Borneo, Green Energy & Co.: What Volkswagen is Doing for the Environment

Volkswagen is pursuing the goal of becoming balance sheet CO2-neutral by 2050. We show what the Group is doing to avoid and offset carbon dioxide on the road to a green zero.

Climate protection is one of the greatest global challenges facing mankind. At the 2015 World Climate Conference in Paris, 197 countries committed themselves to limiting global warming to well below two degrees compared with the pre-industrial age – and thus to continuously reducing emissions of the greenhouse gas carbon dioxide (CO2), which is mainly responsible for the rise in temperatures.

Volkswagen is committed to the Paris Agreement and has developed a Group decarbonization program for this purpose, which is currently being implemented. By 2025, the company aims to reduce the carbon footprint of cars and light-commercial vehicles across the entire value chain by 30 percent compared to 2015 – and by 2050 to make the entire Group’s balance sheet CO2 neutral. The goal: A green zero.  

Significance of the CO2 footprint
Every person and every company consume raw materials, use energy and produce waste and emissions. Even those who act in a climate-friendly manner, cannot completely prevent CO2 emissions. The CO2 footprint measurement records the CO2 emissions that a person generates through living, mobility, nutrition and consumption.

All measures follow a three-level hierarchy: reduce, convert and compensate. First and foremost, therefore, are actions to avoid or reduce CO2 emissions. In the second phase, the energy supply in the entire value chain is converted to less CO2-intensive or renewable energy. Unavoidable CO2 emissions across the Group are offset through climate protection projects that meet the highest international standards.

The focus is on switching to electric mobility as the best and most efficient way of creating climate-friendly mobility. Another key element is the complete analysis and recording of CO2 emissions at all stages within the automotive value chain. This means recording the entire life cycle of a vehicle – from the extraction of raw materials, through to the production-and-use, and then right up to the recycling stage.

Focus: Electromobility
The Volkswagen Group has launched the largest E-offensive in the automotive industry. In the next few years, around 70 E-models will be launched across the Group. By 2030 at the latest, all brands will have electrified their entire portfolio. Each of the approximately 300 models will then be available in at least one fully electric and hybrid version. To this end, Volkswagen Group is investing heavily in the mobility of the future: by the end of 2022, more than 30 billion euros are expected to have been invested. Over the next few years, the joint ventures in China will invest a further 15 billion euros. E-cars will be built at eight locations in Europe, China and the USA. The E-strategy is based on the modular electric drive matrix (MEB), a technology platform created specifically for E-vehicles.

Focus: Life Cycle
The Volkswagen Group determines the CO2 balance over the entire life cycle of a vehicle. To this end, Volkswagen has adopted a Group-wide comprehensive decarbonization program with the aim of reducing CO2 emissions by 30 percent over the entire life cycle by 2025 compared with 2015 and of transforming the company into a CO2-neutral balance sheet company by 2050. The individual brands have developed corresponding roadmaps for this purpose, which contain comprehensive decarbonization measures. The pillars of the decarbonization program are the reduction, conversion and compensation of unavoidable emissions. Volkswagen can use life cycle assessments (LCA) to record the hot spots in the value chain. This quantifies the CO2 emissions generated in the supply chain, in-house production, use phase and recycling. The Hot Spot Analysis identifies those areas that have a large share of the CO2 footprint or a large potential for CO2 savings.  

Clean ID.3 production
Blueprint Zwickau: The ID.31 has been rolling off the production line at the Volkswagen plant in Saxony since November 4, 2019. The facility will be converted into the largest, most efficient and environmentally friendly electric car production plant in Europe. One of the main focuses will be on reducing CO2 emissions. This is achieved, among other things, by consuming green electricity from Volkswagen Kraftwerk GmbH. This company offers pure natural electricity from hydroelectric power plants, wind farms and solar parks. This alone reduces CO2 emissions by 106,000 tons per year.

In addition, the Zwickau location relies on energy efficiency measures for new buildings in order to minimize the consumption of electricity, water and heat. This reduces the plant’s electricity consumption by 20 percent. Another energy efficiency measure is thermal post-combustion in the paint shop, which uses less gas. In addition, there are frequency-controlled fans and pumps as well as the use of energy-optimized compressed air systems.

New power stations in Wolfsburg
Take Wolfsburg, for example: at its production site in Lower Saxony, the Volkswagen Group is leading the way in phasing out coal. The two power stations will be completely converted from coal to natural gas for around 400 million euros. With a 33 percent increase in energy efficiency, the CO2 emissions of the two power plants will be reduced by around 1.5 million tons per year.

