We are helping to mitigate climate change and contributing to compliance with the Paris Climate Agreement. In 2013, we adopted a Group-wide climate protection target for the first time: By 2020, we planned to reduce CO2e emissions by 20 percent compared to the base year 2008 (excluding T-Mobile US). We have achieved this target. Our current climate targets for the period after 2020 were adopted by the Board of Management in 2019 and their ambition level was raised in March 2021:
- By the end of 2021, we intend to source 100 percent of the electricity used by the Group from renewables (Scope 2). In Germany, we have already reached this goal by the end of 2020.
- By the end of 2025, we want to achieve climate neutrality in the company. To achieve this, we want to reduce our CO2 emissions by up to 95 percent compared to 2017 (Scope 1 and 2) and offset remaining emissions through suitable offsetting measures. In addition to switching to renewably sourced electricity, we plan to achieve this especially by implementing energy efficiency measures.
- Over 80 percent of our CO2 footprint arises from the production and use of our products. We plan to achieve a 25 percent reduction per customer in these emissions by 2030 (versus 2017) (Scope 3, categories: goods and services acquired, capital goods, use of sold products, rented or leased equipment). We maintain a close dialog with our suppliers in order to reduce the emissions generated during production and to ensure the products manufactured consume less energy during the utilization phase.
These targets were developed on the basis of the “Science Based Targets initiative” (SBTi). The SBTi officially confirmed in May 2019 that we are the third DAX-listed company to contribute toward implementing the Paris Climate Agreement through our climate protection targets. We have thus followed our national companies in the United States and Hungary, whose targets were already endorsed by SBTi in 2018 and at the start of 2019, respectively.
Integrated climate strategy
Our integrated climate strategy is based on four pillars: Emissions from the value chain, renewable energy, energy efficiency, and enablement: positive climate protection effects for our customers. We have defined objectives and/or key performance indicators for each of the four pillars.
The four pillars of our integrated climate strategy
We record all direct and indirect emissions using the globally recognized “Greenhouse Gas (GHG)” Protocol. Most of our emissions are caused by the use of electricity. To reduce our emissions, our primary focus is on increasing the share of renewable energies in the electricity mix (see “Renewables”). We will also reduce emissions produced through the use of gas and oil, for instance. In addition, we will improve efficiency in areas with particularly high energy consumption, especially in our networks and data centers. This has already allowed us to reduce our emissions over the past few years – despite rapidly growing data volumes and the necessary network build-out. Indirect emissions from the upstream and downstream value chain (Scope 3 emissions) make up the largest share of our total emissions. We maintain a close dialog with our suppliers in order to reduce the emissions generated during production and to ensure the products manufactured consume less energy during the utilization phase.
By the end of 2021, we will obtain all our electricity needs from renewable sources, and hence also convert the entire Deutsche Telekom network, across the entire gamut from mobile telecommunications to the high-speed DSL network, to use electricity entirely from renewable sources. To that end, we aim to expand our own production and conclude power purchase agreements (PPAs). In 2020, a PPA was signed in Germany for the first time for a wind farm in Mecklenburg-Western Pomerania. We are currently drawing up a guide for the entire Deutsche Telekom Group, the purpose of which is to support our various national companies in choosing the ideal solution for their individual needs by providing information on the various options they have available for the purchase of green electricity. We already sourced 100 percent of the electricity from renewable sources in 2020 in the following countries: Germany, Greece, Croatia, the Netherlands, Austria, and Hungary.
Because the operation of our network infrastructure calls for a considerable amount of energy, we are also investing in energy-efficient technology to reduce CO2 emissions. For instance, we are migrating our network infrastructure to IP technology, which is not only more powerful, but also consumes less electricity than existing technologies. The migration is 99.8 percent complete. In addition, we are working to process data traffic from no more than a few, particularly efficient data centers. The PUE factor serves as an indicator for enhancing the energy efficiency in our data centers. We determine this metric using the method recommended by The Green Grid Association, In order to measure our progress, we use also the key performance indicators (KPIs) Energy Intensity and Carbon Intensity.
Many of our products and services provide sustainability advantages. They can help reduce energy consumption and CO2 emissions, improve healthcare and make logistics more efficient. In addition to our own carbon footprint, we also calculate the positive CO2 effects facilitated for our customers through using our products and solutions. We assess both variables in relation to the “Enablement Factor” ESG KPI. This helps us evaluate our overall performance in relation to climate protection. By increasing sales of sustainable products and solutions and reducing our own emissions, we aim to further improve the enablement factor in the future.
Alignment with core business
We see ourselves as a responsible company and have made that a core element of our Group strategy. Our Corporate Responsibility strategy is derived from this and covers three fields of action. The climate protection strategy specifies the “Low-carbon society” field of action. This is how we ensure that climate protection measures are closely connected with our core business.
To support the climate protection strategy and achieve the ambitious Group targets, the national companies have developed and implemented their own climate protection strategies, concepts and measures. These can be viewed in the relevant profiles.Reporting against standards
- GRI 305-5 (Emissions)
- The most important key figures for measuring and managing climate-related opportunities and risks
Our approach to measuring our progress with regard to climate protection
We calculate our emissions for our climate targets along the entire value chain according to the market-based method of the internationally recognized Greenhouse Gas (GHG) Protocol. We have broken down all our CO2e emissions in detail here.
The emissions make up various KPIs that we use to measure our contribution to climate protection and make our progress transparent. The Carbon Intensity and Energy Intensity KPIs are used to analyze the relationship between our CO2e emissions or energy use and the transmitted data volume. Using data volume as a reference parameter makes it possible to create a direct link to the performance of our networks. The Enablement Factor, PUE, and Renewable Energy KPIs also improve the management and transparency of climate protection issues.
Indirect emissions along our value chain, or Scope 3 emissions , make up the majority of our total emissions. By recording them, we lay the foundation for reducing emissions in our value chains through targeted measures together with our suppliers and customers.
The Board of Management is informed each year in detail by the Group Corporate Responsibility (GCR) unit about the status of the programs we have implemented to achieve our climate targets. In 2020, as in the previous years, we succeeded in further reducing our emissions.
Climate target achievement KPI
The achievement of the climate targets was at the forecasted level at the end of the year. Base year emissions were recalculated based on the merger of T-Mobile US and Sprint and are therefore above the 2017 level communicated in the last report.
Our targets foresee reducing Scope 1 and Scope 2 emissions by up to 95 percent already by 2025 compared to 2017 and compensating for remaining emissions through appropriate offsetting measures in order to achieve climate neutrality in our own operations.
Over 80 percent of our CO2 footprint arises from the production and use of our products. We plan to achieve a 25 percent reduction per customer in these emissions by 2030 (versus 2017) (Scope 3, categories: goods and services acquired, capital goods, use of sold products, rented or leased equipment).
We also aim to achieve net-zero emissions across all three scopes by 2040. The goal is to remove all emissions that have not yet been reduced from the atmosphere throughout the entire value chain.
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Alignment with the recommendations of the TCFD
The United Nations Climate Change Conference hosted in Paris in 2015 saw the launch of the “Task Force on Climate-related Financial Disclosures” (TCFD ), which sets out to develop voluntary, consistent climate-related financial risk disclosures. In 2017, the TCFD published specific recommendations for putting these disclosures into practice, which companies can use as a guideline to inform investors, lenders, insurers, and other interest groups about the risks climate change presents for their business model.
Deutsche Telekom welcomes the aims behind the TCFD. Among the risks that climate change harbors, meteorological extremes are one we are already experiencing. This is having a direct effect on our stakeholders, e.g., our customers, suppliers, and employees. The risk is assessed in relation to the continuation of operations as part of risk management and is managed at an operational level in the business units. In addition, we evaluate internally how reporting on climate-related financial risks and opportunities can be aligned with the recommendations of the “Task Force on Climate-related Financial Disclosures” (TCFD). This should build on the existing approaches for strategy, controlling, and risk management.
|a) Describe the Board’s oversight of climate-related risks and opportunities.|| || |
|b) Describe management’s role in assessing and managing climate-related risks and opportunities.|| || |
|a) Describe the climate-related risks and opportunities the organization has identified over the short, medium, and long term.|| || |
|b) Describe the impact of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning.|| || |
Please note: We are currently evaluating internally how reporting on climate-related financial risks and opportunities can be aligned with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). This is to be based on the existing approaches to strategy, controlling and risk management.
|c) Please note: We are currently evaluating internally how reporting on climate-related financial risks and opportunities can be aligned with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). This is to be based on the existing approaches to strategy, controlling and risk management.|| || |
|a) Describe the organization’s processes for identifying and assessing climate-related risks.|| || |
|b) Describe the organization’s processes for managing climate-related risks.|| || |
|c) Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk management.|| || |
Metrics and Targets
|a) Disclose the metrics used by the organization to assess climate-related risks and opportunities in line with its strategy and risk management process.|| || |
|b) Disclose Scope 1, Scope 2, and if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks.|| || |
|c) Describe the targets used by the organization to manage climate-related risks and opportunities and performance against targets.|| || |
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Progress in implementing the TCFD recommendations
Deutsche Telekom welcomes the TCFDhere). In various workshops with experts from technology, purchasing, strategy and risk management, we defined the material climate-related risks and opportunities and carried out an initial weighting. On the one hand, we considered the consequences for our business activities that could result from the physical impacts of progressing climate change. On the other hand, we have also analyzed the effects that could result from political, technological and social developments associated with the transition to a low-carbon economy.recommendations and is committed to implement the goals. As a first step, we conducted a gap analysis to see to what extent our measures already comply with the TCFD recommendations (see
A key climate-related risk is the potential failure of network infrastructure due to damaged secondary infrastructure (power outages, e.g.) or failed cooling equipment. Another risk is the possible damage to or failure of the network due to damage to the network infrastructure itself, which may occur as a result of climatic events or changes in climatic conditions. In contrast, we identified the increasing use of energy-efficient technologies (in grid operation, e.g.) and the growing demand for climate-friendly products and services as significant climate-related opportunities.
