Valeo has announced that by 2050 it will have achieved carbon neutrality for all of its own operating activities and across its entire supply chain worldwide and it will be 100% carbon neutral (including the end use of its products) in Europe.
The company added that its emissions by 2030 will have decreased by 45% across its entire value chain—including from its suppliers, its own operating activities, and the end-use of its products—compared with 2019. It has also signed on to the “Business Ambition for 1.5°C” campaign that brings together companies committed to achieving carbon neutrality by 2050 using the strict framework of the Science Based Targets initiative.
Emphasizing the importance of Valeo’s green efforts, from this year the company will take into account CO2 emissions reduction and sustainable development criteria when determining the variable compensation of more than 1500 senior executives.
“The entire automotive industry is investing heavily to combat global warming,” said Valeo’s Chairman and Chief Executive Officer Jacques Aschenbroich. “At Valeo, the reduction of CO2 emissions has been central to our strategy since 2010, and sales generated from technologies that help to reduce CO2 emissions have grown 20-fold to around €10 billion in 2021. We intend to continue our efforts, with the aim of achieving carbon neutrality by 2050 and reaching nearly half of this objective by 2030.”
The new initiative reflects its comprehensive sustainable development (environmental, social, and governance) approach recently recognized in recent rankings. In January, Corporate Knights ranked Valeo as the most sustainable company in the automotive sector, among the world’s 100 most sustainable listed corporations. In 2020, Valeo was also the highest-rated automotive supplier by non-financial rating agencies MSCI (AAA), CDP (A), Sustainalytics, and SAM (76/100). The Group also maintained its leadership position in the Dow Jones Sustainability World index for the fifth year in a row.
On the journey to carbon neutrality, by that 2030 milestone, Valeo is committed to reducing emissions related to its operating activities by 75%, from 1.1 million to 0.3 million t of CO2 (Scopes 1 and 2). Emissions related to its supply chain will be reduced by 15%, from 9.5 million to 8.1 million t of CO2 (upstream Scope 3).
According to the Carbon Trust, Scope 1 covers direct emissions from owned or controlled sources. Scope 2 covers indirect emissions from the generation of purchased electricity, steam, heating, and cooling consumed by the reporting company. Scope 3 includes all other indirect emissions that occur in a company’s value chain.
Emissions related to the biggest source, the end use of its products (Scope 3 downstream), will also be reduced by 15%, from 39 million to 33.1 million t of CO2. This reduction is expected to rise to 50% when taking into account emissions avoided thanks to the Group’s electrification technologies, with CO2 emissions declining from 39 million to 19.5 million t.
The company has many vehicle electrification solutions in its portfolio.
Among the low- and medium-voltage technologies is the 48-V “engine,” which allows the electrification of the powertrain, and is suitable for electric or rechargeable hybrid models. The competitive price of the technology offers a solution that can quickly increase the use of electrified vehicles.
For higher power electrification solutions of more than 60 V for electric and plug-in hybrid vehicles, in addition to the electric engine itself, the Valeo Siemens eAutomotive joint venture produces components that can fully integrate propulsion systems such as an on-board charger for the battery, a DC/DC converter, and an inverter to control the engine.
A recent example extending its auto electrification efforts to outside the industry includes its adaptation of 48-V motors to bikes, resulting in what it says is the most high-performance electric assistance system for bikes to date, combining performance, efficiency, intelligence, comfort, robustness, and ease of use. (Check out https://futurride.com/2020/12/26/valeo-revolutionizes-e-bike-drivetrains/.)
The company also focuses heavily on thermal management solutions for EV batteries. Controlling the temperature of the batteries, as well as creating heating and air conditioning systems with low energy consumption, are part of its range of solutions to help democratize automotive electrification.
By that 2030 milestone, the company will have invested more than €400 million in reducing emissions related to its operating activities (Scopes 1 and 2). These investments will be used to upgrade the Group’s sites to enable the current 100 most carbon-intensive facilities to become high-energy efficiency sites by 2030. Upgrades will include the development of eco-friendly buildings, the widespread use of LED lighting, and the integration of heat-recovery systems.
The proportion of low-carbon energy in the Group’s energy consumption will increase from 5.5% in 2019 to 50% by 2025 and 80% by 2030. A number of sites are already piloting renewable energy alternatives, including three Group sites in Chennai (India), where 90% of the consumption is wind-powered, and sites in Sanand (India) and Bad Rodach (Germany), which use their own solar energy facilities to produce 30% and 20% of the energy they consume, respectively. Valeo has also set the same CO2 emissions reduction objectives for its suppliers, and the use of low-emission materials will be increased.
Valeo says it will continue to expand its portfolio of technologies that contribute to low-carbon mobility, in particular its leading solutions for vehicle electrification. Over the past 10 years, the company has invested more than €10 billion in technologies that reduce CO2 emissions.
In 2019, 57% of Valeo’s sales were generated by technologies that help to reduce CO2 emissions. Today, one in three vehicles worldwide is fitted with Valeo technology that helps to reduce CO2 emissions. Valeo has also pursued an ambitious sustainable development policy, reducing its water, energy, and packaging consumption by 46%, 29%, and 32%, respectively.
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