We pioneer solutions for customers to enable decarbonization in an intelligent, cost-optimal manner and ensure carbon neutrality in our own operations.
We have committed to ambitious targets covering our operations, suppliers, and customers with a focus on reducing value chain emissions, including "purchased goods and services" and "use of sold products."
Our decarbonization targets:
Decarbonization based on science
We want to become the preferred partner in helping our customers decarbonize, and we’ve built a strong foundation for achieving our own targets.
In January 2020, we took a significant step toward contributing to the goals of the Paris Agreement by committing to set science-based target. Our emission reduction targets have been validated and approved by the Science Based Targets initiative in May 2022.
Danfoss commits to reduce 46.2 % of absolute scope 1 and 2 GHG emissions by 2030 from a 2019 base year. Danfoss also commits to reduce absolute scope 3 GHG emissions by 15% within the same timeframe.
We furthermore commit to reduce our scope 1 and 2 GHG emissions to zero by 2030 through energy efficiency measures, re-use of excess heat from processes and buildings, sourcing of renewable energy and only use offsetting as a last resort.
We commit to reduce scope 3 GHG emissions from purchased goods and services by 25% by 2030 from a 2019 base year.
We apply a three-step approach to decarbonize our global operations.
- Step 1: Reduce involves saving energy by installing energy-efficient solutions such as heat pumps where possible.
- Step 2: Re-use entails recycling the energy we already have by using excess heat from buildings, processes, and data centers.
- Step 3: Re-source involves turning the remaining energy green by phasing out fossil fuels and procuring renewable energy.
As a last resort, we consider climate compensation for the residual emissions that cannot be removed in any other way. We continue to prioritize energy efficiency in buildings and processes to reach our goal. We are ambitious in the use of our solutions to achieve a large part of the energy savings and have proven that applying energy-efficiency measures is good business.
With more than 80% of energy-related emissions coming from electricity, decreasing energy consumption from electricity use is a key priority.
We are committed to purchasing 100% renewable electricity by 2030. We prioritize Power Purchase Agreements (PPAs) that contribute to the transition to more sustainable electricity grids and reinforce our long-term commitment to renewable energy. By purchasing green electricity where available, we can make the fastest and most significant contribution to climate action.
Since 2021, Danfoss uses carbon-neutral electricity in all our locations in Denmark and Germany through a Power Purchase Agreement (PPA). The agreement delivers 14% of the group’s total electricity consumption and is an important step towards carbon neutrality by 2030. Further PPAs are in the pipeline, and we expect to reach 50% green electricity by 2025.
For several years, Danfoss has systematically worked to reduce and recycle energy at the head office in Nordborg, Denmark. Now the 250,000 square meters are CO2 neutral. The goal has been achieved through a method that will also be used to lower emissions in Danfoss' other buildings and production sites around the world.
The first two steps are to reduce the energy consumption and then re-use or recycle as much energy as possible. The third step is to ensure that the site is supplied with green and renewable energy. Thus, Danfoss' electricity comes from offshore wind turbines at Horns Rev II via a so-called Power Purchase Agreement (PPA).
As a last resort, climate compensation is done for the last emissions that cannot be removed in any other way. The residual emissions that may remain after reductions and conversion to green forms of energy are compensated by carbon offsetting and removals through Climate Vault.
The electrification of our company car fleet is an important part of our goal to become carbon-neutral by 2030. In 2020, Danfoss joined EV100, an initiative under The Climate Group to support the global transition to electric vehicles by transforming our car fleet to all-electric by 2030.
In 2022, we increased capacity of on-site charging stations by 50%, and the expansion of charging infrastructure will continue in the coming years to offer employees and customers charging points for their electric vehicles. We have established charging infrastructure at 25% of our locations and expect to replace more than 300 electric vehicles of 2,000 cars in our company car fleet with electric vehicles in 2023.
Science Based Targets initiative
Our science-based target expands our greenhouse gas emissions reduction goals beyond our own business, across the entire value chain.
We joined the Climate Group business initiatives
In 2020, Danfoss joined, as the first global technology company, all three business initiatives by The Climate Group to send a strong signal to our business partners that we deliver on our climate ambition.
The Climate Group is an international non-profit organization working towards a world with net-zero emissions by 2050.
They build networks of governments and businesses that can commit to three sustainability pledges on sourcing 100% renewable energy (RE100), improving energy productivity (EP100) and shifting their fleets to electric vehicles by 2030 (EV100).
Annual report 2022
Our integrated annual report gives our stakeholders a holistic view of Danfoss’ business, value drivers, strategy, governance, and performance. It combines key information on our financial, sustainability and ESG-related performance.