Science-Based Targets in the Information and Communication Industry 2021
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Science-Based Targets in the Information and Communication Industry 2021
1. Introduction
Increasingly more organizations are joining the The SBTi aims to mobilize the private sector to take
bandwagon of carbon neutral pledges, net-zero action on climate change along with governments
emission goals, and emission reduction targets. to make these targets the new normal. There are
While it is certainly great news to those who are currently over 1,000 companies from all over the
concerned about the fate of the planet under climate world in all types of sectors, ranging from aerospace
change, it is often hard to understand what these to food, that set an emissions target with SBTi.
commitments really mean and whether they are There are also sector specific guidance documents
Setting an emissions reduction
aligned with the mitigation targets set by scientists to assist companies in setting targets. goal with SBTi provides
and international communities.1 confidence that a company is
One of the sectors facing a challenge in setting taking meaningful action to
This is where the Science Based Target initiative meaningful yet practicable climate targets is the
reduce potential effects from
(SBTi) comes into play. “The SBTi is a partnership Information and Communication Technology (ICT)
between CDP, the United Nations Global Compact, sector. The sector witnessed remarkable growth climate change.
World Resources Institute (WRI) and the World over the past decades and is expected to continue
Wildlife Fund for Nature (WWF).”2 The SBTi works the expansion at a 5% compound annual growth
with companies to define emission targets rate in the coming years.4 During the COVID-19
consistent with climate science to “limit global pandemic, in particular, the world became even
warming to 1.5 degrees celsius to prevent the worst more reliant on services provided by the ICT
effects of climate change.”3 Setting an emissions sector. How is the global ICT industry positioning
reduction goal with SBTi provides confidence that themselves with the climate targets and pledges?
a company is taking meaningful action to reduce The objective of this article is to provide an overview
potential effects from climate change. of the SBTi and key actions taken by the global ICT 1000+ companies set an
industry.
emissions target with SBTi.
1 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY2. Overview of Science-Based
Targets in the ICT Sector
2.1 Putting the ICT Sector in
Context
The Information and Communication Technology Even with expected growth from the ICT sector,
(ICT) sector consists of telecommunication continued digitization is expected to disrupt the
equipment (including phones, tablets, routers, global economy and enable further emissions
modems, PCs), networks, data centers, and reductions through increased efficiencies.7 Thus, 730 Mt
operational activities. Use of telecommunication climate change provides the ICT sector with both CO2e
equipment has and continues to increase as seen risks and opportunities.
720 Mt
by data traffic increases and spending increases
on this technology. While total data traffic in the Risks to the ICT sector include impacts on CO2e 2015
ICT sector has grown exponentially, more than network reliability from extreme weather events
300% between 2010 and 2015, the ICT sector’s
carbon footprint has stayed relatively stable, only
and increasing costs to power ICT equipment.
Opportunities include increasing energy efficiency
2010
increasing from 720 million metric tonnes (Mt) CO2e of ICT networks and products, and dematerialization
to 730 Mt CO2e between 2010 and 2015.5 Energy in the transition from products to services.8 In The ICT sector’s carbon
efficiency improvements that have kept the carbon 2018 it was estimated that mobile communication
footprint of the ICT sector from increasing with use technology alone resulted in 2,135 Mt of avoided
footprint has stayed
will have to continue improving to meet carbon CO2e emissions.9 The ICT sector recognizes its relatively stable, despite the
emission targets as the ICT sector is expected to importance in fighting climate change and has total data traffic growing.
continue to grow by at least 5% annually from 2021 developed a Science-Based Target (SBT) pathway
to 2023.6 for the industry to meet the Paris Agreement goals
of limiting global warming to 1.5 degrees Celsius.10
SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY 2Figure 1. Global ICT Spending 2018-2023
The global ICT spending from 2018 through 2020 and projected spending through the year 2023.
Projections show constant growth through 2023. Traditional technologies refer to hardware, software,
services and telecom whereas new technologies refer to technologies such as robots/drones, AR/VR
headsets, or technologies that are newer and still developing.
