Carbon Reduction Plan
Commitment to achieving Net Zero
Algeco UK Limited is committed to achieving Net Zero emissions by 2050.
Baseline Emissions Footprint
Baseline emissions are a record of the greenhouse gases that have been produced in the past and were produced prior to the introduction of any strategies to reduce emissions. Baseline emissions are the reference point against which emissions reduction can be measured.
Current Emissions Reporting
Our 2021 data is being limited assured by PwC. Our verified data will soon be published.
Emissions reduction targets
In order to continue our progress to achieving net-zero, we have adopted the following carbon reduction targets.
We project that carbon emissions will decrease over the next seven years to 5,440 tCO2e (market-based method) by 2028. This is a reduction of 15.8% in comparison to the 2020 baseline.
Priority is to reduce the absolute tCO2e by 2.5% year on year.
Our parent company has completed a c.EUR2.75 bn sustainability-linked financing. The sustainability-linked features incentivise us to achieve ambitious, predetermined sustainability performance objectives. Our carbon reduction targets therefore align with our parent company’s as follows:
This is a requirement and will be externally measured, reported to investors and disclosed in reports and website. By aligning financing to our sustainability performance signals a strong commitment to implement Algeco UK aligning with Modulaire Group’s sustainability agenda to achieve net-zero by 2050
The Sustainability-Linked Financing Framework was established in accordance with the recommendations of the Sustainability-Linked Bond Principles (SLBP), as administered by the International Capital Markets Association (ICMA) in June 2020 and Sustainability-Linked Loan Principles (SLLP). Modulaire has also taken note of the European Leveraged Finance Association's (ELFA) Best Practice Guide to Sustainability-Linked Leveraged Loans, published in July 2021 when preparing this Sustainability-Linked Financing Framework. The Framework can be viewed on https://www.modulairegroup.com/investors/sustainability-linked-bond)
Carbon Reduction Projects
Completed Carbon Reduction Initiatives
We have been implementing the following environmental management measures and projects since the 2020 baseline. The carbon emission reduction achieved by these schemes will equate to 646 tCO2e, a 10% reduction by 2024 against the 2020 baseline.
Outline of Action Plan related to Scope 1 & 2 by 2024 include:
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Resource Efficiency – tackle resource efficiency opportunities everywhere in our operations examples of net-zero Carbon Energy efficiency measures: Air Source Heat Pump; Ground Source Heat Pump; Solar thermal hot water; Photo Voltaic panels; Wind turbine District heating, Occupancy control lighting, LEDs, Lower heating set points, Boiler sequencing, Outdoor lighting requalification, HVAC control settings, Insulation, Double-glazing, Electrification plant replacement.
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Green Logistics – Switching to Lower Carbon Fuels, Green Fleet Management, Electrification of Fleet and Driving Efficiency Programmes.
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Renewable Energy – source 100% of renewable electricity for the Group where available from 2023 onwards. Our strategy is to investigate in depth across our geographies where certifiable Renewable energy is available and then implement the renewable plan which makes strategic, operational and financial reasoning, fully backed by REGO certificates.
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Behavioural Change – Implementing employee awareness programme for resource efficiency, employee feedback and standardised processes to increase resource efficiency
Frameworks
Our Environment Social Governance (ESG) & Sustainability strategy follows our parent company – Modulaire’s strategy. Our strategy therefore has integrated three key frameworks the United Nations Sustainable Development Goals (SDG), the United Nations Global Compact (UNGC) and the Task Force on Climate-related Financial Disclosures (TCFD). This adds to and complements our business model based on the circular economy.
Five SDGs that complement our business purpose, vision and operations are SDG 12 (Responsible Consumption and Production); SDG 9 (Industry Innovation and Infrastructure); SDG 13 (Climate Action); SDG 4 (Quality Education); SDG 5 (Gender Equality); SDG 11 (Sustainable Cities and Communities).
We (under our parent company’s brand) became signatories to both the United Nations Global Compact (UNGC) in April 2021 and are currently updating policies to reflect the ten principles.
Our parent company became signatories to Task Force on Climate-related Financial Disclosures (TCFD) in May (2020) and based our roadmap to NetZero on the recommendations of the TCFD report.
Measures in place to reduce GHGs
We monitor and report on key KPI’s relating to GHGs. The KPI’s are used as part of the senior team reports ensuring we stay within the set limits and also allow us to measure progress against set objectives.
The Corporate GHG footprint is calculated in accordance with the WRI/WBCSD GHG Protocol Corporate Accounting and Reporting Standard. Emission factors: Scope 1: Defra 2020, Scope 2:Grid average (Location based): Defra 2020 for the UK. Residual mix (applied for non-renewable energy under market-based method): “AIB (2020) European residual mix 2019” for all European countries (including the UK).
In the future, we will implement further measures such as:
Following the leadership from our parent company, we will establish a Scope 3 operational carbon baseline in 2022 and will look to roll out a strategy to reduce Scope 3 emissions in the following year. We are also seeking to establish Science Based Targets going forward and aim to have this process completed by 2023
Declaration
This Carbon Reduction Plan has been completed in accordance with PPN 06/21 and associated guidance and reporting standard for Carbon Reduction Plans.
Emissions have been reported and recorded in accordance with the published reporting standard for Carbon Reduction Plans and the GHG Reporting Protocol corporate standard1 and uses the appropriate Government emission conversion factors for greenhouse gas company reporting2.
Scope 1 and Scope 2 emissions have been reported in accordance with SECR requirements, and the required subset of Scope 3 emissions have been reported in accordance with the published reporting standard for Carbon Reduction Plans and the Corporate Value Chain (Scope 3) Standard3.
This Carbon Reduction Plan is extracted from the overall ESG & Sustainability strategy of our parent company that has been reviewed and signed off by the Board of Directors.