Climate change is an issue relating to sustainability and human’s well-being. It has become the global concern pulling collaborations across the world to reduce the GHG emissions and alleviate its impacts. This can be seen from the Paris Agreement of which many countries jointly set up the GHG emissions target to keep an increase of the global temperatures well below two degrees Celsius. As such, the policies and laws regarding climate change have been issued such as the Emission Trading Scheme (ETS), an increase in the supporting scheme for renewable energy investment, etc.
The Company operates power generation business, which has activities causing GHG emissions as follows:
|Direct GHG Emissions (Scope 1)||Indirect GHG Emissions (Scope 2)|
GHG Emissions Management in Power Business
The Company promotes the use of High Efficiency, Low Emissions (HELE) technology for power generation and a support scheme to increase a proportion of renewable power generation projects. The management approaches to reduce greenhouse gases are as follows:
• Base-load power plants under operations
The Company emphasizes the use of technologies to improve power plant efficiency, inspect the equipment regularly, and is also looking for opportunities to use a variety of fuels in response to the stakeholders, being able to get fuel supplied in the area such as natural gas, biomass and industrial waste gas, for instance, which divided by management control as follows:
The combined heat and power (CHP) plants in China are able to consume energies efficiently, having 25% energy loss during a full production capacity of steam and electricity. Meanwhile the thermal power plants solely generating electricity will lose about 65% of production energy. This has led the combined heat and power plants to have low energy consumption rate and greenhouse gas emissions intensity. Customer’s demand to purchase steam at different times, however, will directly affect the efficiency of energy consumption and greenhouse gas emissions. The Company therefore, focuses on using innovation to improve the power plant efficiency. Additionally, the Company together with Banpu Group, has monitored and verified the accuracy of the greenhouse gas emissions database.
The thermal power plants which are the joint venture companies, namely BLCP Power Plant and Hongsa Power Plant, focus on the quality management and annual quality assurance. This also includes the implementation of an information technology to predict a machinery maintenance before the machine is broken (Predictive Maintenance). It will have an effect on the power plants’ efficiency reducing the fuel consumption per unit of product and Equivalent Availability Factor (EAF) as designed. They are the important performance indicators reflecting the readiness and efficiency of the power plants, and directly affecting the reduction of greenhouse gas emissions. Respectively, the Company has the Asset Management Unit in collaboration with its business partners who jointly invest in the power plants, monitor the GHG emissions of our power plants.
• Base-load power plant projects that are under development and expanding production capacity
The Company has chosen High Efficiency, Low Emissions (HELE) technology to develop the thermal power plants and combined heat and power plant projects in the future. For example, using the ultra- supercritical technology, the latest technology for thermal power plants, to design and construct the Shanxi Lu Guang (SLG) Power Project which is under construction.
• Renewable power plant projects
The Company has set its targets to invest more in renewable power plant projects, no less than 20% by 2025. The investment in renewable power plants will help reduce the Company’s GHG emissions intensity. At present, the Company has the solar power plant and wind power plant projects which are under development. We are also seeking opportunities to generate more renewable electricity to achieve the goals.
Opportunities to Investment in Clean Energy as a Part of Low Carbon Society in the Future
The Company is looking for opportunities to invest in solar power plants in countries with clear supporting policies. In addition, the Company has invested in related businesses continued from its existing power generation business in order to create added values. This includes the power trading business operated through the central platform and retail electricity or a so-called ‘Energy Trading and Retail Electricity’ in Japan by expanding the opportunity to do business with retail customers and rooftop solar energy producers. The aim is to respond to customers’ demand in the business and industrial sectors as well as a group of customers who want to use electricity from the renewable energy.
Increasing the Potential for Adaptation to Risks relating to Climate Change
• Production Risk Management: The Company has adopted the Business Continuity Management System (BCMS) in preparation for events interrupting business operations such as natural disasters pandemic. Consequently, the Company will be able to deliver products and services to customers and various stakeholders immediately.
• Changes in policies and regulations regarding energies and GHG emissions: The Company has a responsible unit to monitor and anticipate changes in regulations in all areas open for operations at the local and central governments in order to be able to adapt itself to the changing environmental quality standards that are more concentrated. It is also looking for opportunities to invest in the renewable energy business receiving more supports from the government.
The Company together with Banpu Group has established the Climate Change Committee to be responsible for managing the climate change risk holistically, leading to a reduction of GHG emissions in the future.
In the past year, the Company used the internal carbon price which would determine the GHG cost in various areas used as part of the cost to analyze the investment value and possibility of new projects in the future. The Company focused on low carbon emission projects and factors to reduce the Company’s GHG emissions reduction in order to achieve the goal set and to be prepared for adaption to the possibility of legal changes and enforcement to reduce GHG emissions in the near future.
The Company conducted a preliminary assessment of indirect GHG emissions (Scope 3) which involved operational activities as follows: