Environmental

To responsibly manage and reduce our impact on the environment as well as to effectively manage environmental risks to our operations 

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Growing our Renewable Energy Business

Sembcorp currently has a growing renewable energy portfolio in India, China and Singapore. The International Energy Agency expects India and China to increase renewable energy capacity rapidly, with a combined forecast growth of 475 to 600 gigawatts over the next five years. In Singapore, solar energy is considered the main viable renewable energy source. The Singapore government aims to grow installed solar capacity in the country to 350 megawatts peak by 2020.

2017 marked another year of good progress of renewables growth for Sembcorp. Our renewable energy capacity in India grew to over 1,400 megawatts with our winning of combined 500 megawatts in two nationwide wind power tenders. We also continued to expand our solar power capacity in Singapore with the addition of three projects, including new grid-tied rooftop solar energy systems at ST Aerospace’s facilities in Changi and Seletar. Within our own operations, we are taking steps to partially power our assets on Jurong Island and our Sembcorp Changi NEWater plant with solar energy by 2018. In total, we grew our global renewable energy capacity from 248 megawatts in 2012 to 2,182 megawatts in 2017. We target to double our renewables portfolio to approximately 4,000 megawatts by 2022 to become one of the region’s leading independent renewable energy players.

This demonstrates Sembcorp’s commitment to Sustainable Development Goal 7, which aims to ensure access to affordable, reliable, sustainable and modern energy for all.

Climate Change
As an energy producer, our power and steam generation activities release greenhouse gas (GHG) emissions that contribute to climate change. Events and actions by governments in response to climate change pose potential regulatory, technological, physical and reputational risks to our businesses. One such significant development was the 2015 Paris Agreement on climate change, which countries accounting for over 85% of global GHG emissions have ratified. However, we recognise that in spite of these challenges, we are also uniquely positioned to leverage opportunities that have arisen from action in response to climate change.

As part of Sembcorp’s new Climate Change Strategy, we have identified the climate-related risks and opportunities material to our Utilities business as follows:

• Changes in policy and regulation: Increasingly, governments are adapting their policies and regulations as part of country-level strategies to reduce emissions and support the transition to a low-carbon economy. The global increase of cap-and-trade schemes and carbon taxes will accelerate current trends favouring renewables, which in turn can significantly impact the future profitability of our assets and investments.

• Changes in technology and customer demand: Falling costs and improved performance of new and emerging technologies such as photovoltaic, energy storage, smart grids and downstream technologies, including electric vehicles and decentralised generation are bringing about significant changes in the energy landscape. As a result, the needs of our markets and customers will change.

• Weather disruption: Physical environmental risks, such as extreme weather events linked to climate change, may pose disruption to our assets and operations, and to the economic value chains and communities in which we operate. Exposure to physical risks vary widely across our operating geographies and across our businesses, from our power assets to our desalination plants.

• Stakeholder management and reputation: Our stakeholders are increasingly focused on the impact of climate change and how the company responds to climate-related risks and opportunities. As a responsible corporate citizen, we recognise our obligations towards our stakeholders. Maintaining our stakeholder relationships is critical to our licence to operate and essential to protect our business reputation.

Our climate change public disclosures are guided by the recommendations of the G20 Financial Stability Board’s Taskforce on Climate-related Financial Disclosures (TCFD). These recommendations were developed with the aim of providing a framework to report voluntary, consistent climate-related financial disclosures that would be useful to investors, lenders, and insurance underwriters in understanding material risks.

For more information on Sembcorp’s full Climate Change Strategy, please visit the Reports & Policies page in the Sustainability section of our website.

Local Environmental Protection
As a result of the products and services we provide, our operations have varying direct and indirect impacts on the environment such as water, land and air pollution. These include the discharge of effluent and the disposal of waste, as well as the release of NOx, SOx and particulate matter to the atmosphere. Improper or non-compliant emission, discharge or disposal not only results in harm to the environment and public health, but also threatens our long-term viability and goes against our Statement of Commitment to Environmental Protection.

Energy and Water Efficiency
Achieving optimal energy and water efficiency is a business driver for us. Maximising our efficiency and optimising our operations reduces our consumption of natural resources and impact on the environment while enhancing our returns. In the face of rising energy costs and water scarcity, energy and water efficiency are becoming increasingly critical to ensure the long-term sustainability of our business.

