According to the latest status report published by the Intergovernmental Panel on Climate Change (IPCC), global CO2 emissions continue to rise; their impact on people and the environment will be significant. We need innovative solutions to lessen this impact and slow down global warming. There are a number of good examples of how ICT can reduce emissions in many industries like transportation and agriculture. We believe it is our responsibility to systematically expand our business with solutions like these. The growing amounts of data in our networks and at our data centers, however, require more energy. We tackle the challenge of reducing our energy consumption despite this situation by increasing the efficiency of our network infrastructure. Within the scope of our Group-wide climate protection strategy, we also reduce our carbon footprint through effective energy management at our buildings and climate-friendly policies for our vehicle fleet management.
"We assume responsibility for a low-carbon society" is one of the key action areas of our CR strategy. We intend to keep this promise with the help of our Group-wide climate protection target, which was adopted in 2013: to reduce our CO2 emissions by 20 percent by 2020 compared with 2008. We have developed measures to help us meet this target as well as instruments to gauge our progress. An annual status report keeps the Board of Management informed regarding progress toward achieving this target.
Measurable success in climate protection
We record the direct impact of our climate protection measures with our Energy Consumption and CO2 Emissions key performance indicators (KPIs) in order to assess the effectiveness of those measures. These KPIs also help us keep our stakeholders informed regarding the progress we have made in achieving our climate target. In 2014 we reviewed the effectiveness of our KPIs and made adjustments to our CO2 Emissions KPI.
Measuring direct and indirect emissions
We measure our CO2 emissions on the basis of standards such as the internationally recognized Greenhouse Gas (GHG) Protocol, which distinguishes between three CO2 emissions categories: GHG Scope 1, 2 and 3. Over the past few years, we have introduced measurement of GHG Scope 1 and 2 emissions throughout the Group. Our CO2 Emissions KPI is based on this data. We have been annually recording all Scope 3 emissions generated by our business in Germany that are relevant to the company since 2013. We published the values from 2012 and 2013 for the first time in 2014 within the context of the Carbon Disclosure Project survey.
Collaborating for innovation and climate protection
Effective climate protection calls for joint efforts on the part of business, politics, science and society. We are involved in a number of German initiatives (2° foundation in Germany) and international associations to help us effectively work to protect the climate. One of these is the Global e-Sustainability Initiative (GeSI ). As an industry association, GeSI 's vision is to help make society greener and more climate-friendly with the help of ICT solutions.
Using electricity from renewable energy sources
Measures to improve the energy efficiency of our networks and infrastructures are at the heart of our climate protection strategy. To date, we have not included renewable energy in our calculations regarding our Group-wide climate protection target. Renewable energy, however, can help reduce CO2 emissions. That is why we attach great value to the use of renewable energy, which will play an important role in our integrated climate strategy in the future. In 2014 we took stock throughout the Group in order to assess the potential of renewable energy in terms of climate protection at the Group. The next step will be to come up with specific targets to increase the share of green power in our energy mix.
Developing an integrated climate strategy
In addition to approving our Group-wide climate protection target of reducing our CO2 emissions by 20 percent between 2008 and 2020, the Deutsche Telekom Board of Management decided in December 2013 to continue to enhance the tools that will help us achieve this target. These include monitoring and, where necessary, realigning our climate protection measures as well as identifying additional measures to increase our efficiency and finding new ways to use renewable energy. Our efforts to enhance our tools will also take into account the analysis of CO2 emissions generated by T-Mobile USA, which have so far not been included in our climate protection target.
Integrated climate strategy based on four pillars
In 2014, we worked together with all of the national companies participating in the climate protection target to identify additional ways to reduce energy consumption including data centers, buildings, vehicle fleets, IT and business trips. The discussion also made it clear that we could reduce our Group-wide carbon footprint by using more renewable energy. Increased inclusion of renewable energy in calculating Scope 2 emissions, an element of the new version of the Greenhouse Gas (GHG) Protocol, will contribute to this as well. Measures in this area will therefore have a positive impact on our carbon footprint.