Data accessed at: https://www.idc.com/promo/global-ict-spending/forecast.11
3 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY2.2 Science-Based Targets applied
to ICT sector
The new SBT guidance for the ICT industry All but one company set absolute targets for companies that set an SBT, their commitments to
was developed jointly by Global Enabling their scope 1 and 2 emissions, meaning they addressing scope 3 vary from committing to 50%
Sustainability Initiative (GeSI), International will reduce total GHG emissions, as opposed of suppliers by monetary spend having their own
Telecommunication Union (ITU), Global System to an intensity target, which requires reducing SBT, to reducing scope 3 emissions of their sold
for Mobile Communications (GSMA), and SBTi.12 GHG emissions per unit revenue generated. For products by 29%, or to reducing scope 3
In February 2020 there were 29 companies, companies that set absolute targets, the average emissions by 15% per customer. Since scope 3
comprising 30 percent of global mobile length of target is 11 years from their emissions emissions commitments and target types vary
connections, that had set or were committed to base year, with an average scope 1 reduction widely, even within sectors, comparing and setting
setting an SBT.13 As of the end of January 2021 goal of 52% and scope 2 reduction goal of 56%. a baseline for what scope 3 goals should be made
there were 23 ICT companies that had set an Given the anticipated growth of the ICT sector, is not always straightforward. With companies at
SBT and 16 committed to setting an SBT.14 In achieving the level of reduction in GHG emissions different stages of their carbon footprint analysis,
the United States, AT&T Inc., Verizon, T-Mobile set by these targets is a challenging task and scope 3 should not necessarily be used to compare
US, Inc., Applied Optoelectronics, Inc., and requires substantial investment. emissions goals between companies, rather used
CenturyLink, Inc. have either set or committed to as a baseline for companies to reconsider energy
setting an SBT. Figure 2 shows the distribution of Targets for scope 3 emissions get more efficiency plans.16
companies by region that have set an SBT. Table complicated, as scope 3 emissions are often the
1 shows the size of ICT companies by market biggest source of emissions and the degrees of
capitalization that have set an SBT. commitments and target types vary widely.15 For
Table 1. Market Capitalization of ICT Market Cap
0-50 50-100 100-150 150-200 200+
Companies with an SBT (Billion USD$)
The market capitalization of ICT companies Number of
18 1 1 1 1
that have set an SBT to show an overview of the Companies
company size. All numbers are in Billions USD
and are accurate as of February 12, 2021.
SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY 4Figure 2. Number of ICT Companies with an SBT by Region The number of ICT companies, by region, that have set an SBT. As of the end of January 2021, Europe is the region with the most ICT companies with an SBT totaling 13 companies. Data accessed at: https://sciencebasedtargets.org/companies- taking-action?sector=Telecommunication%20Services#table.17 Figure 3. SBTs of 2°C scenario (13%) Telecommunications Companies The distribution of SBT ambitions of the 23 telecommunications companies Well-below 2°C 1.5°C scenario that had set an SBT as of the end of scenario (21.7%) (65.2%) January 2021. Data accessed at: https://sciencebasedtargets.org/companies- taking-action?sector=Telecommunication%20Services#table.18 5 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY
3. Science-Based Targets in Practice
3.1 How to Set a Target
Criteria for setting a SBT include considering calculated based on an emissions reduction emissions. If required to set a scope 3 target, the
scope 1 and 2 emissions, and scope 3 emissions factor specific for a particular emissions reduction target should collectively cover at least two-
if scope 3 emissions account for over 40% of pathway and appropriate sub-sector.20 A company thirds of total scope 3 emissions, but there are
total emissions.19 If required to consider Scope 3 may opt to announce an intensity target, but it is various options in how to plan to achieve that
emissions, the target must cover at least two- worth noting that even intensity targets need to goal such as engaging with value chain partners
thirds of total scope 3 emissions. reduce absolute emissions, thus it is just a matter or only addressing certain emissions sources.22
of how a company wants to communicate their
At a very high level, ICT companies set a target for target.
