by Laura Feinstein and Eric de Place
Rating the Climate Claims and Actions of Albertsons Amazon, Boeing, Costco, Intel, Microsoft, Nike, Nordstrom, PACCAR and Starbucks
This article was first published at sightline.org. https://www.sightline.org/2020/09/21/how-cascadian-corporations-stack-up-on-climate/
Last month in Part I, the article gave an overview of the environmental aspirations (relating to climate) of Northwest-based Fortune 500 companies.
Albertsons, a major U.S. grocer that owns Safeway and Haggen, has not made transformational climate commitments nor joined any of the major initiatives that we surveyed combatting climate change. Like Costco, the company has on-site solar generation prominently featured in its corporate sustainability report, although it amounts to less than one-half of one percent of its annual energy use. Albertsons has no published emissions reduction or renewable energy targets. While proactive on deploying money-saving energy efficiency upgrades in its stores, the company seems to be primarily following consumer interest in climate-friendly behavior, which has thus far been insufficient to spark meaningful change beyond trying to burnish its reputation. Amazon Amazon is launching a $2 billion climate fund to pursue investments in clean energy and technologies to combat climate change. And, Amazon CEO Jeff Bezos is donating another $10 billion of his personal fortune to fight climate change. In addition to other admirable pursuits like powering Amazon with 100 percent clean energy by 2025 and becoming net zero by 2040, Amazon announced it is ordering 100,000 electric delivery vehicles (so that 50 percent of all shipments will use net zero carbon in their fulfillment, packaging, and transportation by 2030).
The company has also named the Seattle’s new professional hockey venue, “Climate Pledge Arena.” Unlike its peers who have signed onto third-party-led climate initiatives, Amazon is home-growing its own climate initiative, filling a space where other accepted programs already exist. Still, the company has had four other corporations join its pledge: Infosys, Mercedes Benz, Reckitt Benckiser, and Verizon.
Yet for all these positive actions, Amazon works against the climate as well. The company has very diverse business arms — cloud computing, online retailing, and grocery delivery just to name a few — including some highly carbon-intensive components. Most prominent is its global logistics network that depends heavily on fossil fuels for air and ground transportation, along with energy-intense server farms across the world.
Amazon generates around 50 million metric tons of carbon annually, comparable to the carbon footprint of entire countries like Switzerland or Norway. Worse, its artificial intelligence technology is used by oil and gas companies to improve drilling prospects, improving their profitability. Donations from Amazon have gone to climate-science-denying organizations. And, Amazon has threatened to fire employees who have been vocal about Amazon’s contribution to climate change. On that score, Amazon’s employees deserve a round of applause for pushing the company toward faster climate action.
Boeing sells airplanes around the globe, so its business success is linked to international protocols governing climate. The most prominent of these in the aviation sector is the United Nation’s market-based measurement system called Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) that has so far been adopted by 78 countries. In order to remain competitive, Boeing now engineers aircraft that meet the CORSIA fuel efficiency standards, which aim to halt carbon emission growth in aviation starting in 2020 and halve carbon emissions by 2050.
CORSIA’s 2050 goal would be achieved, in a large part, by using alternative jet fuels with a smaller carbon footprint, especially biofuels. Boeing has already experimented with these biofuels, flying around 1,600 miles in partnership with Alaska Air, and has shown that they are technologically viable. Commercializing these biofuels will prove to be a bigger challenge because of the difficulty of harvesting, processing, and distributing biofuels, not to mention making them cost-competitive with fossil fuels.
Internal to the company’s operations, Boeing set five environmental goals in 2018. By 2025, the company aims to: reduce greenhouse gas emissions by 25 percent, reduce water consumption by 20 percent, reduce waste to landfill by 20 percent, reduce energy consumption by 10 percent, and reduce hazardous waste by 5 percent. Many of these are a tall order.
According to its most recent scorecard, Boeing actually increased water consumption and hazardous waste production. It may also need to accelerate progress on greenhouse gas emissions and energy goals, both of which improved in 2018 — but neither of which appears to be on track. Boeing’s internal goals may appear less aggressive compared to peers in our evaluation who have found pathways to become carbon neutral, have zero-waste facilities, or have reduced energy use in their facilities by 20 percent or more.
Costco, a multinational warehouse store, has not made transformational climate commitments, nor joined any of the major initiatives combatting climate change that we surveyed. The main efforts cited in its sustainability report address reducing energy intensity in its operations through efficiency projects, like switching to LED lighting and implementing energy management systems.
