Energy and climate change
At Telefónica we want to do more with less. Our commitment can be seen in the new energy and climatic change objectives we have set, in line with the global commitment to not exceed 2ºC in temperature (2DS), according to the Paris Agreement.
Our objectives for 2015-2020 are not only compatible with the expansion of the network and quality of service, but will also help us to be more competitive:
Reduce energy consumption by 50% per unit of traffic.
Start to decouple our growth in Greenhouse Gas emissions, reducing them 30% in absolute terms sources in 2020 and 50% in 2030.
Save 90 million euros for energy efficiency projects.
Commit to renewable energies as a sustainable source for our business, using 50% of electricity from renewable sources in 2020 and 100% in 2030.
We work to have the most efficient telecommunications network in the market in terms of energy and carbon
In order to make all of this possible, Telefónica has an Energy Efficiency Programme and we are going to promote fuel reduction, the transformation of our network and the use of clean energy.
In 2017, we met our goal two years ahead of time: we reduced our energy intensity per traffic by 52% compared to 2015
In the framework of this Programme, in 2017 we conducted 171 initiatives on energy efficiency and the reduction of GHG emissions in our networks and offices, with which we managed to save 138 GWh. In this way, we avoided the emission of more than 36,972 equivalent tons of CO2.
We reduced our CO2 emissions 3% in the last year; 28% since 2015
In addition, thanks to our Renewable Energy Plan, 47% of electricity consumption comes from renewable sources, which is equivalent to the average annual consumption of 763,000 households. Thus, we have prevented 770,026 CO2 emissions into the atmosphere.
Risks and opportunities
Climate change influences our global business strategy due to its direct impact, risks and opportunities. Our energy and climate change strategy fosters value creation in the long term through effective risk management and by taking advantage of the opportunities.
Aspects of climate change that influence our business are: regulatory changes; need for increasing resiliency of our infrastructures; growing energy cost; temperature increase; or new green business opportunities, among others.
Physical and non-physical risks
Our risks associated with climate change are mainly related with physical vulnerability, more than regulatory or reputational risks, although they are also important. In geographical terms, they are concentrated in Latin America and in business level terms, in our network facilities.
The most significant risks are related to extreme weather events and, in the midterm, temperature increase. An increase in temperature could affect the energy consumption of our infrastructures for additional cooling needs, but also we could have indirect risks related with a potential increase in the energy costs, dependent on the hydroelectric power in some countries.
Our climate change adaptation strategy is made up of different plans, from business continuity facing weather disasters, as recently occurred in Peru, to energy efficiency projects and our Renewable Energy Plan. Some examples are:
- Governance structure: During 2015 Telefonica created the Global Infrastructure Center to improve the management of our facilities including energy issues.
- Renewable Energy Plan: In 2016, we established this plan with the goal of consuming 50% of electric energy from renewable sources by 2020 and 100% by 2030. As a result, in 2017, 47% of our electricity consumption is renewably sourced.
- Agenda: in 2017, Telefonica continued to participate in different energy and climate change working groups to manage the risk and opportunities around climate change. Moreover, Telefonica organized the 9th edition of the Telefonica Global Energy and Climate Change workshop in Brazil.
- Targets: New energy and carbon reductions targets until 2020 and 2030. The establishment of a carbon science based target according to the 2∞C scenario.
- Innovation: Investment and developing new Eco-Smart ICT services for adaptation and mitigation of climate change.
While we reduce the energy consumption and carbon emissions, we are reducing our operational costs. In this sense, we are able to provide ICT services at a better price than our competitors.
Deploying low carbon technology in our networks or monitoring climate conditions due to the installation of smart meters, we are able to manage climate change risks and avoid future impacts in our facilities.
Our Eco-Smart products and services based on Internet of Things (IoT), Big Data and connectivity enable our clients to reduce GHG emissions.
We also recognise the key role we can play in facing natural disasters related with climate change. Connectivity can be a lifesaver, either by means of an early alert or by contacting emergency services.
Last year we prevented 939 ktCO2 with our services, equal to 69% of our carbon footprint
Our Renewable Energy Plan includes four action areas, depending on the markets in which we operate and the regulations in force in each one: acquisition of renewable energy with a guarantee of origin, long-term power purchase agreements (PPA), shorter duration, bilateral agreements and self-generation.
47% of the electricity that Telefónica consumes on a global level is now renewable
PPAs are the preferred course of action in Latin America, with Telefónica Mexico's agreement to consume energy from the country's largest solar park, KAIXO Solar, located in the state of Chihuahua, for 20 years. This will represent 40% of its annual electricity consumption.
In 2018 the subscription of new PPAs in other markets where the regulations allow this, such as Chile, Argentina and Colombia is planned.
We are 100% renewable in Germany, Brazil, Spain and United Kingdom
Bilateral agreements are available in various countries: in this way we acquired renewable energy in Brazil, where we are the company with the largest number of buildings in the free market in energy. These are short to medium-term acquisitions, between 2 and 5 years, which provide us with a saving of more than 15 million euros a year. These types of contracts have already been signed in Chile, for 28% of its consumption, and Peru for 30%. And a new contract is being negotiated for Telefónica Panama.
Finally, in Telefónica we encourage self-generation through solar panels such as those we have installed in our business complex in Madrid, Distrito Telefónica.
We are committed to becoming 100% renewable by 2030
In Telefónica, we work in different aspects to do more with less:
- Lighting: Replacement of fluorescent lights with LED technology and installation of presence detecting sensors.
- PSF (Power Saving Features): Activation of energy saving functions during periods of low traffic in our base stations and centres.
- Cooling: Technological update of the cooling devices and the installation of free cooling facilities, especially in the base stations and centres.
- Power: Technological update for power units and substitution of poor efficiency rectifiers.
- Transformation of the Network: Shut down of old equipment, Network upgrades and location optimisation.
- Renewable self-generation: Implementation of renewable systems for self-consumption and reduction of fuel consumption.
- Others: Configuration of our network equipment to improve its efficiency.
In all of this the support from our ever innovating partners, with whom we establish innovative collaboration agreements is fundamental.
Alongside this, we continue to reduce the consumption of fossil fuels in operations and in our fleet of vehicles, replacing them with more efficient and clean sources of energy, using fuel efficient vehicles and decreasing the distance travelled thanks to an improvement in the management of the fleet.
Energy inventory and CO2
At Telefónica, we analyse our energy consumption each year and we calculate the carbon footprint globally in accordance with the Greenhouse Gas Protocol, the ISO 14064 Standard and the ITU-T L.1420 Recommendation: Methodology for energy consumption and greenhouse gas emissions impact assessment of information and communication technologies in organisations, of the International Telecommunication Union (ITU).
Every year, we carry out an independent process to check energy and emissions data in order to obtain quality information about the energy we consume and the greenhouse gases we emit into the atmosphere.
This enables us to identify improvements in the processes and to manage energy and carbon in a transparent manner. Based on this quantification and verification, we evaluate fulfilment of the global energy reduction objectives.
In 2017, the emissions of our value chain (Scope 3) decreased by 6%
Inventory of Energy and GHG Emissions:
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Climate Change and Energy Efficiency Office
Telefónica’s Climate Change and Energy Efficiency Office promotes efficient energy use in the company and identifies opportunities to reduce CO2 emissions. For their part, the Energy Managers are responsible for developing projects in the different countries. They belong to the Operations teams and work closely with this office.