scope 1 and 2 emissions by:
3.2 Mitigation Actions and
For scope 3 emissions there are no sector or
• Selecting a baseline year sub-sector specific considerations, a company Strategies: Examples
• Setting a target year can either set a reduction target, a supplier or
• Measuring scope 1 and 2 emissions customer engagement target, or a combination Once a company commits to an SBT it also needs
• Calculating the SBT of these options. For companies in the ICT sector, to take action. Telefónica is one of the world’s
they are most likely going to need to set a scope top 10 largest telecommunications companies
It is recommended that when selecting a baseline 3 target because their scope 3 emissions are with operations in 14 countries.23,24 Telefónica
year, use the most recent year for which data likely to be 40% or more of total scope 1, 2, and 3 committed to reducing scope 1 and 2 emissions
is available. When setting a target year it must emissions. Particularly within scope 3, their most by 50% by 2025 and 70% by 2030 from a 2015
cover at least 5 years, but it is not recommended significant emissions will probably come from base year. Telefónica also committed to reducing
that targets be set further out than 2030 due purchased goods and services, or use of sold absolute scope 3 emissions from fuel and energy
to the continued evolution of ICT technologies. products.21 related activities by 25% by 2025 from a 2016 base
Measuring of scope 1 and 2 emissions need to be year, and from purchased goods and services
measured for the baseline year following the GHG Although scope 3 emissions are generally the and capital goods by 30% by 2025 from a 2016
Protocol. Then to calculate a SBT, the scope 1 and most difficult to address, the SBTi provides more base year. This SBT was the second one set by
2 emissions from the base year need to be flexibility in how to set a target for scope 3 Telefónica after it had met its previous target early.
SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY 6The main way for Telefónica to achieve its new Telefónica also has a Renewable Energy Plan renewable energy in Europe and Brazil and
goals is through energy efficiency and renewable in which it focuses on three different actions 58% worldwide. Lastly, Telefónica’s EcoSmart
energy.25 Telefónica is already 100% powered by depending on the market of operation: Services tools provide the greatest potential
renewable energy in Europe and Brazil and 50% to reduce emissions as well.30 Telefónica has
worldwide. • Acquisition of renewable energy with a demonstrated that its strategy for climate change
guarantee of origin not only prepares them for risk but also results in
Through its Energy Efficiency Plan, Telefónica has • Long-term power purchase agreements (PPA) economic benefits.
modernized its network through 139 initiatives • Shorter duration and self-generation27
that have improved energy intensity by 64% in
2018 compared to 2015, even with data traffic 3.3 Key Actions for ICT Companies
increasing. Projects from their Energy Efficiency Telefónica has its greatest opportunity to reduce Towards a Science-Based Target
Plan include the following: greenhouse gas (GHG) emissions through its
EcoSmart services, which include managing Telefónica’s actions to set an SBT and meet its
• Lighting: Replacement of fluorescent lights energy meters and providing customers with goals through energy efficiency, renewable energy,
with LED technology and installation of real-time energy consumption to manage energy and digitization is a formula that is consistently
presence detecting sensors. usage. Through its EcoSmart services Telfónica used for telecommunications companies.
• Power Saving Features: Activation of energy- is increasing digitization and the use of fibre Other actions that are seen throughout
saving functions during periods of low traffic and 5G which allows for faster speeds and more telecommunications companies’ plans are
in base stations and centers. capacity while reducing energy consumption.28 reduction of e-waste, either through recycling
• Cooling: Technological update of the cooling Telefónica is also helping with digitization or reuse of their devices and equipment, and
devices and installation of free cooling through: procuring renewable energy. Figure 4 shows the
facilities. number of ICT companies with an SBT that are
• Power: Technological update for power units • Cloud service and virtualization targeting 100% electricity from renewable energy
and substitution of poor efficiency rectifiers. • Energy efficient buildings and the year in which they are planning to meet
• Transformation of the Network: Shut down of • Fleet management and mobility that target.
old equipment, network upgrades and local • Audio/video conferencing
optimization. • Telecommuting29 While there are several different approaches
• Renewable self-generation: Implementation to setting and achieving an SBT, within similar
of renewable systems for self-consumption A commitment to its climate strategy allows companies, such as those within the ICT
and reduction of fuel consumption. Telefónica to reduce its impact and increase sector, there are key actions that make sense
• Others: Configuration of network equipment digitalization, which serves as a way to reduce for almost all within the sector. As seen by the
to improve its efficiency.26 carbon of other sectors. Through its Energy number of companies that are taking actions
Efficiency Plan, Telefónica has saved 181 GWh involving renewable energy, energy efficiency,
of energy and over 73,145 tonnes of CO2e. Its and digitization, it is clear that to set emissions
Renewable Energy Plan resulted in 100% targets, the ICT sector has several proven
strategies to take climate action.
