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Woolworths Cuts CO2 Intensity 8% as Carbon Tax Looms

Woolworths Limited achieved a carbon intensity of 881 tons of CO2e per $m EBIT in 2011, eight percent below the 2010 level of 956 tons per $m, according to the Australian mega-retailer’s latest corporate responsibility report.

For 2011, Woolworths’ total carbon emissions in Australia and New Zealand were 4.09 Mt, the same as 2011, while the business grew financially. The company attributed the static level of emissions to ongoing investments in energy efficiency, improvements in logistics, and a change to refrigerants with a lower global warming potential.

Woolworths Limited is Australia’s largest retailer, with 3,241 retail stores and 190,723 employees in Australia, New Zealand, China and India. Its brands include the Woolworths, Countdown, Foodtown and Supervalue supermarket chains; Danks home improvement stores; ALH hotels; Dick Smith electronic stores; and Big W general merchandise stores.

The report said that emissions from Woolworths facilities totaled 3.42 Mt in 2011, which is a 1.4 percent reduction in emissions compared to the previous year, and a 10.9 percent reduction compared to its original projected growth in emissions for 2010. The company has a goal to reduce its CO2e by 40 percent by 2015, from projected growth levels, bringing emissions back to 2006-07 levels.

The firm’s group engineering team started 37 new projects in 2011, which reduced electricity use by 18,842 MWh.  Since 2007, Woolworths has invested $55.7 million in energy efficiency projects, which it expects to deliver about $93 million in savings by 2015.

The company also began to install reflective roof surfacing and improved air conditioning controls at its Big W stores, and is implementing energy management systems at Dick Smith, Dan Murphy’s, BWS and Petrol stores. It has a goal of a 25 percent reduction in CO2e emissions per square meter for new sustainable store designs, compared with business-as-usual designs in 2008, and has achieved a 22.8 percent reduction so far.

Woolworth said its logistics fleet has reduced emissions through improved consolidation of loads, network optimization and the transition to biodiesel made from waste material. The company car fleet’s conversion to diesel and hybrid options is now 93 percent complete, but due to acquisitions and growth in the business the fleet is 20.7 percent larger than it its 2008 baseline level.

The company is aiming to reduce CO2e emissions per carton delivered by Woolworths-owned trucks 25 percent by 2012, and to reduce emissions from its company car fleet by 30 percent by 2010, both from a 2008 baseline.

Meanwhile Woolworths’ emissions of ozone-depleting substances in 2011 were 45 percent up on 2010 levels, with 35.7 tonnes emitted from refrigerant gas loss this year, primarily R22 from air conditioning.

In the report, Woolworths said the Australian government’s price on carbon will affect the business by raising pass-through costs from upstream sources, such as energy supplies and the cost of goods, and from downstream costs such as landfill levies. But the company said that it has made significant investment in low-carbon technology to minimize the impacts of the carbon price.

Its last water use goal expired in 2010, but Woolworths says it continues to monitor water use and the ongoing savings from investment in water efficient fittings, equipment and infrastructure. It says it saved 317 million liters of water in Australian supermarkets in 2011, using 1.83 GL, and says its average water use per supermarket continues to decrease.

Recently it installed a large-scale rainwater harvesting project at its Melbourne National Distribution Center, with investment from the Hawthorn Football Club. Woolworths provides the roofing for rainwater capture and land for installing tanks, and the water is used to irrigate the club’s training field as well as residential areas.

Woolworths says its water focus has shifted further towards the supply chain, particularly to farmers. It is funding the development of a water footprint module for horticultural suppliers.

In 2011 the company finalized its sustainable packaging guidelines and will use them to review the packaging of new and existing private label products. Its liquor division implemented a project to reduce the weight of glass used in the bottles of 17 private label wine products, saving an estimated 854 tons of glass.

Waste to landfill from the company’s supermarkets in Australia and New Zealand fell by 0.7 percent in 2011, whilst recycling volumes increased by 2.7 percent. Woolworths has a goal of zero food waste in the waste stream by 2015, where facilities are available, and says it has now conducted a comprehensive assessment on all opportunities for diverting food waste from Australian supermarkets to beneficial reuse, including stock feed, composting, and waste to energy.

One of the opportunities identified led to a trial in Adelaide that diverted 194 tons of food from nine stores to a commercial composting facility in eight months. This trial will expand to include over 30 stores, the report said.

Woolworths says it implemented a waste audit program for supermarkets in 2009, but no waste audits were conducted during 2011.

In 2011 it reduced office paper use at its support offices by 51,396 reams, an 18.4 percent reduction compared to the previous year. It has completed the transfer to FSC certified office paper for all Australian businesses (excluding ALH).

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