 

Climate Change
The management of climate change issues is led by the head of our Renewables & Environment business and executed across several departments: Group Strategy, Group Risk, Group Performance Management, Group Digital & Technology, Group Health, Safety, Security & Environment (Group HSSE), Group Strategic Communications & Sustainability and Group Human Resources & Organisational Development. We have set emission intensity targets to be in line with the scale of reductions required to keep the increase in global average temperature to below 2°C above pre-industrial levels as per projections in the International Energy Agency’s (IEA) World Energy Outlook 2016. Our target is to reduce our carbon emission intensity* from 0.55 tonnes of carbon dioxide equivalent per megawatt hour (tCO2e/MWh) in 2017 to 0.42 tCO2e/MWh by 2022 and to less than 0.40 tCO2e/MWh by 2030.
* Refers to GHG emissions intensity of our Utilities business’ assets that produce GHG from the combustion of fossil fuels 

We plan to achieve this target through two key thrusts. The first is to reduce negative impact through reducing emissions; the second is to move towards a balanced portfolio of low-carbon energy assets through growing our renewables capacity.

 

Local Environmental Protection
Group HSSE is guided by the principles and practices set out in our Statement of Commitment to Environmental Protection and Environmental Protection Management Guidelines.

We aim to comply fully with all regulations and requirements and consume resources prudently, focusing on reduction at source. We assess the impact of environmental risks and apply appropriate control measures to manage them. These cover energy efficiency, atmospheric emissions, water management, waste management, management of contaminated sites and environmental noise. We apply stringent controls in the management of waste generated by our operations, strive at all times to adhere to discharge and emission limits set by local authorities and implement containment measures to minimise any direct impact to the environment and the surrounding community. We are committed to continually reducing our waste generated. As a wastewater treatment service provider, we are able to treat multiple streams of industrial wastewater from our customers. We also have a comprehensive water sampling and testing regime that helps us ensure compliance with such standards. Our Group HSE Management System’s Incident Investigation and Reporting Requirements allow us to take systematic steps and actions in response to HSE incidents and near misses to prevent recurrence. GHSSE conducts internal audits to check for site compliance to our Group HSE management system. As part of their audit scope, GHSSE will check for each site’s non-compliance and environmental incident records and also if our contractors are licensed by the local authority to dispose of hazardous wastes.

We aim to minimise our environmental impact through prevention, reduction, reuse and recycling, and seek innovative ways to adopt a circular economy approach to waste. We actively develop capabilities to recover energy from waste. For example, at our Sembcorp Woodchip Boiler Plant in Singapore, woodchips processed from waste wood collected by our solid waste management operations are used to produce steam. Also, we use treated effluent from our wastewater treatment facilities as feedwater to produce demineralised water at our water reclamation facilities. In addition, our design and construction business utilises fly ash, a by-product of coal combustion in power plants, as a material to produce blended cement, mosaic tiles and hollow blocks.

We conduct environmental assessments in accordance with national and / or international standards and methodologies. These include environmental and social impact assessments, environmental baseline studies and pollution control studies. Recommendations from these assessments form part of our management of HSE risks and these recommendations are incorporated into the planning, designing, construction and operation of new plants.

Energy and Water Efficiency
Where viable, we invest in the latest technologies and utilise our capabilities as an industry leader to achieve better energy and water efficiency, including the reduction of heat rate and auxiliary power in our power plants, and the reduction of water consumption through water reuse. Energy and water efficiency parameters are embedded in our plant operation management systems and are monitored daily. These parameters are reported to management on a monthly basis where deviation and performance gaps are reviewed and improvement plans are discussed for implementation. Our Group Digital and Technology team spearheads various innovations and initiatives to improve operational efficiency. The team collaborates with institutes of higher learning, research institutes as well as private sector players to explore solutions which enhance our energy and water efficiency. For example, we are looking into identifying suitable waste heat recovery solutions to be applied to our operations. We also utilise the Sembcorp Global Asset Management System, a data and predictive analytics tool, to help us optimise our operations and improve efficiency.

Water availability
We leverage Sembcorp’s total water management capabilities for better efficiency and resource conservation for our own operations as well as our customers. By integrating wastewater treatment, water reclamation and water supply into a “closed loop”, we aim to minimise liquid discharge, reducing environmental impact while conserving water resources.

Our energy-efficient large scale integrated power and desalination plants use multi-stage flash distillation and reverse osmosis to provide high-quality water to industries and households in water-scarce areas such as Oman and the UAE. We do not draw groundwater for our power generation operations, but rely on seawater to meet our cooling water needs. In some of our power plants, we employ closed-loop cooling water systems to further minimise water drawn from the ocean.

Our energy and water efficiency efforts also apply to our office and administrative buildings and we actively seek to reduce our consumption of energy and water through responsible use and equipment upgrades.

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