7 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRYFigure 4. ICT Companies with a SBT
Committed to 100% Renewable
Electricity Not Committed
Committed (52.2%)
The percentage of 23 ICT companies (of those with (47.8%)
an SBT) that set targets for 100% of electricity from
renewables.
10 Figure 5. ICT Companies
Year Commitment to 100%
Number of Companies
Renewable Electricity
5
Of the ICT companies with an SBT and
a 100% renewable electricity target, this
chart shows its target year.
0
Already Reached By 2021 By 2025 By 2030
Year to reach 100% renewable energy
SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY 84. Discussion and Conclusions
As the world continues to move towards because as mentioned above, there is more
digitization, the ICT sector continues to grow flexibility in scope 3 emissions targets. As not
and play an ever more important role in society’s all companies need to address the same portion
advancement. Even with the increased demand of their scope 3 emissions, with the requirement
for information and communication put on ICT being they address two-thirds of scope 3
providers, they can take actions to reduce their emissions, there are various ways of addressing
footprints. This comes in various forms of energy that. Common actions to address scope 3 energy efficiency
efficiency, renewable energy and optimization emissions include encouraging paperless
through automation. From innovative cooling customer communications, providing incentives
and lighting technologies at offices and data or assistance for employees to take public transit
centers to network upgrades, energy efficiency or carpool, allowing for work from home to reduce
is a key component of climate action for ICT commuting to the office, offering hardware
sector companies. Renewable energy also plays recycling options, and requiring suppliers
a critical role to meet the energy demands at data to address their emissions. Within scope 3
centers and offices. With increasing automation emissions, there are fewer consistent actions renewable energy fleet efficiency
in the ICT sector, optimization of vehicle fleet across all ICT companies relative to actions to
efficiency and shifting energy load are just address scope 1 and 2 emissions.
some of the ways the ICT sector is increasing Companies within the ICT sector
operational efficiency and decreasing emissions As with any problem as big as climate change, have an array of solutions that when
impacts. there is no single or simple solution, but implemented together will play
companies within the ICT sector have an array of
a significant role in avoiding the
Companies within the ICT sector address their solutions that when implemented together will
dangerous impacts of climate change.
scope 3 emissions with a wider range of actions play a significant role in avoiding the dangerous
impacts of climate change.
9 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRYEndnotes
1 According to the Intergovernmental Panel on Climate Change (IPCC), avoiding dangerous climate change requires capping the global mean temperature
rise to 1.5~2°C from the pre-industrial level, which is still achievable if global anthropogenic CO2 emissions reach net zero by 2040-2055. See: IPCC (2018): Spe-
cial Report: Global Warming of 1.5 ºC. https://www.ipcc.ch/sr15/chapter/spm/. The Paris Climate Accord (in short, ‘Paris Agreement’) aims to meet this target,
while current pledges and emission trajectories by its signatories are falling short.
2 Science Based Targets. “About Us.” Accessed March 7, 2021. https://sciencebasedtargets.org/about-us.
3 Ibid.
4 “Global ICT Spending - Forecast 2020 – 2023.” IDC. Accessed February 25, 2021. https://www.idc.com/promo/global-ict-spending/forecast.
5 Malmodin, Jens, and Dag Lundén. “The Energy and Carbon Footprint of the Global ICT and E&M Sectors 2010 - 2015.” Sustainability 10, no. 9 (August 25,
2018). https://doi.org/10.3390/su10093027.
6 “Global ICT Spending - Forecast 2020 – 2023.” IDC. Accessed February 25, 2021. https://www.idc.com/promo/global-ict-spending/forecast.
7 J. Falk, O. Gaffney, A. K. Bhowmik, P. Bergmark, V. Galaz, N. Gaskell, S. Henningsson, M. Höjer, L. Jacobson, K. Jónás, T. Kåberger, D. Klingenfeld, J. Len-
hart, B. Loken, D. Lundén, J. Malmodin, T. Malmqvist, V. Olausson, I. Otto, A. Pearce, E. Pihl, T. Shalit. “Exponential Roadmap 1.5.1.” Future Earth. Sweden. (Janu-
ary 2020).
8 “The Contribution the ICT industry can make to sustainable development. A materiality assessment.” Global e-Sustainability Initiative. (April 2008).
