We share society’s concerns about the impacts of climate change on our environment. As a result, we are focused on developing real solutions, bringing the breadth of our innovation, problem solving abilities, and proven gases and technology capabilities to bear on climate change.
Our Greenhouse Gas strategy is focused on leveraging the business growth opportunities of climate change while managing its potential risks. In this capacity, we are identifying opportunities to use our core technology and product strengths to bring cost-effective solutions to our customers, and helping to reduce their environmental impact while improving our facilities to reduce emissions and costs.
We demonstrate this commitment through continually working to improve our own productivity and reduce our impact on the environment, and we have established four environmental sustainability goals for 2020, each of which uses operating performance from 2015 as a baseline year:
- Save energy by reducing use intensity by 2.5% for ASUs, and 1.5% for HyCOs
- Reduce GHG emissions intensity by 2%
- Conserve water and lower use intensity by 5%
- Improve efficiency and reduce CO2 emissions related to distribution by 10%
Established in 2016, these goals were selected based on environmental parameters considered the most significant for Air Products.
Understanding Our Footprint
Management of climate change represents a significant potential for business growth. Air Products is also focused on managing its climate risks.
As a solution provider, our strategy for responding to climate change is straightforward—identify opportunities where our core technology and product strengths bring cost-effective solutions that enable our customers to reduce their overall supply-chain environmental impact, while using innovation and efficiency improvements to reduce GHG emissions and the potential cost impacts of a carbon-constrained energy supply on our operations. This approach is reflected in our Climate Change Policy Statement.
Climate Change Policy Statement
Climate change, energy consumption and water use are inextricably linked. Looking ahead, the world’s population is expected to grow to over nine billion people by 2050, while their needs for energy, water and food will increase even faster. For these reasons, maximizing the efficient use of the earth’s resources while minimizing environmental impacts is vital.
Air Products’ long-standing strategy for responding to these challenges is straight forward. We enable our customers to reduce their environmental impact by providing cost-effective technologies and products that improve their energy and water efficiency and reduce emissions to the environment. At the same time, we strive to reduce energy and water consumption, as well as emissions, in our own operations through efficiency improvements and technological innovations. We are making real progress in these areas, as demonstrated by our environmental sustainability targets and related cost savings.
Due to changes in our approach to GHG reporting in 2018, Air Products has restated its GHG emissions for the past two years. Under these revised guidelines, which are more in line with industry peers’ reporting, we have reduced our GHG emissions intensity by 1.4% since 2015 and are on track to meet our 2020 goal.
WSP Environment & Energy (WSP) conducted a limited assurance review of our 2016 Scope 1, Scope 2 and Scope 3 greenhouse gas inventory in accordance with ISO 14064-3. WSP issued an Assurance Statement, attesting to Air Products’ adherence to the Greenhouse Gas Protocol and the absence of any material inaccuracy in the representation of the inventory data.
We have also completed an assessment of our Scope 3 reporting, and are no longer reporting on several categories due to concerns about data quality and alignment with industrial gas peers. Under this new approach, our Scope 3 emissions, which include fuel and energy related activities, business travel, and investments, were 4.9 million metric tonnes for 2017.
Energy Conservation and Efficiency
Energy consumption is an important variable cost of our production processes, and we carefully track and manage energy purchases. Our conservation programs are focused on continually improving energy efficiency across all our plants, and in particular, our larger facilities that consume the most energy.
Our energy consumption in 2017 was 54.6 million MWh, representing a 6% increase from 2016. The increase was a result of our growth which was driven by rising customer demands. Due to changes in our approach to energy reporting in 2018, Air Products is reporting on purchased energy for 2017 and has restated consumption for 2015 and 2016.
Of our electricity purchases in 2017, 22% was from renewable sources. This is an increase of 16% from 2016 due to our higher use of renewable energy in France and the UK, as well as increasing the amount of renewable energy we use that is available on the grids in certain regions where we operate.
In 2017, our ASUs realized a 1.6% reduction in energy intensity from a baseline year of 2015. Our HyCO units improved energy efficiency by 0.6%. These successes were realized through the commissioning of new, larger and more efficient facilities, as well as hundreds of facility improvement projects involving changes to equipment and manufacturing processes.
As world populations grow, water scarcity is becoming increasingly real. Experts project there will be a 40% shortfall between water demand and fresh water supply by 2030, and by 2050, nearly three billion people will live in water-stressed areas. Water conservation is critical to the health and sustainability of our planet.
Water is vital to Air Products – we cannot operate our facilities without water supplies that are sufficient in quantity and quality. As a result, we strive to be good stewards of water by reducing our water consumption intensity and implementing projects to recycle water and improve water quality.
We use water primarily for cooling, to make hydrogen using the SMR process, and to provide steam and water to our customers. The steam is a co-product of our SMRs, and has a significant efficiency advantage when compared to steam generated from boilers. Because of these uses, our water consumption is tied closely to energy use; therefore, improvements in energy efficiency can also conserve water. Furthermore, we use water for safety systems (i.e., fire suppression) and cleaning.
Air Products has established a goal to reduce water consumption by 5% on an indexed basis by 2020 from a 2015 baseline. In 2017, we made good progress against this goal, realizing a 9% decrease and achieving our goal.
Our consumption of water, on an absolute basis, increased to 15.6 million gallons in 2017 due to increased manufacturing production required to meet our customers’ needs. Consumption on an intensity, or per volume of product basis decreased, as our energy efficiency and water intensity improved. That means the volume of water we consumed was not commensurate with the growth of our operations.