Costco’s corporate website mentions a focus on land stewardship, forestry, packaging, transportation, human rights, agriculture, and fisheries, although there are few specifics. Costco boasts about some renewable energy projects on its website, but these supply less than two percent of its annual energy consumption. Costco’s biggest identified risk related to climate change in its 2019 CDP disclosure is whether extreme weather will prevent customers from shopping.
Intel, a leading semiconductor manufacturer, identified goals for clean energy, emissions, and energy efficiency. It is sourcing 100 percent renewable energy for its U.S. and European Union operations, which works out to 71 percent of its global energy demand. Intel was aiming to improve its notebook and server products’ energy efficiency by 25 times beyond 2010 levels by 2020, but it fell short, achieving instead a 14-times improvement for notebooks and an 8.5-times improvement for servers.
From 2018 to 2019, Intel reduced the intensity of its Scope 1 and 2 greenhouse gas emissions by 13 percent — that is, it reduced emissions per unit of production — but its absolute emissions still increased by 8 percent because the company was producing more than ever. Intel’s story is actually a common one: companies are becoming more energy- (and carbon-) efficient but manufacturing more, which expands its overall carbon footprint. Perhaps it is for this reason that Intel is fighting Oregon’s new rules that would drive down emissions by participating in a lawsuit targeting Oregon Governor Brown’s executive order that caps greenhouse gas emissions.
Microsoft leads the Northwest in meaningful climate commitments as well as goals accomplished: the company is already carbon neutral and uses 100 percent renewable energy in its business, accomplished in part by buying carbon-free electricity on the open market instead of the carbon-rich electricity offered by Puget Sound Energy. In January 2020, Microsoft pledged go carbon negative — removing more carbon from the atmosphere than it puts in by 2030. And, to take it a step further, by 2050, Microsoft aims to erase its historical carbon footprint since the company’s founding in 1975. Like Amazon, Microsoft is backing its pledge with a major investment: $1 billion toward decarbonization strategies that will help it and other emitters remove carbon from the atmosphere.
However, Microsoft does earn a demerit. Like Amazon, the software giant continues to form and maintain business partnerships with the oil and gas sector. In fact, Microsoft announced new deals in 2019 with Chevron and Schlumberger for cloud computer services. The company says it can work with the fossil fuel sector to help it “evolve.”
Nike claims to be motivated by the future of sports (because temperature changes may affect the duration of playing seasons, clothing options, and safety), and so the company has identified several initiatives to combat climate change. In fact, Nike has joined most of the major climate change initiatives we surveyed and has an active focus on climate But even with Nike’s highly publicized positions on sustainability, Nike is working against climate progress. The company sits on the executive committee of the industry group currently suing to stop the Oregon Governor Brown’s executive order mandating steep emissions reductions in Oregon. Despite its earlier support for Oregon’s failed cap and trade legislation, Nike’s role in this lawsuit cannot be ignored.
The company is making some baby steps in the right direction, however. Like the leaders on our list, Nike committed to sourcing 100 percent renewable energy for the facilities it owns and operates facilities by 2025. Yet, facility management is not really Nike’s core carbon problem. More than 90 percent of the firm’s carbon footprint is attributable to its global supply chain, which Nike does not own and operate, and which is not included in its renewable energy pledge. In 2016, Nike signed onto the Paris Climate Agreement, and, in doing so, has committed to reducing carbon emissions in its global supply chain by 30 percent by 2030, with a vision (but not a commitment) to achieve net zero emissions by 2050.
Nike is also participating in the Better Buildings Challenge, with a goal to reduce energy use by 20 percent from 2015 levels by 2025 on its 10.8 million square feet of U.S.-based buildings. But, with so much of its carbon emissions in its supply chain, the company’s pledges feel lackluster until they extend beyond the Nike-owned footprint.
Nordstrom, a luxury department store chain in North America, announced in April 2020 (the 50th anniversary of Earth Day) that the company would be setting a science-based target for reducing Scope 1, 2, and 3 emissions. Details about this target are still forthcoming, but Nordstrom is already offsetting 100 percent of its emissions from its 13 Western Washington stores using Forterra’s Evergreen Carbon Capture Program.
In 2018, Nordstrom stores had improved energy efficiency by 17.1 percent over a 2014 baseline. By the conclusion of this year, Nordstrom aims to buy 30 percent of its total energy from renewable sources. In 2019, Nordstrom also joined the G7 Fashion Pact, in which signatories committed to greenhouse gas emission reductions, renewable energy, single-use plastic elimination, and other eco-goals.
PACCAR, a semitruck manufacturer, has made no formal climate commitments nor joined any of the major initiatives combatting climate change that we surveyed. Nonetheless, the truck manufacturer has notched a few meaningful environmental achievements and it is pursuing product designs that indicate it is taking some responsibility for climate change.
The challenge goes right to the heart of its business because PACCAR’s products run on fossil fuels. Demand for electric trucks is growing, however, and PACCAR is prototyping several zero-emission trucks to meet emerging requirements across the globe (although none are yet commercially available). It also joined the U.S. Department of Energy’s Supertruck II initiative to improve the efficiency of 18-wheelers, the trucks that haul 80 percent of goods in the United States, and, in doing so, use about 28 billion gallons of fuel per year. But it could go much further.
By comparison, PACCAR’s major competitor, Daimler (maker of Freightliner, Western Star and Mercedes-Benz trucks), has pledged to make its entire commercial fleet carbon neutral by 2039.
Internal to the company’s operations, PACCAR spent $160 million in the past 10 years on energy efficiency, as well as reducing emissions, water use, and waste. PACCAR has also sliced its greenhouse gas emissions by 29 percent on a per revenue basis between 2009 and 2018, although its actual emissions have increased overall as its revenue has grown. One positive sign is that 88 percent of its manufacturing locations achieve zero waste to landfills.
Starbucks announced in January 2020 that it was “striving” to become resource positive — that is, storing more carbon than it emits, eliminating garbage, and providing more water than it withdraws. The coffee giant has also made some hard commitments, include cutting carbon emissions by half for its direct operations and supply chain, replacing half of the water used for coffee production and operations, and eliminating half of its landfill-bound waste, all by 2030. For its 50th anniversary in 2021, Starbucks plans to formalize its goals and plan.
In 2018, Starbucks announced its plan to operate 10,000 LEED-certified stores, in conjunction with its pledge to reduce by 25 percent the energy intensity of 12 million square feet of stores in 70 countries by 2025. The company made progress. By the end of 2019, all U.S., Canadian and U.K. stores ran on renewable energy and 72 percent of its global operations were powered by renewable energy. In fact, Starbucks will be powering all global operations with renewable energy by the end of 2020.
Yet, for all its leadership on climate change, Starbucks has also been a leader in creating the to-go, disposable culture that pervades today. Previous efforts to meet a 2015 goal to reduce waste by encouraging a quarter of customers to use reusable cups fell drastically short, proving that getting consumers on board is a major hurdle to the success of goals like these. To achieve significant emissions reductions, consumers would also need to start opting for plant-based milks to lighten their java; dairy makes up 21 percent of Starbucks’ carbon footprint.
There can be little doubt that the U.S. federal government has failed to address climate change in a meaningful way. Although the national policy response has been especially horrendous under the Trump Administration, it was never adequate under President Obama, and there is good reason for skepticism about the prospects for climate progress in a Biden administration. Still, as discouraging as the federal government’s failure may be, it is possible to find reasons for cautious optimism in climate action at other scales, including city and state leadership, and increasingly, in corporate America.
It is heartening then that some of these giants, like Microsoft and Amazon, have emerged as leaders willing to bankroll — and stake their reputation on — reversing the environmental damage where they have been contributors. Many others, like Costco and Albertsons, clearly have much more to do, but they may yet be responsive to customers who demand more meaningful action than the PR campaigns that may have worked in the past.
Laura Feinstein focuses on energy policy, particularly natural gas infrastructure and energy decarbonization. She recently researched and wrote about innovative approaches to limiting natural gas pipeline expansion. Before joining Sightline, Feinstein worked as an engineer for Puget Sound Energy, modernizing the regional energy grid. She has a bachelor’s degree from Purdue University in electrical engineering and a master’s from the University of Washington in mathematics.
Eric de Place, director of Thin Green Line, spearheads Sightline’s work on energy policy. Known as a leading expert on coal, oil, and gas export plans in the Pacific Northwest, he is considered an authority on a range of issues connected to fossil fuel transport, including carbon emissions, local pollution, transportation system impacts, rail policy, and economics. He has a master’s degree in philosophy from the University of Notre Dame. Find his latest research here, email him at email@example.com.