Response to Climate Change
Policies on Climate Change IssuesClimate change is a critical issue that the world must work as one to overcome in order to realize a sustainable society. Companies are being called on to play a major part in tackling this issue.
In 2020, the Board of Directors adopted a resolution concerning the Group's policies on climate change issues and clarified the Group's roles we play in solving the issues.
- Aim to make the Sumitomo Corporation Group carbon neutral in 2050(*1).
Develop technologies and business models for creating a sustainable energy cycle by reducing CO2 emissions and achieving negative emissions(*2) for society as a whole.
- In addition to reducing and absorbing CO2 emissions from our business, we will contribute to the carbon neutralization of society through cooperative initiatives and recommendations made with business partners and public institutions.
Policy on Business Activities
- Promote renewable energy, efficient energy utilization and fuel conversion that contributes to reducing CO2 emissions throughout society. We will also work to offer new energy management and mobility services utilizing renewable energy and also to materialize hydrogen technologies and applications.
- 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% to 30%; gas 30% to 40%; and renewables 20% to 30%)
- Regarding the development of thermal power generation and fossil energy concession, we will work on the premise of carbon neutralization in 2050.
- The scope of business targeted for carbon neutralization is as follows
[Scope1・2] Direct CO2 emissions from Sumitomo Corporation and its subsidiaries, as well as indirect CO2 emissions from the generation of energy used by each company (however, for power generation businesses, emissions from those affiliated companies under the equity method are also included)
[Scope3] Indirect CO2 emissions associated with the use of energy resources produced by fossil energy concession of Sumitomo Corporation Group, its subsidiaries, and affiliated companies under the equity method.
Carbon neutrality means net-zero CO2 emissions that combine CO2 emissions from our business and our contributions to CO2 emission reduction.
- Negative emission refers to the absorption, capturing, and removal of CO2 emitted in the past and accumulated in the atmosphere.
In 2019, the Company has established the following policies regarding coal-fired power generation business and thermal coal mining business. In addition, the revised policy sets carbon neutrality by 2050 and the development of coal-fired power generation and fossil energy concession will be operated to meet the goal.
- 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 mine development projects.
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