Fonterra’s Decarbonisation Ambition


Fonterra has announced a lift in its decarbonisation ambition with a new scope one and two emissions reduction target, which will be achieved by bringing forward some of its work to get out of coal.

 Fonterra CEO Miles Hurrell said the Co-op was targeting a 50 percent absolute reduction in scope one and two emissions in 2030 from a 2018 baseline, an increase on its previous 30 percent reduction by 2030.

“Fonterra’s scope one and two emissions largely come from our manufacturing operations and supply chain. Strengthening our emissions reduction target supports our ambition to be net zero by 2050,” said Hurrell. 

Achieving the new target will require Fonterra to continue to undertake energy efficiency improvements and fuel switching to renewable energy source activities across its milk collection fleet and manufacturing sites, with a focus on the six where it uses coal.

To do this, Fonterra is forecasting an investment of $790 million, including a government contribution of up to $90 million through the Government Investment in Decarbonising Industry (GIDI) fund.

"As a Co-op, Fonterra understands how we can achieve more by working together. The addition of Government funding enables us to lift our 2030 ambition to reduce scope one and two emissions by 50 percent and optimise our process to get out of coal by 2037.” 

 Hurrell continued that the decarbonisation plan would see Fonterra explore multiple technologies to ensure the most efficient coal phase-out and transition to renewable energy across our manufacturing sites while building resilience into our operations.

Fonterra is well underway with shifting its manufacturing operations to renewable energy sources. Over the past five years, Fonterra has carried out decarbonisation projects at five different sites and was looking forward to continuing this momentum.

Currently, Fonterra is assessing biomass, electrification, and heat pump technology at its Clandeboye and Edendale sites, with these technologies being considered the best solutions possible at this stage of the business.

 “Accelerating our plans will help Fonterra continue to present our customers with the world’s lowest carbon dairy at scale. It will also contribute to New Zealand meeting its climate targets while delivering benefits across regional New Zealand, such as job opportunities in local communities.” 

The Co-op is talking with farmers about a scope three emissions target, which will be announced shortly.

Fonterra’s climate targets are aligned with the Science Based Target initiative, which means they’re aligned to limiting global warming to 1.5 degrees. The process of seeking accreditation is underway.