Thailand signed the agreement in Conference of the Parties: COP 21 at Paris, pledging to reduce GHG emission according to Intended Nationally Determined Contributions (INDCs) in all sectors by 20-25% within 2030. This is in in addition to GHG reduction according to Thailand Nationally Appropriate Mitigation Action (Thailand NAMAs) in the energy sector and transportation sector by 7-20%, compares to the business as usual level as of 2010. PTT has responded to the national target by focusing on GHG management, by driving forth GHG emission management under the corporate-wide governance of the Sustainability Alignment Committee’s (SAC). This will be achieved via excellent technological management and prioritization of the environment, comprises:
1. Development of green products: Through research works and development of alternative energy, PPT produces, procures, and distributes products that reduce GHG emissions, such as gasohol, bio-diesel fuels, composite LPG gas tanks, and biodegradable plastic in products such as Amazon Coffee cups;
2. Green process management to increase energy efficiency: Improve efficiency of energy consumption, and become more environmentally friendly, with a focus in effectively manage GHG emissions within the organization;
3. Building green public awareness: Foster the awareness from within PTT Group, to suppliers, customers and the general public. This was achieved by raising public awareness in environmental conservation, with an emphasis in cultivating a sustainable society through various GHG reduction initiatives, such as reforestation and social development activities.
Furthermore, greenhouse management at the level of operation site will be governed by the PTT Group QSHE Policy Committee, ensuring that the performance of all PTT Group companies is in alignment.
Additionally, PTT also conducts researches and develops multiple mechanisms for carbon dioxide storage and offsets. PTT collaborates with the public and private sector in supporting activities and policies related to climate change
PTT Climate Change management is consistent with sustainable development approach, as well as approaches and standards practiced internationally. The process is as follows.
1. Account for and Understanding Impact: Collect data collection and calculation PTT Group’s GHG emission, while maintaining alignment with PTT Group GHG Accounting and Reporting Standard. The data will be utilized for work efficiency improvement and distributed to related stakeholders.
2. Assessing the Global and Local Climate Change Situation: Monitor climate change situation at both the global and local scale with potential impacts to sustainability, such as different laws and regulations, GHG emission management mechanisms (i.e. carbon tax, cap and trade), other approaches and standards related to climate change at an international level (i.e. WBCSD, CDP, DJSI, GRI). This includes participation in conferences and seminars on Climate Change, hosted by the public sector, private sector, among others.
3. Identifying Climate Changes Risks and Opportunities: Identify corporate-level climate change risks and opportunities as follows:
· Risk and opportunities from regulatory change
· Risks and opportunities from climate change-induced physical changes
· Other risks and opportunities
4. Determining Actions and Setting Targets: Setting the strategy basing on the data collected on climate change, both on a global and local scale, and identifying risks and opportunities within the operations into 2 aspects:
· Mitigation Action: Work on controlling, mitigating and absorbing carbon dioxide in the atmosphere to mitigate climate change impacts
· Adaptation Action: Work on climate change adaptation to ensure sustainable business continuity.
5. Monitoring and Communicating Performance: Monitor and review progress according to strategy and work plan, including reporting progress to both internal and external stakeholders.
PTT adopts Enterprise Risk Management to analyze risks and opportunities arising from climate change by considering regulatory risk factors, consumer behavioral change, market trends, financial risks such as carbon tax, and physical risks such as the rise of sea level and extreme weather events. In addition, PTT considers and monitors reputational risk and updates mitigation measures on a monthly basis. As a result, financial impacts from reputational risk as a result of climate change are relatively low. PTT reports its assessment of risks and opportunities from climate change to the Board and stakeholders annually. Additionally, PTT identified risks and opportunities induced by climate change and regularly monitor them, due to the perceived risks and opportunities of emission reduction targeted as per communicated in Intended Nationally Determined Contributions (INDCs) for Thailand. PTT is developing 2030 target to ensure accordance with the INDC.
Climate change risk is an opportunity for an organization to develop itself in order to effectively respond to risks from climate change and shifting consumer behaviors. These factors firmly align with the vision, strategic direction of Pride and Treasure of Thailand. To date, several innovations have been presented to consumers. Innovations include alternative energy sources such as gasohol oil E20 and E85, and synthetic materials made from biomaterials which are used to develop hi-tech equipment that is lightweight, durable and environmentally-friendly, such as composite LPG gas tanks and biodegradable plastic for use in coffee cups, popcorn buckets. Furthermore innovation focuses on electricity generation from waste to energy power plant, and developing solar photovoltaic system..
For risks and opportunities arising from climate change at the operational level, PTT takes into account natural risks such as rising sea level and extreme weather events. Appropriate actions are taken to minimize the impacts of such risks. Preparation in prevention and mitigation against these risks is achieved through the implementation of Business Continuity Management System (BCMS). This system covers an emergency response plan for incidents which may occur naturally or anthropogenically. Each business unit is responsible for monitoring and ensuring business continuity on a quarterly basis.
In 2017, PTT sets a 2030 target in consistent with Thailand’s long-term national target, either in direct GHG emission (Scope 1), and indirect GHG emission (Scope 2), as follows:
||Reduce GHG emission by 15% by 2020, and by 25% by 2030,compares to the baseline year of 2012
||Improve GHG emission intensity by 5% by 2020 compares to the baseline year of 2012, and by 12% by 2020|
PTT has conducted Greenhouse Gas Accounting to track its GHG inventory, in emission, absorption and storage continuously since 2006. This mechanism tracks and reports on direct GHG emissions (Scope 1), indirect GHG emissions (Scope 2), and other indirect GHG emissions (Scope 3). GHG data is externally verified by a third party organization on an annual basis.
PTT had developed the PTT Group GHG Project Standard based on ISO-14064-2. The Standard is integrated with PTT’s GHG emission inventory and is used as the standard for PTT Group to assess and analyze GHG reduction efforts in accordance with international standards.
Direct GHG emissions (Scope 1) encompasses operational activities from combustion, carbon dioxide separation, release of hydrofluorocarbons (HFCs) and sulfur hexafluoride (SF6), fugitive emissions, vented emissions, flares, and other process emissions.
Indirect GHG emissions (Scope 2) refer to the release of GHG from the consumption of purchased energy, such as electricity, heat and steam in PTT’s business operations. PTT has an approach in GHG emission reduction, either direct GHG emission (Scope 1) or indirect GHG emission (Scope 2), by focusing on management process to increase energy efficiency, alternate fuel used, generate electricity from co-generation power plants, and utilize waste heat. These are the efforts taken to facilitate progress towards the set goals.
PTT’s other sources of indirect GHG emissions (Scope 3) include the transportation of raw materials and products, employees transportation by air, as well as combustion from products sold. In 2015, PTT planned to expand GHG accounting to cover Scope 3 emissions, namely emissions from waste treatment, to align with the PTT Group 2020 Strategic Objective of Zero Hazardous Waste-to-Landfill.
PTT’s approach for reducing other indirect GHG emissions focuses on reducing product carbon footprints through product research and development to meet market needs in correspondence with the Pride and Treasure of Thailand strategic direction and Alternative Energy Development Plan (AEDP). In addition, PTT plans to expand manufacturing of bio-fuels in order to serve the increasing demand for bio-fuel in Thailand.