Climate Resilience and Energy

SCG elaborated on its mission and business purposes under the ‘Passion for Inclusive Green Growth,’ highlighting four main drivers: ‘Agile Organization – Green Innovations – Organization of Possibilities – Inclusive Society.’ The aim is to create a Net Zero society that grows sustainably. This initiative represents an evolution from SCG’s ESG 4 Plus strategy (Net Zero – Go Green – Reduce Inequality – Enhance Collaboration Plus Trust through Transparency), aiming to strengthen and amplify SCG’s resilience amidst global volatility, including geopolitical conflicts and the climate crisis, which significantly impact the economy, society, the environment, and overall quality of life.

SCG has demonstrated its commitment to take climate action. In the latest development, SCG joins the

SCG has established both short-term and long-term greenhouse gas emission reduction targets in accordance with the Paris Agreement to limit global temperature rise to no more than 1.5 degrees Celsius by 2050. In 2021, SCG joined the Science Based Target initiative (SBTi), which certifies organizations’ targets according to scientific calculation standards. In 2023, SCG received SBTi certification for its near-term targets to reduce GHG Scope 1 and 2 emissions by 25% by 2030 compared to the base year of 2020 and decrease GHG Scope 3 emissions from fossil fuel sales to external customers by at least 25% by 2031, compared to the base year of 2021.

While the SBTi certification marks a significant milestone in SCG’s journey toward building a green society, numerous challenges remain as success requires cooperation across all sectors, including government agencies, private organizations, and civil society, both at national and global levels, such as the Federation of Thai Industries, the World Business Council for Sustainable Development (WBCSD), the UN Global Compact Network Thailand (UNGCNT), and the Thailand Business Council for Sustainable Development (TBCSD), with the goal of joining forces to accelerate Thailand’s transition to a low-carbon society while leaving no one behind.

Near Term Target has been validated by SBTi.

SCG commits to reduce absolute scope 1 and 2 GHG emissions 25% by 2030 from a 2020 base year*. SCG also commits to reduce absolute scope 3 GHG emissions from the use of sold fossil fuels 25% by 2031 from 2021 base year.

*The target boundary includes biogenic emissions and removals from bioenergy feedstocks.

These new and more ambitious targets challenge SCG to step up innovation and adoption of energy transition technology, in tandem with collaboration with supplier to reduce GHG scope 3.

SCG GHG Roadmap Towards 2050

Task Force on Climate-related Financial Disclosures (TCFD)

Climate change issue is one of top 3 of SCG materiality. SCG has integrated TCFD into business strategy since 2019. SCG has reviewed TCFD elements across existing structures and performances, such as governance structure, sustainable development strategy, risk management and target related KPI. SCG also identifies, assesses and manages climate-related risks.

Governance

SCG has integrated climate change and related issues, including TCDF, in SCG managing structures from top management to operations business; The Board of Directors, President & CEO, SCG Sustainable Development Committee (SDC), SCG Climate Change & Energy Committee, SCG Risk Management Committee, and business units.

Board will decide the company direction including overall climate change strategy and cascade to management team leading by President & CEO
President & CEO leads ambition all business units to net zero by setting short term, medium term and long term plan to align with Paris Agreement and countries’ Nationally Determined Contributions (NDC). President & CEO supports investments and economic instruments; Internal Carbon Pricing (ICP) to encourage environmental investment projects.
SCG SDC provides global trends, ESG, SD framework, networking, such as WBCSD, UNGC, Ellen MacArthur Foundation, GCCA and monitoring all SCG performances related to climate change & TCFD.
SCG Climate Change & Energy Committee is responsible to climate change and energy issues, set up climate strategy, net zero pathway, transition risk, physical risk and adaptation plan, R&D GHG reduction, collaborating with global and local networks for new technologies such as CCU/S, Energy storage, Hydrogen energy sources.
SCG Risk Management Committee creates risk culture, risk scenario which potential impacts to SCG.

Strategy

SCG conducted scenario analysis embed in strategic business planning which is in line with enterprise risk management framework to assess materiality of climate-related risks and opportunities in term of both business and externality impacts. SCG Climate Change and Energy Committee is responsible to set up and propose to president & CEO and board of directors. SCG foresees both climate-related risks and opportunities over the near term (2030), medium term (2040) and long term (2050).

Growth in renewable energy.
Reduction in fossil fuel consumption.
Improve or modify process and equipment to enhance energy efficiency.
Increased market demand for low-carbon products.
Research and development (R&D) of technology to accelerate GHG mitigation, Carbon Capture, Utilization and Storage to achieve Net Zero in 2050.
Restoration of terrestrial and marine ecosystems as carbon sinks.
Awareness raising on energy conservation and climate resilience among employees and contractors.
Implement Internal Carbon Pricing (ICP) at 25 USD/ton CO2 for investment, which reduce GHG scope 1 and 2.
Changes in policies, rules, regulations, and requirement to expedite decarbonization.

SCG has set up process to identify, assess both transition risks and physical risks. SCG can see the risks and opportunities,

Risks such as regulation change, trade barrier, water flooding, water scarcity, customer’s environmental needs, and stakeholder expectations.
Opportunities such as new green technologies, new low carbon products such as low clinker cement content, new low carbon investments and businesses such as solar, biomass power plant, energy storage.

Risk Management

SCG has implement process to identify, assess and manage climate-related issues; physical risks, transition risks and adaptation plan as existing, medium term and long term. SCG has risk assessment system to all operation sites to evaluate all risks including climate change such as water flooding, water scarcity. This system is required to review at least quarterly or any significant changes.

Metrics and Targets

SCG has disclosed GHG scope 1&2 and 3 emissions annually in SCG Sustainability Report and on SCG website.

Target

Net Zero GHG Emission by 2050 (scope 1&2)
By 2030, reduce GHG scope 1 and 2 emissions by 25% from 2020 base year.
By 2031, reduce GHG scope 3 emissions from the use of sold fossil fuels by 25% from 2021 base year.
By 2025, reduce Energy Consumption by 13% compared with business as usual (BAU) from the base year of 2007.

2024 Performance (Metric)

• GHG Scope 1&2 emissions reduction by 25.59% compared with the base year of 2020
• GHG Scope 3 emissions from the use of sold fossil fuels by 20.66% compared with the base year of 2021
• Energy consumption reduction by 7.91% compared with BAU from the base year of 2007
• Portion of Alternative Fuels by 28.59%

Green Logistics

SCGJWD have Green Strategy for logistics sustainability towards customer, community and transportation contractors. We apply as core principle Backhaul Logistics Operation to manage rounds of freight trucks, and reducing running on empty trip, while using Multi-Modal logistics to manage big lot haulage to improve efficiency.

SCGJWD commits Net Zero by 2050. Green Logistics Program for GHG Reduction, such as

EV Truck: Replaced diesel truck with EV truck, reduce fossil fuel for transportation by 20,000 liters per month or 210,000 liters per year
EV Forklift and Automated Storage Retrieval System (ASRS): Replaced diesel forklift with EV Forklift and using technology for products storage automatically
Fleet Utilization Management Program: All transportation vehicles are equipped with GPS and use a software system to calculate transportation routes. To get the most effective distance and reduce fossil fuel in transportation.
Solar Rooftop: use electricity from renewable energy in the warehouse to reduce GHG emissions

https://www.scgjwd.com/en/sustainability/environment/energy-management