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Boehringer Ingelheim‘s projects to reduce its carbon footprint

WEC-Roundtable – Augsburg – October 24-25, 2007 „Corporate Strategies in Response to Climate Change“. Boehringer Ingelheim‘s projects to reduce its carbon footprint. Dr. H. Leidig, BI GmbH WEC-Roundtable. 1. Augsburg, Oct 24-25, 2007.

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Boehringer Ingelheim‘s projects to reduce its carbon footprint

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  1. WEC-Roundtable – Augsburg – October 24-25, 2007„Corporate Strategies in Response to Climate Change“ Boehringer Ingelheim‘s projects to reduce its carbon footprint Dr. H. Leidig, BI GmbH WEC-Roundtable Dr. H. Leidig, BI GmbH WEC-Roundtable 1 Augsburg, Oct 24-25, 2007

  2. BI’s projects to reduce its carbon footprintIs it a new topic? – Not really! • 2 comics from 1979 • “Mickey Mouse and Goofy explore energy” • “Mickey Mouse and Goofy explore energy conservation” Dr. H. Leidig, BI GmbH WEC-Roundtable

  3. BI’s projects to reduce its carbon footprintIs it a new topic? – Not really! • Giveaway of ‘Chicago Tribune’ from 1980 • 16-pages comic on energy conservation and energy savings Dr. H. Leidig, BI GmbH WEC-Roundtable

  4. BI’s projects to reduce its carbon footprintBoehringer Ingelheim in brief • Focus on Human Pharmaceuticals and Animal Health • Founded in Ingelheim, Germany, in 1885 • Products marketed in some 150 countries • More than 38,400 employees (2006) • Net sales of almost EUR 10.6 billion (2006) • # 15 worldwide in terms of net sales (as of March 2007) • Family-owned Dr. H. Leidig, BI GmbH WEC-Roundtable

  5. BI’s projects to reduce its carbon footprintBoehringer Ingelheim’s caring culture • We have been committed to Corporate Social Responsibility for over a century. • Our caring culture embraces a broad range of activities for: • our employees and their families • our neighbours • our society • our natural environment • www.boehringer-ingelheim.com/wecare Dr. H. Leidig, BI GmbH WEC-Roundtable

  6. BI’s projects to reduce its carbon footprintEnergy efficiency is on everyone’s lips • EU-Directive 2006/32/EC on energy end-use efficiency and energy services (Apr 2006)Minimum energy savings Target: 9% within 9 years (starting point: 01.01.2008) • Energy Policy Act (USA, 2005) andNational Action Plan for Energy Efficiency (NAPEE, USA 2006) • 1st German ‘National Energy Efficiency Action Plan’ (EEAP, Oct 2007) • Energy savings 9% until 2017 • Detailed catalogue of measures • Gleneagles Plan of Action: Transforming the way we use energy (G8 Summit, Gleneagles 2005) International Energy Agency (IEA) 1. Report (2007): “Energy efficiency requirements in building codes – energy efficiency policies for new buildings” Dr. H. Leidig, BI GmbH WEC-Roundtable

  7. BI’s projects to reduce its carbon footprintDriving energy efficiency through policy • Research and Development create new technologies • R&D partnerships with industries • Standards set the floor • Codes and standards (buildings, equipment, vehicles) • Energy efficiency performance standards for utilities • Incentives make them viable • Market transformers (tax incentives, project (co)financing, trade-in programs with e.g. emissions credits) • Public education makes them widespread • Cosumer education and awareness campaigns • Labeling (e.g. US-Energy Star) Dr. H. Leidig, BI GmbH WEC-Roundtable

  8. BI’s projects to reduce its carbon footprintWhy energy efficiency? • Wide range of untapped energy efficiency potentials“Stop wasting energy (= money)!” • Mitigation of pollution and climate change“Negawatt/Negajoule produces no environmental (carbon) footprint!” • Increase of energy security position“Energy efficiency is a “homegrown” resource!” Dr. H. Leidig, BI GmbH WEC-Roundtable

  9. BI’s projects to reduce its carbon footprintManagement-oriented barriers to energy efficiency • “Energy efficiency is one of many topics that are competing for industry’s time, resources, and leadership. Energy efficiency may be more effectively promoted not by itself, but as part of a larger agenda that is more likely to get executive attention” • Frequent barriers: • Lack of common understanding • Lack of staff & management awareness • Lack of procedural coordination • Absence of energy-related accountabilities • Inconsistent Leadership • Lack of resources • Company’s business culture Dr. H. Leidig, BI GmbH WEC-Roundtable

  10. BI’s projects to reduce its carbon footprintWhat is needed for industrial energy efficiency? • For a company to achieve a high level of energy efficiency, to maintain it, and continuously improve it: • The company needs an organizational culture that supports continuous improvement • The company’s management must develop methods to “hardwire” energy-efficiency into existing management practices • Energy efficiency becomes a “key performance indicator” for managers and workers Dr. H. Leidig, BI GmbH WEC-Roundtable

  11. BI’s projects to reduce its carbon footprintHow BI is reducing its carbon footprint? • Energy consumption & Performance indicators • Energy efficiency projects • Substitution of fossil fuels by secondary fuels • Use of renewable energy Dr. H. Leidig, BI GmbH WEC-Roundtable