9 “The Enablement Effect.” GSMA & Carbon Trust. Accessed January 31, 2021. https://www.gsma.com/betterfuture/wp-content/uploads/2019/12/GSMA_
Enablement_Effect.pdf.
10 “Telecoms Sector Agrees Pathway to Net Zero Emissions.” United Nations Framework Convention on Climate Change. (February 28 2020). https://unfc-
cc.int/news/telecoms-sector-agrees-pathway-to-net-zero-emissions.
11 Ibid.
12 “Guidance for ICT Companies Setting Science Based Targets.” ITU, GeSI, GSMA, SBTi. Accessed January 31, 2021. https://sciencebasedtargets.org/re-
sources/legacy/2020/04/GSMA_IP_SBT-report_WEB-SINGLE.pdf.
13 “Telecoms Sector Agrees Pathway to Net Zero Emissions.” United Nations Framework Convention on Climate Change. (February 28 2020). https://unfc-
cc.int/news/telecoms-sector-agrees-pathway-to-net-zero-emissions.
14 Science Based Targets. “Companies Taking Action.” Accessed January 31, 2021. https://sciencebasedtargets.org/companies-taking-action?sec-
tor=Telecommunication%20Services#table.
15 H.S. Matthews, C.T. Hendrickson, C.L. Weber. “The importance of carbon footprint estimation boundaries.” Environ Sci Technol, 42 (2008), pp. 5839-5842
16 Gregor Radonjič, Saša Tompa. “Carbon Footprint Calculation in Telecommunications Companies – The Importance and Relevance of Scope 3 Green-
house Gases Emissions.” Renewable and Sustainable Energy Reviews 98 (December 1, 2018): 361–375. https://doi.org/10.1016/j.rser.2018.09.018.
17 Ibid.
18 Ibid.
19 “Guidance for ICT Companies Setting Science Based Targets.” ITU, GeSI, GSMA, SBTi. Accessed January 31, 2021. https://sciencebasedtargets.org/re-
sources/legacy/2020/04/GSMA_IP_SBT-report_WEB-SINGLE.pdf.
20 Ibid.
21 Ibid.
22 Science Based Targets. “Science-Based Target Setting Manual.” Science Based Targets. Version 4.1. April 2020.
23 Dutta, S. “11 Biggest Telecom Companies in the World.” Yahoo Finance. (October 30,
SCIENCE-BASED
SCIENCE-BASED 2020). https://finance.yahoo.com/news/11-biggest-telecom-com-
TARGETS
TARGETS ININTHE
THEINFORMATION
INFORMATIONAND
ANDCOMMUNICATION
COMMUNICATIONINDUSTRY
INDUSTRY 10
9
panies-world-162958967.html.
24 Telefónica. “Company Profile.” Accessed on February 7, 2021. https://www.telefonica.com/documents/153952/145906467/Telefonica-Corporate-Pro-20 Ibid. 21 Ibid. 22 Science Based Targets. “Science-Based Target Setting Manual.” Science Based Targets. Version 4.1. April 2020. 23 Dutta, S. “11 Biggest Telecom Companies in the World.” Yahoo Finance. (October 30, 2020). https://finance.yahoo.com/news/11-biggest-telecom-com- panies-world-162958967.html. 24 Telefónica. “Company Profile.” Accessed on February 7, 2021. https://www.telefonica.com/documents/153952/145906467/Telefonica-Corporate-Pro- file.pdf/260ed500-7156-daa6-d442-dca059893025. 25 Ormazabal, M. “Telefónica Energy and Climate change strategy.” GSMA. February 5, 2020. https://www.gsma.com/futurenetworks/wiki/telefonicas-en- ergy-and-climate-change-strategy/. 26 Telefonica. “Energy and Climate Change.” Accessed February 24, 2021. https://www.telefonica.com/en/web/responsible-business/environment/ener- gy-and-climate-change-2. 27 Ibid. 28 Ormazabal, M. “Telefónica Energy and Climate change strategy.” GSMA. February 5, 2020. https://www.gsma.com/futurenetworks/wiki/telefonicas-en- ergy-and-climate-change-strategy/. 29 Ibid. 30 Ibid. 11 SCIENCE-BASED TARGETS IN THE INFORMATION AND COMMUNICATION INDUSTRY
You can also read