The estimated CO2 emissions generated by T-Mobile USA pose a challenge to our climate protection efforts. Emissions there are expected to increase between 2008 and 2020 due to heavy network expansion in North America. That is why during the reporting period we discussed how to make our climate protection activities more effective.
As a result, we decided to continue to make our climate protection efforts more systematic and to develop a new, integrated climate protection strategy in 2015. Based on the four pillars - CO2 emissions, renewable energy, energy efficiency and green products - this integrated strategy will include concrete targets and performance indicators and will support our Group strategy of becoming the "leading telecommunications provider in Europe."
One step in this strategy will be to analyze the CO2 reduction potential of our ICT products and services so that we can continue to expand our business with customer solutions for climate protection. To make this possible, we plan to measure the carbon footprint of our products in a pilot project and gradually make CO2 reduction a fixed aspect of our portfolio. Emission reductions have already been calculated for the three pilot products Dynamic Workplace, Connected Car and Smart Metering.
Measuring Scope 3 emissions along the value chain
In June 2014, we published all of Deutsche Telekom's Scope 3 emissions in Germany for the first time within the context of the CDP (formerly Carbon Disclosure Project). We included relevant data for 2012 and 2013 in this calculation. The two largest sources of Scope 3 emissions in 2013 were customer use of products purchased from us and our supply chain. We calculated Scope 3 emissions for 2013 totaling at 3,730,091 metric tons of CO2 equivalents.
Our Scope 3 emissions for 2014 were up 6 percent year on year at 3,965,268 metric tons of CO2 equivalents. This increase can primarily be attributed to our rising purchase volume (e.g., smartphones and tablets) as well as to the use of products (e.g., routers and receivers) leased from us by our customers. We saw a drop in Scope 3 emissions for fixed assets, e.g., the technology required to operate our fixed-line and mobile communications networks.
In order to record the Scope 3 emissions along the supply chain more efficiently, we invited around 100 of our suppliers to participate in the CDP supply chain program. The program gives businesses and their suppliers a standardized platform for recording and controlling emissions. We also tested a macroeconomic approach to measuring Scope 3 emissions. In this approach, the calculation of the emissions along the supply chain are based on lump-sum amounts. We are currently looking into the deviations between the results of both approaches in order to improve the method we use.
We plan to measure Scope 3 emissions throughout the entire Group by the end of 2016.
More green energy at European national companies
We aim to achieve a share of power from renewable sources at all of Deutsche Telekom's national companies in Europe that is 10 percent higher than in the national energy mix by 2016 – if permitted by the conditions of the national energy markets. To this end the national companies can also purchase renewable energy certificates if needed, a practice already in place in the Netherlands, Hungary and Greece.
By increasing our reliance on renewable energy, we hope to tap new ways to reduce CO2 emissions and our energy consumption beyond what we are already doing within the scope of our Group-wide climate protection target. To help us in this, we worked together with our national companies in 2014 to analyze other ways to use renewable energy. The first step was to take stock of the present situation at each company in order to give us a basis from which to start. The next step will be to come up with measures that increase the share of renewable energy being used throughout the Group and that help us meet customer demands and the provisions of international climate protection agreements.
Another option: CO2 compensation
Preventing greenhouse gas emissions has top priority at our company. This is followed by reducing these emissions. Investing in certified climate protection projects is one way to compensate for some of the CO2 emissions that we are unable to avoid generating or reduce.
From early March 2014 to late February 2015, Telekom compensated for 12,517 metric tons of CO2 emissions. These included emissions associated with our events (participant travel to and from the event, room usage, etc.) and certain products and services (e.g., conference calls or web conferences). Our Event Policy specifies the ways in which we compensate for emissions generated by events.
In 2014 T-Systems Hungary also compensated for 14,285 metric tons of CO2 resulting from energy consumption.