Our climate footprint throughout the IKEA value chain
To successfully contribute to limiting climate change to 1.5°C and achieve our overall goal of becoming climate positive by 2030, our climate footprint must be addressed throughout our entire business. Our aim is to achieve this by using more sustainable materials and food ingredients, taking steps towards 100% renewable energy in our buildings, transports and in production, and enabling healthy and sustainable living for our customers.
The climate footprint of the IKEA value chain continued to decrease during FY20 and we saw big improvements across the value chain such as increased energy efficiency in the lighting and appliances ranges, more plant-based food and more renewable energy in production and transport. The climate footprint per euro retail sales decreased by 7% between FY19 and FY20. The loss of sales and the lockdown of stores during FY20, makes the absolute reduction of our footprint with last year difficult to compare.
Climate footprint from materials
(45% of the total IKEA value chain climate footprint in FY20)
The largest portion of the IKEA climate footprint can be attributed to raw materials extraction and processing. Our aim for FY30 is to only use renewable or recycled materials. While wood is our most-used material, metals have a higher climate footprint since they are more energy-intensive to produce and rely on the use of coal. In FY20, we increased the share of recycled polyester in textile products and reached 83% (up from 59% in FY19).
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from food ingredients
(3% of the total IKEA value chain climate footprint in FY20)
In FY20, IKEA restaurants and other food service touchpoints operated at reduced capacity. The loss in sales resulted in a large reduction of the climate footprint and the goal for FY30 was reached. The climate footprint of food was reduced by 25.6% in terms of kg CO2 eq per kg food ingredient. IKEA restaurants and other food service touchpoints have often been the first areas to close and the last to reopen as stores have modified their operations throughout the pandemic. Outside of reduced sales, the improvement per kg of food ingredient has mainly been achieved through a steady reduction in the volume of beef and pork sold in relation to other food ingredients (from 11% in FY19 to 9% in FY20), as well as reduced menus during the pandemic. While the absolute goal for FY30 was already met in FY20, the main challenge is to maintain or exceed this level towards FY30 as sales increase.
We’re making healthy, more sustainable food a reality for the many
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from production
(12% of the total IKEA value chain climate footprint in FY20)
Production covers the manufacturing of IKEA home furnishing, food products and the components in our products. In FY20, the climate footprint for the production of IKEA products decreased in absolute terms by 15.5% compared to baseline FY16. Our goal is to reduce the absolute greenhouse gas emissions from production by 80% compared to FY16 by 2030. One furniture supplier, Vilniaus Baldai, in Lithuania, has already reached the goal in FY20. By turning wood waste from production into a source for renewable energy, Vilniaus Baldai is not only self-sufficient in renewable energy, but is also able to sell their excess heating to the city of Vilnius’ district heating, enabling more renewable energy for the many people.
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from product transport
(5% of the total IKEA value chain climate footprint in FY20)
Our total transported goods dropped considerably in FY20, due to the COVID-19 pandemic (8.2% less in FY20 compared to FY16), while having increased by 1.2% between FY16 and FY19. We aim to increase the use of renewable fuels in order to continue reducing the greenhouse gas emissions from our transports. IKEA will be one of the first to use liquefied biogas in heavy duty transportation in Italy, starting from March 2021. The liquefied biogas is produced from manure and will cover 32% of domestic transport flows. Fueling stations will be located in Trivento, Italy, where most of our Italian suppliers are located. This result will deliver an estimated reduction of 24% absolute greenhouse gas emissions. By 2030, we aim to reduce our absolute greenhouse gas emissions from product transport by 15% compared to 2017.
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from IKEA retail and other operations
(3% of the total IKEA value chain climate footprint in FY20)
The absolute climate footprint from our retail and other operations has increased 10.9% since FY16. The main reason for the increase of the climate footprint since FY16 is an increasing expansion in the number of stores and a rapid expansion of customer fulfilment units following the omnichannel transformation, especially in countries where it is difficult to access renewable energy. On a positive note, during FY20 we added IKEA Retail in Iceland and the Baltics to our list of countries which consume 100% renewable electricity. We aim to consume 100% renewable electricity in retail and other operations by 2025. In FY20 we globally consumed 77% renewable electricity in all IKEA operations* (including production in our own IKEA factories). Our goal for 2030 is to reduce the absolute greenhouse gas emissions from retail and other operations by 80% compared to 2016.
*Scope: Inter IKEA Group and the IKEA retail business of Ingka Group (scope 1 & 2)
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from customer travel and home deliveries
(6% of the total IKEA value chain climate footprint in FY20)
In FY20, the climate footprint from customer travel and home deliveries decreased significantly mainly as a result of reduced store visitation due to COVID-19. Currently, 32 markets are committed to providing access to electric vehicle (EV) charging stations in all stores by the end of 2020.* In FY20, these markets added around 1,000 new electric charging stations for customers, offering charging stations at 93% of the stores. The current forecast is that we will manage to reach our goal of 100% by the end of 2020.* Our goal for 2025 is for 100% of transport for customer deliveries and services to use electric vehicles (EV) or other zero-emission solutions. By 2030 our goal is to reduce the greenhouse gas emissions from customer travel and home deliveries by 50% in relative terms per person compared to 2016.
*Results will be presented in Sustainability Report 2021
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from product use at home
(22% of the total IKEA value chain climate footprint in FY20)
Being people and planet positive means making sustainable choices available for the many. Our MATMÄSSIG hob was reduced in size, while maintaining its original cooking zone size and is offered at a lower price. It’s a great choice in households where the electricity does not allow for enough power for a full size induction hob – making induction technology accessible to more people than ever. By significantly improving the energy efficiency of our lighting and appliances ranges, we have since FY16 reduced our climate footprint by 26.7% in absolute terms.
Climate footprint (million tonnes CO2 equivalent)
Climate footprint from product end-of-life
(4% of the total IKEA value chain climate footprint in FY20)
As we transition into a circular business where waste is turned into resources through recycling, instead of being incinerated or ending up in landfills, we will continue to reduce the climate footprint from product end-of-life. However, the first step is prevention. We will encourage reuse and work with refurbishment and remanufacturing to ensure that products can last as long as possible and will only be sent to recycling as a last step. Ultimately, our goal is to eliminate the product end-of-life footprint by becoming 100% circular by FY30.
Climate footprint (million tonnes CO2 equivalent)