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Energy & Carbon

In Carlsberg Malaysia Group, the Senior Supply Chain Director and management team oversees implementation of the ZERO Carbon Footprint sustainability roadmap. In line with the Carlsberg Group’s goals, our Malaysia operations have set annual targets based on the Group’s ambition of ZERO carbon emissions at our brewery in Shah Alam, Selangor.

Our iconic Shah Alam brewery entered its 48th year since commissioning. We are committed to constant reinvestments to meet demand while reducing carbon footprint impact including optimising equipment and operations, ongoing product innovation, research and development (R&D) and increasing efficiencies within our capacity.


Targets

Carlsberg Group’s aim is to achieve ZERO carbon emissions at all breweries by 2030 with a 30% reduction in “beer-in-hand” emissions by 2030.

Its next milestone in 2022 includes a 50% reduction in emissions and a switch to 100% renewable electricity, plus eliminating coal as an energy source. The Group also aims to reduce our beer-in-hand carbon footprint by 15%, have 100% low-impact cooling, and to establish 30 global partnerships with suppliers by 2022, leading to a reduction of our shared carbon footprint.

In line with these ambitions, Carlsberg Malaysia Group targets a 5% reduction in thermal and electricity usage year-on-year and a complete replacement of R22 – a high-climate-impact refrigerant gas – by 2022 in stages.

Our focus remains on energy efficiency in brewing, an area we directly control and maintain within our ISO 14001:2015 certification. The biggest challenge we face to meet the Carlsberg Group’s ambitions is on renewable electricity, as the only available source of electricity is from the local grid which relies mostly on fossil fuels.

We continue to work with our partners on a long-term basis to address carbon-reducing measures in packaging, raw materials, logistics, and outlet operations (e.g. low-impact refrigeration).

Thermal Energy

In 2019, brewing operations used 21.70 kilowatt hours of thermal energy per hectolitre (kWh/hl) versus 23.17 kWh/hl in 2018. This represents a reduction of 8.7%, exceeding the year-on-year reduction target of 5%.

In our efforts to prioritise renewable energy sources, natural gas usage decreased to 17.21 kWh/hl compared to 18.86 kWh/hl in 2018, while biogas usage increased to 4.49 kWh/hl versus 4.31 kWh/hl in the previous year. This raises the ratio of biogas to natural gas usage within our thermal energy mix to 20.7% from 18.6% previously.

The improvements for thermal energy were due to continued progress in the hot insulation improvement project covering all hot surfaces such as piping and boiler stations. Carrying on from the previous year, the installation of an online flue gas monitoring system led to better boiler efficiency control.

Operational efficiency also improved thermal performance with a proper shutdown procedure implemented when bringing the production online or offline, with a reduction in heat consumption during line idling or non-production times.

A further measure was to optimise bottle-washer efficiency, all while meeting or exceeding the hygiene and product quality standards overseen by the in-house Quality Assurance laboratory.

In line with year-on-year targets, we aim to reduce total thermal energy usage to 19.70 kWh/hl by 2022.

Electricity

Total electricity usage for 2019 saw marginal efficiency improvements, clocking in 9.98 kWh/hl versus 10.07 kWh/hl in 2018. However, electricity usage for production alone, which does not include consumption within our administrative and sales operations regional offices, remained the same at 9.23 kWh/hl compared to the last fiscal year.

The main challenge towards reducing electricity consumption within our brewery operations was from our cooling plant where a scheduled replacement of an aging condenser unit was delayed, and the expected energy savings from this optimisation exercise was not realised within the fiscal year.

Globally, the Carlsberg Group’s goal is 100% electricity usage from renewable sources in all breweries. As the Shah Alam brewery relies on the local electricity provider (the sole source for Peninsular Malaysia) for its grid supply, our electricity provenance still depends on the power generation mix of said provider which still relies on a large percentage of non-renewable sources for the foreseeable future.

Feasibility studies have been conducted from proposals submitted from third-party vendors of solar power generation, spurred by government incentives for green technology. Initial estimates based on the placement of solar panels on existing structures indicate only potential single-digit offsets of our current electricity usage which is insufficient to drive long-term transformation.

Therefore, our current priority remains reducing energy wastage while increasing efficiency for both our brewing and operational electricity requirements, which include capital expenditure (CAPEX) investments in more efficient equipment and power-saving measures.

Reduce, Reuse, Recycle & Rethink (4Rs) Programme

We continued to encourage the reuse of packaging materials – which represents the highest contributor to our beer-in-hand carbon footprint – via the ongoing system of returnable glass bottles kegs and crates via an incentive scheme supported by our distributors and on-trade customers. In 2019, our collection rate of returnable glass bottles surpassed our target.

Carlsberg Malaysia Group is the first Carlsberg market in the world to pioneer the use of a new wax emulsion coating on its refillable glass bottles which helps to double its lifetime. The coating reduces scuffing which extends the bottles’ longevity, allowing them to look new and scratch-free for longer, reducing bottles taken out of circulation for recycling. Only 40mg of concentrate is used per bottle, meaning 60kg of concentrate can treat 1.5 million bottles.

The success of this innovation has been emulated in other Carlsberg markets as part of the Carlsberg brand’s new identity campaign, which delivered practical and environmental “betterments”. The Carlsberg brand is also going greener with its switch to Cradle to Cradle Certified™ silver ink that is produced using renewable energy across its bottle labels. The ink helps improve the recyclability of the labels. Working together with packaging vendors, we also introduced thinner-gauge walls for our recyclable aluminium cans since 2016 without compromising on structural integrity.