One of the world’s largest furniture retailers has pledged to phase out all fossil fuels over the next six years. Ingka Group, IKEA’s largest retailer, has committed Euro 1.5 billion to green up its operations.
Targeting energy efficiency improvements and renewable heating and cooling technology, Ingka Group has pledged to reduce its climate footprint from its operations by 85% by 2030 (from a 2016 baseline) – in addition to the already committed EUR 7.5 billion investment in offsite renewable energy production and technologies.
“Ending our reliance on fossil fuels is essential to tackling the climate crisis and halving global emissions by 2030. At IKEA, we started our journey” in 2009 and have invested heavily in both onsite and offsite renewable energy production to enable the transition,” according to Jesper Brodin, CEO of the Ingka Group. “We have reduced emissions across our IKEA stores by 60.4% since 2016, and 96% of our retail sites now use renewable electricity.”
“The future of energy must be renewable, and this additional investment will enable us to reduce our carbon emissions, increase efficiency and lower costs in the long term. It’s also a win-win for business.”
Jesper Brodin, CEO of Ingka Group
Ingka Group is committed to the Paris Agreement and works towards drastically reducing GHG emissions and phasing out fossil fuels in line with its validated Science-Based Targets (SBTi). Efforts to use 100% renewable electricity across its retail operations have already contributed to Ingka Group reducing its overall emissions by 24.3%, against a 30.9% increase in revenue (FY16 baseline).
This additional investment is part of the company’s commitment to decarbonise its operations and value chain. It will accelerate ongoing efforts to retrofit IKEA units with energy efficiency upgrades and renewable heating and cooling. All new units will be built with renewable heating and cooling, and work is already underway to retrofit 150 existing properties.
“Transitioning to renewable heating and cooling is a vital enabler on our decarbonisation journey; however, it’s a complex and costly process. This investment means we can progress further and faster with our plans – and we know it will pay off in the long term”, said Karen Pflug, Chief Sustainability Officer, Ingka Group.
The investment in its own operations comes in addition to a EUR 7.5 billion commitment to offsite renewable energy production and technologies. To date, Ingka Group’s investment arm, Ingka Investments, has already invested and committed to over EUR 4 billion in offsite renewable energy, making it a mid-sized renewable energy production company.
“As businesses, we have an important role in phasing out fossil fuels, but we cannot do it alone. We welcome the COP28 pledges on renewable energy and energy efficiency and consensus on transitioning away from fossil fuels. To move from pledges to impact, governments and businesses need to combine efforts and address obstacles, such as complex and inefficient policy, permitting and reporting frameworks. We have five years left to deliver to the Paris Agreement – with the right commitment and leadership, we have it in our hands.” Jesper Brodin adds.
To enable the transformation across society, Ingka Group welcomes the following actions from governments:
- Rapidly scaling up renewable energy through targets as well as incentives and, at the same time, phasing out fossil fuel and connected subsidies.
- Investing in the required grid infrastructure fit for distributed renewable generation and the need for electrification.
- Set stronger energy efficiency regulations across sectors.
- Simplify permitting processes around renewable energy projects and infrastructure while respecting a just transition, local communities, and environmental standards.
- Encourage and incentivize the renovation and retrofitting of commercial and residential buildings, including insulation, heating/cooling, and energy storage.