This corresponds to the annual CO2 emissions of currently approx. 870,000 vehicles and is a decrease of almost 60 percent compared to the previous emissions of the power plants at the Wolfsburg location. The modernization will reduce the CO2 emissions of Volkswagen AG’s production sites (Brunswick, Emden, Hanover, Kassel, Salzgitter, Wolfsburg) by around 50 percent and for the Group’s production sites worldwide by around 15 percent. Water consumption, waste generation and other emissions will also be drastically reduced – by an average of around 50 percent. By 2025, the CO2 emissions of all plants are to be reduced by half compared with 2010. Audi’s production facilities in Brussels, for example, are already completely CO2-neutral.

Climate-friendly batteries from Poland
Take Poland, for example: an electric car can only be CO2-neutral in its balance sheet, as the upstream and downstream supply chain processes. Significant CO2 improvements are achieved above all in the production of battery cells, one of the key positions in the supply chain. Production is very energy intensive.
For the production of the ID. and the Audi e-tron2, Volkswagen has therefore agreed with the supplier LG Chem that only certified green electricity will be used in battery production at the site in Poland. This significantly reduces CO2 emissions: in battery production to almost zero, for the entire production process by up to 80 percent. These measures are a relevant contribution to making the ID. and the Audi e-tron more sustainable and thus even more attractive.

Climate Neutral Data Center in Norway
Example Norway: There, the Volkswagen Group moved into a new, climate-neutral data center in Rjukan, near Oslo, operated 100 percent on hydroelectric power. Together with the Norwegian partner Green Mountain, the site was set up in just six months. Green computing power, sustainably and energy-saving cooled by the Norwegian climate. These halls are supplied with up to 2,750 kilowatts of power, which can save more than 5,800 tons of CO2 per year compared to a conventionally operated data center.
The Volkswagen and Audi brands will use the data center for high-performance servers on which they process computing-intensive vehicle development projects. These include the simulation of crash tests and virtual wind tunnel tests. The Volkswagen Group already operates a climate-neutral data center in Iceland (Reykjanesbær). This location saves around 6,200 tons of CO2 annually.

Climate protection project, in Indonesia, to offset unavoidable CO2 emissions
Example Indonesia: Volkswagen wants to reduce CO2 emissions uniformly and over the entire life cycle of a vehicle. But not all CO2 emissions can be avoided in advance. For this reason, Volkswagen Group has decided to offset the currently unavoidable CO2 emissions from the supply chain, the manufacture and delivery of the new Volkswagen ID.3 electric vehicle and other emissions from other areas, so that the ID.3 can be handed over to customers in a balance sheet CO2-neutral manner.
The Volkswagen Group initially intends to support climate protection projects in forestry and renewable energies. For example, the Volkswagen Group is financially involved in the world’s largest forestry project to offset global CO2 emissions, the Kantigan Mentaya project, in Indonesia. The project is located in central Kalimantan on the island of Borneo and secures a 149,800-hectare forest on carbon-rich peat soils against deforestation and conversion into economically used plantation areas. These areas extract CO2 from the atmosphere, bind the carbon they contain and produce oxygen. Above all, the peat sponge, which is widespread in this region, retains an above-average amount of carbon.

CO2 compensation
In its efforts to offset CO2 emissions, Volkswagen is focusing on forestry conservation projects such as the Kantigan-Mentaya project in Indonesia. Important: The principle of compensation works globally. It is therefore not decisive where greenhouse gases are emitted or avoided. The CO2 reductions achieved through climate protection projects are measured in CO2 credits. One CO2 credit corresponds to one ton of CO2 avoided. The buyers of CO2 credits offset their CO2 emissions with the CO2 credits. The CO2 credits are then cancelled and not reused.

Importance of quality certificates for CO2 emissions
In its commitment to climate protection projects, the Volkswagen Group ensures that established and recognized methods are used to quantify the CO2 impact. In this way, it can be shown that every gram of CO2 could actually be offset exclusively by the climate protection project supported by Volkswagen. These include the Gold Standard, the Verified Carbon Standard (VCS) and Community and Biodiversity Standards (CCBS), which must be met at the same time.

The project works closely with surrounding village communities to improve their living conditions and contribute to local sustainable development – including direct employment in the forest fire response teams, the provision of microfinance credits and support in the areas of education and health. The project also protects a habitat of high conservation value and a vibrant mix of species.

Further CO2 avoidance and compensation projects in the planning stages
From the clean production of the ID.3 to the forestry project in Borneo – further projects to avoid, reduce and offset CO2 emissions currently occurring in the Volkswagen Group’s value chain are already being planned. Volkswagen is thus taking the first steps towards balance sheet CO2 neutrality in 2050, in order to achieve the goals of the Paris Climate Agreement.

Source: VW Corporate
Date: Dec 4, 2019