Ø Danfoss commits to at least 10% (by volume) of all
primary aluminum procured annually to be low carbon by 2030.
Ø
The coalition is led by
World Economic Forum and the United States (US) Department of State, comprising
of 82 members, all global players in their markets.
Ø The aluminum industry generates more than 1.1 billion tons of CO2e (carbon dioxide equivalent) emissions annually – around 2% of global emissions.[i]
The World Economic
Forum has announced that Danfoss has joined the First Movers Coalition (FMC), a
global coalition to decarbonize hard-to-abate industries. Danfoss joins the FMC
aluminum sector, committing that at least 10% (by volume) of all the company’s
primary aluminum procured per year will be low carbon by 2030. Additionally,
Danfoss commits to ensuring that at least 50% of all aluminum used annually is
composed of secondary aluminum by 2030.
As a member of the
FMC, Danfoss joins a group of industry players harnessing purchasing power to
create a market for low-carbon aluminum, sending a strong market demand signal
for the emerging technologies essential for a net-zero transition. This
commitment by members focuses on creating a sustainable value chain for
aluminum and achieving a 50% reduction in CO2 emissions from primary aluminum
production by 2050. Danfoss has already entered into negotiations and begun
contractual agreements with suppliers for low-carbon aluminum.
Ravichandran
Purushothaman, President, Danfoss India Region says: “As a sustainable
organization serving the world’s energy efficiency needs for 9 decades now,
joining FMC is a testimony of Danfoss’ strong commitment towards
decarbonization and sustainability at the global level. This development could
be an inspiration for Indian manufacturing sector, industry bodies and the
govt., for a consortium on this line that will drive the economy of scale for
procurement and localization of netzero solutions and make them affordable as well
as accessible across value chains. The initiatives like FMC will accelerate
India’s net-zero transformation for a greener and sustainable tomorrow.”
Led by the World
Economic Forum and the US Government, the FMC targets hard-to-abate sectors
including aluminum, aviation, chemicals, concrete, shipping, steel, and
trucking, which are responsible for 30% of global emissions. For these sectors
to decarbonize at the speed needed to keep the planet on a 1.5-degree pathway,
they require low-carbon technologies that are not yet competitive with current
carbon-intensive solutions.
Jürgen Fischer,
President, Danfoss Climate Solutions, says: “Our customers are increasingly
demanding products with a lower carbon footprint – and they’re right to do so.
By joining the First Movers Coalition we are responding to this demand by
fostering the critical development of low-carbon aluminum production, and
thereby accelerating its entry to market. Being part of the coalition also
aligns with our own commitment as a leader in the green transition, to achieve
carbon neutrality across Danfoss’ global operations by 2030 and to reduce our
value chain emissions by 15% by 2030.”
FMC member companies
commit to purchasing a percentage of near-zero or
zero-carbon solutions from suppliers, which may come at a premium cost. If
a critical mass of global companies commits a certain percentage of their
future purchasing to clean technologies in this decade, this will create a
market tipping point that will accelerate their
affordability and drive long-term, net-zero transformation across industrial
value chains. The FMC is currently composed of 82 members, all global
players in their markets.
Rob van Riet,
Interim Head, First Movers Coalition, said: “We are thrilled to welcome Danfoss to
the First Movers Coalition, and are eager to work together towards the scaling
up of the low-carbon aluminum market globally. Our joint focus will be on
surfacing solutions to decarbonize aluminum and accelerate their deployment
with committed organizations like Danfoss, aiming to bring these solutions to
commercial scale.”
The aluminum
industry generates approximately 2% of global emissions[ii],
but it also has the strongest potential to become carbon negative by 2050.
Switching to low-carbon electricity is the biggest step the industry can take
to deliver a sector compatible with net zero targets.[iii]
Danfoss has
committed to achieve CO2 neutrality in its global operations (Scope 1 & 2)
by 2030 – supporting the business ambition to limit global warming to 1.5°C, which
has been validated by the Science Based Targets initiative (SBTi), and includes
a reduction in value chain emissions (Scope 3) by 15% by 2030. In addition,
Danfoss has a dedicated target of reaching 25% emissions reduction from its
suppliers by 2030 compared to the 2019 baseline. This commitment is included in
the targets of Danfoss’ three step-change initiatives on Decarbonization,
Circularity, and Diversity, Equity & Inclusion.
Already Danfoss has
seen progress in decoupling environmental impact from business growth by
delivering a 7% decrease in Scope 1 and 2 emissions while growing 15%
organically in 2022.
Read
more about Danfoss’s ESG ambition here: Environmental,
social, and governance (ESG) | Danfoss
More information about the First Movers Coalition can be found here: First Movers Coalition
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