In the next step, we analyzed - on an initial exemplary basis - 500 Deutsche Telekom AG sites in Germany with regard to their physical climate risks. This climate risk analysis was prepared using the "Climate Change Edition" of the "Location Risk Intelligence" software from reinsurer Munich Re. The analysis comprises eight indices (see graphic). We consider the risk exposure for the respective locations in two climate scenarios of the Intergovernmental Panel on Climate Change (IPCC): a business-as-usual scenario (RCP 4.5), in which the global temperature increase will be more than two degrees, and a four-degree scenario (RCP 8.5). In addition to the climate scenarios, we also examine the risk exposure in different time frames: current, for the year 2050, and for 2100.
The following graph shows a sample of the results: The risks for the year 2050 according to the 4-degree scenario:
Maximum intensity of cyclones with a probability of exceedance of 10 % in ten years (corresponds to a return period of 100 years).
Hazard zones derived from statistical data on sea level rise and altitude data for the respective projection year and scenario.
The Fire Stress Index describes current meteorological fire conditions based on fire hazard models. These combine inflammation probability, speed and spread probability, and fuel availability into a combined metric. The Fire Stress Index includes information on the length of the fire season and extreme fire danger days, for example.
The Precipitation Stress Index describes the current meteorological threat of heavy precipitation. The threat is derived from information about e.g. one-day heavy precipitation events and long-lasting precipitation events.
The Drought Stress Index describes the change in water balance derived from the modelled standardised precipitation evapotranspiration index (SPEI). This multi-scale drought index is based on climatic data and is used to determine the duration, intensity and severity of drought conditions compared to normal conditions (in reference periods).
The Heat Stress Index describes the current meteorological threat from heat. The threat is derived from information on e.g. heat waves, annual maximum temperature and tropical nights.
Areas at risk of extreme floods with return periods of 100 or 500 years. Does not take into account dikes.
Areas at risk of extreme floods with return periods of 100 or 500 years. Flood protection is taken into account.
In the future, we intend to analyze the risks and opportunities identified as material in the different climate scenarios. We also plan to extend the physical climate risk analysis to further countries.
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Addressing climate risks
In the context of our integrated climate strategy, we determine climate-related risks and opportunities both for us as a company and for our stakeholders. Our Board of Management is informed quarterly about current climate risks in a Group Risk Report. You will find more information on risk management in the “Risk and opportunity management” section of our annual report.
Extreme weather conditions as a consequence of climate change will have a negative impact on our business processes and will inevitably lead to incidents or even network outages. Among the effects of such breakdowns is their massive impact on the management of rescue operations, for example, sometimes even rendering such emergency efforts entirely impossible. In order to be able to react appropriately in these cases, we have defined the necessary responsibilities, processes, and measures in our internal “Group Policy on Continuity and Situation Management”. The policy also outlines how to handle emergency and crisis situations like floods.
We also take possible consequences of climate change into account when planning our future business activities. For example, our network infrastructure is set up to be better protected from storm conditions, changes in temperature, and high winds.
Climate change also carries financial risks, whether from levies on CO2 emissions or an increase in energy costs. Our contribution to the mitigation of these risks includes measuring our own energy efficiency and developing measures for improvement. To prevent infrastructure failure due to extreme weather events, additional investment in a more robust infrastructure might be necessary.
We also help our customers reduce their own carbon footprint, thus helping to mitigate climate change, by providing them with innovative solutions. Possible examples include projects in the area of sustainable urban development and mobility, and also a real-time solution for agriculture (“Precise Positioning”). It can be used, for instance, to correct GPS data that is often too inaccurate for agricultural purposes and transmit precise location data in real time – using 5G mobile technology. Our low-threshold, comparatively inexpensive solution helps farmers deploy their machinery with greater precision to reduce emissions, dose fertilizer and seeds more accurately, and increase their yields. That way we can also make an indirect contribution to achieving the second sustainable development goal (SDG) of “zero hunger”.
We also help our customers deal with the adverse effects of climate change (adaptation). In the event of an imminent catastrophe, our infrastructure can be used, for example, to send alerts via early warning apps.Reporting against standards