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Carlsberg aims to be greenest brewery in the world

Data is all important in the company’s energy transition

The world’s third largest brewery, Carlsberg is a heavyweight when it comes to zero-carbon ambitions, but turning theory into practice is challenging. So, too, is accelerating decarbonisation of the entire value chain and boosting investments in renewables

GOING GREEN
A marketing slogan from Danish company Carlsberg laid claim to making “Probably the best lager in the world”. The brewery now wants to become the best beer for the world by reducing its carbon footprint to zero by 2030

REALISM
Eliminating emissions from its supply chain is the biggest challenge, says Carlsberg, requiring a step-by-step approach that rules out rapid change, it claims. Better data and stricter procurement rules are vital

KEY QUOTE
“We have the plan, but we need to invest more in energy efficiency and energy sourcing at our breweries and scale up efforts to reduce the carbon footprint of our entire supply chain.”

The best beer for the world. This is the mission of Danish company Carlsberg, one of the world’s oldest breweries. The company has reduced carbon emissions by 20% since 2015 and has announced plans to slash its carbon footprint to zero by 2030. In 2018, nearly half of its electricity came from renewable sources and the company plans to run all its breweries on only renewable electricity and to have totally phased out coal by 2022. Despite these advances, there is still a long way to go. “We have the plan, but we need to invest more in energy efficiency and energy sourcing at our breweries and scale up efforts to reduce the carbon footprint of our entire supply chain,” says Simon Boas Hoffmeyer, Carlsberg’s director of sustainability. With an annual net revenue of €62.5 billion and a carbon footprint of 704,000 tonnes in 2018, Carlsberg has set an ambitious goal, not least because the vast majority of its emissions (86%) are released outside its breweries in agriculture, cooling and transport. The company is insistent it wants to tackle emissions from the full life-cycle of its products and reduce “beer-in-hand” emissions by 30% by 2030. Carlsberg aims to have 30 strategic partnerships with companies in its supply chain by 2022 all aimed at removing CO2 from beer production. The brewery already chooses its partners based on their sustainability programmes and will increasingly only work with suppliers that have “active and ambitious” carbon agendas, says Carlsberg’s Philip Hodges. He says the company is looking at incorporating key performance indicators on emissions in its tender process.

RISING DEMAND Pressure to change is also coming from consumers. Sales of “sustainable” beverages in the EU have jumped by 93% in the past five years and a further 90% increase is expected over the next five years, says a recent report from the International Trade Centre, a joint agency of the World Trade Organization, the UN, and the European Commission. A study from 2018 by scientists at Indiana university reveals US consumers are willing to pay round $1.30 more per six-pack for sustainable beer. Carlsberg is well aware of the potential business opportunities of going green. “For us it is a matter of future growth,” says Boas Hoffmeyer. For a global corporation employing more than 40,000 people, with production sites in 35 countries and products available in over 150 global markets, data is all important in its energy transition. Back in 2015, when Carlsberg group management decided to ramp up its carbon reduction efforts, the first step was to conduct an end-to-end measurement of the firm’s carbon footprint. The analysis, by the UK Carbon Trust, took almost two years and was used as the baseline for setting emissions reduction targets for 2022, 2030 and 2050. The company now produces annual carbon progress reports and a value chain carbon footprint analysis every third year, but claims it is not an easy undertaking. “The data we have for our carbon footprint in our own breweries is good, but measuring our supply chain’s footprint is much more difficult,” says Boas Hoffmeyer. “It is almost impossible for us to measure the exact share of renewable energy or energy efficiency progress throughout the entire value chain.” Carlsberg conducts detailed data analysis on its biggest suppliers, but relies on secondary data from external companies, public institutions and other actors to understand progress on decarbonisation by other sectors. “It would be impossible to cover all our suppliers and we have no intention to do this,” says Hodges. “We cover the major ones like malt, glass, aluminium cans, PET, paper and board, transportation and distribution, and coolers and fridges.” Carlsberg is looking at developing better methodologies with The Carbon Trust and the Science Based Targets initiative, a consortium consisting of not-for-profit organisations (CDP, World Resources Institute and WWF) together with the UN Global Compact.

FROM GLOBAL STRATEGY TO LOCAL ACTION In-house, Carlsberg has introduced a global best practice energy efficiency programme focusing on optimising production processes and upgrading equipment. The company is also working on a country-by-country basis on energy sourcing. “We are making good progress by taking it step-by-step and adjusting our efforts to local cultures and legislation,” says Hodges. In China, the big issue for Carlsberg is to phase out its heavy reliance on coal and it has decided to invest instead in natural gas. “This is not the ideal solution, but it is the best we can do right now and a step in the right direction,” says Boas Hoffmeyer. Hodges does not believe an immediate switch to carbon neutrality is possible. “We need to ease our way together with the regulatory authorities,” he insists, though adds that all the company’s electricity will be sourced from renewables by 2022, including in China. All Carlsberg’s 29 breweries in Western Europe are already 100% powered by renewable electricity sourced from a mixture of onsite solar arrays and through power certificates with guarantees of origin. In Sweden, Carlsberg’s brewery is powered by renewable electricity and biomethane, which is partly sourced through certificates and partly through biogas generated from the breweries own wastewater. At a Serbian brewery, Carlsberg, at a cost of €1 million, has installed a new biomass boiler fuelled by wood pellets made from the factory’s waste pallets, reducing carbon emissions by 22%.

MASSIVE INVESTMENT NEEDED Hodges will not detail how much the necessary changes will cost globally, preferring to highlight the company’s focus on new technologies and smart investments. He adds: “In general, we believe sustainable business is good business.” Carlsberg should massively scale up investments in additional renewable energy if it is to have a hope of meetings its decarbonisation goals, says Emil Skals, director at The Footprint Firm, a Danish advisory and investment company. “Like most other companies, Carlsberg reduces a part of its carbon emissions from energy use through buying renewable energy certificates. Research questions whether or not this really adds more renewable energy to the grid.”

TEXT Anna Fenger