Minimising Environmental Harm

Carbon

Objective
We aim to reduce our emissions by the year 2020 via our Carbon Reduction Strategy. We have set individual reduction targets for our Divisions.
Progress
We are still on a working journey to reduce our emissions. Our carbon emissions have increased by 2.6% from the previous year, mainly due to organic growth. Following the disposal of our Power Business in our Energy &Utilities Division in FY2015, our Plantation Division now contributes 92.3% of total group emissions in 2014 as compared to 64.3% in 2013 (the Power Business contributed 29.7% of overall Group’s emissions in the previous year).

Methane emissions from the treatment of palm oil mill effluent (POME) is the largest contributor to the Group’s total operational emissions. We have started a biomass project to promote the usage of green and renewable energy across our Plantation operations. More than 85 per cent of the energy used is from the combustion of oil palm waste.

We have also initiated operational excellence initiatives to reduce our emissions. At our Nuri Edible Oil refinery, we have replaced Light Fuel Oil (LFO) with natural gas which resulted in a 65% reduction in operation cost and an estimated 25% reduction in carbon emissions. Through Lean Six Sigma tools, our subsidiary, SD Morakot, successfully increased the Refined Palm Olein yield to 67.9%, leading to a verified cost savings of RM1.64 million and reduced the carbon emissions for Refined Palm Olein down to 1.16 kg CO2e/ litre, the second lowest in Thailand.

Our carbon emissions calculation currently do not include emissions from land use conversion and carbon sequestration from growth of oil palm trees. The methodology around this area is still under evaluation as it is regarded as highly controversial. However, once they are included, the total emissions of the Group may differ significantly and will require a restatement of the carbon baseline. Sime Darby plans to include the calculations in its public reporting once evaluations on the appropriate methodology to be adopted has been finalised.

For more information on our carbon emission data, please visit our performance highlights page.
Approach
Since 2009, we have been monitoring our carbon emissions through a Group wide Sustainability Management System (SMS). The system helps in the preparation of our annual Carbon Inventory Report, enabling us to understand our emission trends and recognise the potential areas for reduction and improvements. Having identified that 92.8% of our total carbon emissions were from our Plantation Division, we have made it our priority to reduce our Plantation operations emissions by 40% by the year 2020, from 2009 baseline levels.

We are committed to the International Sustainability & Carbon Certification (ISCC), a leading certification system for sustainability and greenhouse gas emissions. It is recognised by the German government and the European Commission as a compliance mechanism for EU Renewable Energy Directive (RED) requirements for biofuels. As of now, all our Plantation operating units in Sabah and Sarawak are ISCC certified.

In 2014, the Sustainable Palm Oil Manifesto, of which Sime Darby Plantation is a signatory, commissioned the High Carbon Stock (HCS) Science Study, which was aimed at clearly defining what constitutes a HCS forest, and establish HCS thresholds that takes into account not only environmental concerns but also socio-economic and political factors in developing and emerging economies. The HCS Science Study, which is supported by a wide range of stakeholders worldwide, has proposed HCS+ as a guide for oil palm growers to develop plantations that are carbon neutral, conflict-free, transparent and equitable to all stakeholders.
Case studies
  • Biogas
    Under our Carbon Reduction Strategy, we have identified Biogas as the main driver for carbon emission reductions.
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  • Biomass
    As part of our commitment to reducing waste and emission, and in improving energy efficiency, we are working towards implementing moregreen and renewable energy in our operations.
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  • Composting
    Co-composting of empty fruit bunches (EFB) and palm oil mill effluent (POME), along with other palm oil mill waste, is a major initiative of Sime Darby Plantation towards reducing carbon emissions and managing waste effectively.
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