Response to Climate Change
Policy on climate change
The impact of climate change is a serious problem thatthreatens the stability of society and the environment globally for generations to come. The Sumitomo Corporation Group, which operates a wide range of businesses around the world, also considers it as a risk that requires particular attention. The Group has recently revised its climate change policy in view of the situation worldwide.
Currently, initiatives toward the achievement of the climate change mitigation targets set by the Paris Agreement are being implemented, but there are many issues to address. As a member of the global society, the Sumitomo Corporation Group is committed to making ongoing contributions across the range of its business activities to overcoming these issues and addressing the problem of climate change to pass on to future generations a sustainable society.
Basic policyThe Sumitomo Corporation Group contributes through its business activities to resolving the climate change issues and to realizing a carbon-neutral society for the sustainable development of society.
Policy for business activities
- We aggressively promote the followings: 1) renewable energy business, 2) advanced energy management business, 3) the development of business models/innovations that contribute to the reduction of energy consumption, and 4) other businesses that contribute to mitigating or adapting to climate change. In addition, we put our effort on controlling greenhouse gas emissions associated with our business activities.
- In the power generation business, we provide a stable supply of the energy, essential for the economic and industrial development of local communities. At the same time, we continuously shift management resources to renewables and other energy sources with low environmental burden in the power generation portfolio.
(By the target year of 2035, we aim to shift the composition of the portfolio in terms of net ownership generation capacity as follows: coal 50% 30%; gas 30% 40%; and renewables 20% 30%)
- We will not have new development in the coal-fired power generation business. However, we make a decision individually about new development in cases where the project is essential to the economic and industrial development of the local community and where the project is complying with the policies of the Japanese and host country governments based on the international initiatives to mitigate climate change issues. (*)
- In the thermal coal mining business, we limit our equity share coal production to our current levels, and desist from new minedevelopment projects.
- The Van Phong coal-fired power generation project in Vietnam is a project based on this policy.
Enhanced disclosure of information on climate change-related risks and opportunities
Recognizing the importance of corporate information disclosure on climate change, in March 2019 Sumitomo Corporation indicated its support for the final recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). Going forward, we will address the issue of further improving information disclosure in line with the framework recommended by the TCFD.
In connection with climate change issues, a close watch is kept on relevant developments including international initiatives as well as trends among financial institutions. The impact on the Group’s business activities is reported periodically to our Board of Directors. Although we currently judge that there is no risk of climate change issues having a serious impact on the Group’s management, we will remain vigilant for changes in the business environment, capturing the various associated business opportunities and continuing to contribute through our businesses to resolving the issues.
Contributing through business activities to addressing climate change issues
Through initiatives on various fronts, the Sumitomo Corporation Group will continue contributingto addressing the many issues related to climate change mitigation and the realization of a carbon-neutral society.
In the power generation business, in addition to supplying renewable energy in a variety of forms including wind and solar power, we are also working to realize disruptive innovation through new technologies such as carbon capture and storage (CCS) (*1) and CO2-free hydrogen production. To achieve reliable stability in electric power systems, which is a great challenge for the wider use of renewable energy, we are progressing with the commercialization of new energy management technologies using storage batteriesand a wide range of other electric power sources as well as IoT-based virtual power plants (VPPs). (*2)
- Technologies to isolate and store CO2 by burying it underground or under the seabed
- An IoT-based technology initiative integrating dispersed storage batteries and other energy sources to balance electric powersupply and demand by controlling power storage and release