actively seeking lower carbon alternatives where feasible and in line with business sustainability.

We continue to study measures to reduce carbon footprint impact, such as increasing recycled content in cans and shrink wrap,  optimising packaging mix, and material sourcing.

These measures add to our previous innovations such as wax emulsion coating on returnable glass bottles to extend their lifespans and “light-weighting” recyclable aluminium cans with thinner-gauge walls since 2016, utilising less raw material while maintaining structural integrity.

Other measures we continue to explore:

• Agriculture & processing: sourcing raw brewing material with a lower carbon intensity
• Transportation & cooling: increased sea transport and optimised routes-to-market
• Cooling: investment in energy-efficient
refrigeration in transportation and point-of-sales and the complete phasing-out of R22 refrigerant

AIR QUALITY & GREENHOUSE GAS (GHG) EMISSIONS

Guided by Carlsberg Group’s global goals, we have set out our own climate targets to reduce carbon emissions.

However, due to disruptions caused by the COVID-19 pandemic, we revised our 2022 targets slightly to account for factors such as uncertainty surrounding production planning, volatile operational environment and costs and a changing production mix.

By 2022, we aim to:
• Achieve total energy usage of 28.6 kilowatt hours per hectolitre (kWh/hl).
• Reduce carbon emissions to 3.4 kg CO2/hl.
• Achieve 5% reduction in thermal and electricity usage year-on-year.
• Achieve 15% reduction in beer-in-hand carbon footprint, with a target of 2% year-on-year versus the 2015 restated benchmark.

The reduction of carbon emissions to 3.4 kg CO2/hl can be achieved by reducing thermal and electricity usage by 5%, while sourcing for renewable energy sources.

We are disclosing our carbon emissions according to Scope 1 and Scope 2 to enable us to better track our carbon emissions towards achieving our climate targets.

ENERGY MANAGEMENT

Our efficiencies were affected by the 2.5-month suspension of operations at the brewery due to the lockdown.

However, our energy consumption remained the same despite no output during this period, resulting in the same amount of carbon emitted as the previous year.

This was due to the fact that we needed to keep our raw ingredients in storage cool, as well as ensure that semi-finished goods in tanks were always kept in optimal condition.

Our electricity usage increased slightly in 2021, mainly due to the lockdown periods. Although there was no production activity, our base electricity consumption remained unchanged as the energy centre, mainly the Cooling Plant and Compressed Air system, was still in operation to keep fermenter and beer storage temperature low.

However, we continued with our initiatives such as the cold insulation project and the replacement of condenser coils and optimisation of condenser discharge pressure for the cooling plant.

WASTE MANAGEMENT

A large portion of our production waste comprises spent grains, kieselguhr and waste yeast. We continuously reduce our production waste, with 746 tonnes sent to the landfill in 2021. This was a significant drop from 4,897 tonnes in 2019 and 1,327 tonnes in 2020.

In 2021, we sent 12,644 tonnes of spent grains to three contractors, compared to 18,787 tonnes and 15,191 tonnes in 2019 and 2020 respectively. Two of contractors use the spent grains as cattle feed while another applies a bioconversion process that transforms the spent materials into a protein component for livestock feed.

Besides spent grains, this bioconversion process also utilises kieselguhr and waste yeast from our operations to cultivate black soldier flies. The larvae of black soldier flies are then processed into two main ingredients, insect meal and insect oil, which are a source of protein for animal feed. These insect proteins can be used to feed pets and farm animals, in particular fish, poultry and swine, and also as a substitute for fish meal.

PRODUCT DESIGN & LIFE CYCLE MANAGEMENT

The iconic Carlsberg glass bottles are not only designed to provide consumers with a better beer experience but also to minimise environmental impact. First introduced in 2019, Carlsberg Malaysia was the first Carlsberg market in the world to pioneer the use of a new wax emulsion coating on its refillable glass bottles that helps to double its lifespan. The coating reduces scuffing, which extends the bottles’ longevity, allowing them to look new and scratch-free for longer and reducing the need for bottles to be taken out of circulation for recycling. Carlsberg is going greener by switching to Cradle to Cradle Certified™ silver ink on its bottle labels, which is produced using renewable energy. The ink helps improve the recyclability of packaging.