  12. BI’s projects to reduce its carbon footprintBI Energy consumption Dr. H. Leidig, BI GmbH WEC-Roundtable

  13. BI’s projects to reduce its carbon footprintMain BI energy consumers Dr. H. Leidig, BI GmbH WEC-Roundtable

  14. BI’s projects to reduce its carbon footprintBI Energy consumption index Dr. H. Leidig, BI GmbH WEC-Roundtable

  15. BI’s projects to reduce its carbon footprintEnvironmental Key Performance Indicator • Environmental KPI shall be used for target-setting & performance evaluation. Therefore: composite indicators are not useful • Many environmental figures (water consumption, COD-load, VOC-, SO2-, NOx-emissions, hazardous/domestic waste amount) are hardly useful as KPIs • Energy consumption seems to be the only significant KPI – not only for Operations but also for other organizational BI-units • More efficient use of energy is a “hot” political & social issue and directly linked to CO2-reduction/climate protection • Rising energy costs make energy consumption a more important economic factor for BI • Absolute energy consumption cannot be an useful KPI –specific indicators for all organizational areas have to be developed Dr. H. Leidig, BI GmbH WEC-Roundtable

  16. BI’s projects to reduce its carbon footprintEnergy efficiency indicators (EEI) “Those things that get measured and reported get attention and resources” Dr. H. Leidig, BI GmbH WEC-Roundtable

  17. BI’s projects to reduce its carbon footprintEnergy efficiency projects • “Buildings are the largest end use of energy”(OECD: Residential & commercial buildings account for 35%) • Adequate wall & roof insulation/ Awindow thermal performance/shading devices • Efficient HVAC systems (heat recovery) B • Thermal energy storage (cold water) C • Intelligent control systems for ventilation D(No of air changes) & lighting by e.g. motion/presence sensors • Trigeneration (Absorption chillers) E Change of “paradigm” in capital expenditure management More emphasis on life cycle costs instead of initial investment cost Dr. H. Leidig, BI GmbH WEC-Roundtable

  18. BI’s projects to reduce its carbon footprintSubstitution of fossil fuels I Waste wood power plant at Ingelheim site Acting in sense of environmental policies i.e. use of renewable energies Substitution of 70,000 t/a CO² of fossil origin Substitution of hard coal by used wood (biomass ordinance) Lower emissions e.g. Reduction of: Dust: 95% SO2: 95% NOx: 50% Increase of energy security & economics Dr. H. Leidig, BI GmbH WEC-Roundtable

  19. BI’s projects to reduce its carbon footprintSubstitution of fossil fuels II • Investment for conversion of power plant: 12,5 Mill € • Start-up of “waste-wood”-boiler: Sept. 2004 • Fuel consumption: 70.000 t/a waste wood • Delivery of waste wood by trucks • Diesel consumption for truck transportation equals to 600 t waste wood/year (i.e. < 1% of waste wood deliveries) • Surplus of emission certificates due to substitution of fossil fuels • Further conversion of power plant planned (secondary fuels instead of heating oil) Dr. H. Leidig, BI GmbH WEC-Roundtable

  20. BI’s projects to reduce its carbon footprintUse of renewable energies • Geothermal energyUse for heating/cooling of buildings Fvia heat pumps and thermal activation of constructional elements • Summer season: Reduction of room temperature: appr. 5°C • Winter season: Generation of 35 – 40% of room heating energy • PhotovoltaicsPilot installations in Ingelheim & BiberachCurrently not economical However: solar energy is the energy of the future! Dr. H. Leidig, BI GmbH WEC-Roundtable

  21. BI’s projects to reduce its carbon footprintEnergy management Energy management is of increasing importance as part of overall facility management! • Energy consumption measured online and Genergy data processing in central data base • Energy management is part of online Hecobalance system Dr. H. Leidig, BI GmbH WEC-Roundtable

  22. BI’s projects to reduce its carbon footprintEmission trading in Germany • National allocation plan I (2005-2007) Germany: 495 Mill tons CO2/a • National allocation plan II (2008-2012) Germany: 453 Mill tons CO2/ai.e. reduced allocation of emission certificates – mainly for power plants • Emission trading at BI • Surplus of certificates due to waste wood power plant sold in 2005 and 2006 • Prices for CO2-certificates went down from 25 – 30 €/t CO2 in 1st quarter 2006 to less than 1 €/t CO2 at the end of 2006and remained there in 2007 • No certificates traded in 2007 • Emission trading does not function properly as supply and demand of certificates are not balanced Dr. H. Leidig, BI GmbH WEC-Roundtable

  23. BI’s projects to reduce its carbon footprintThe Carbon Neutral Challenge • To be carbon neutral is a real challenge and currently hardly to achieve for corporations! • Voluntary compensation activities: • “Planting trees” • “Buying green power” • HOWEVER:It has the flavour of “eco shrove-money” and I“sale of indulgences” Dr. H. Leidig, BI GmbH WEC-Roundtable

  24. Thank you for your attention! Questions & Comments Dr. H. Leidig, BI GmbH WEC-Roundtable Dr. H. Leidig, BI GmbH WEC-Roundtable 24 Augsburg, Oct 24-25, 2007

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