Neste: sustainability refined

What are the most defining features of modern life?

If you said ‘cars’ and ‘plastics’, you are correct. Alternatively, you could have just said ‘oil’, since the common link between cars and plastics is petroleum.

But the problem with oil is that it produces potent greenhouse gases when we burn it in cars and power plants. And it leads to a global pollution problem once we manufacture it into short-lived plastic products.

Weaning off fossil fuels as much as humanly possible, and making our remaining oil reliance more sustainable, is at the heart of a better and more sustainable future.

The Finnish oil refining company Neste knows this very well.

They know that fuel exhaust from 1.3 billion road vehicles in use today is responsible for a quarter of global CO2 emissions.

And they know that the world produces around 360 million metric tons of plastic annually (45kg or 99lb per person), but recycle only 14% of it.

Neste knows the math.

And, as a result, they are actively trying to improve the odds by making better fuels for cars and innovating plastic recycling.

This is how Peter Vanacker, the company’s CEO, summarized Neste’s strategy:

“Our new strategy is called ‘Faster, Bolder and Together’ and our aim is to become a global leader in renewable and circular solutions. This reflects the understanding that there is no time to lose in combating the climate crisis.

In order to succeed, we need to act, innovate new solutions and deliver them faster and bolder than ever before.”

But to talk about what makes Neste so sustainable, we need to look at biofuels first.

If you’re already familiar with biofuels, just skip ahead.

Biofuels are mostly made from plants.

The idea is that biofuels are renewable because burning them only releases as much CO2 into the atmosphere as the biofuel crops had absorbed during their growth. Plus, they burn more cleanly than fossil fuels.

Traditionally, the two main types of biofuels are bioethanol and biodiesel. The first comes from sugars in plants. The second from fats, such as vegetable oils (and animal fats too).

Back when biofuels became commercially viable, people hoped they would clean up transport.

The EU, for instance, began subsidizing biofuels in the mid-2000s, and countries began to plant crops in earnest. Between 2004 and 2018 – in a mere 15 years – the proportion of renewable fuel sources in EU transport increased more than five-fold.

Except, it turns out, conventional biofuels aren’t that clean.

Biofuel producers either have to clear forests to make room for biofuel cropland. Or they need to divert food stocks from existing farmland. This forces farmers to make up for the loss and clear more land for additional production.

Either way, making room for new agricultural land is bad for the environment, because felling trees and tilling soil releases CO2 into the atmosphere.

The EU soon realised that when you factor in these indirect land-use emissions, traditional biofuels begin to look much less attractive. Biodiesel from palm oil, for instance, becomes 3 times worse for the climate than regular diesel.

So, as science caught up with biofuels, Neste decided to make a big bet on ‘advanced biofuels’.

Advanced biofuels don’t use freshly grown crops. Instead, they use plant and animal waste products. Think of cooking oil that would otherwise have been thrown away. Or corn stover (leaves, stalks, and corn cobs) that are left behind after harvesting.

Because there isn’t any new land use associated with these advanced biofuels, their total lifecycle carbon footprint is much lower than that of conventional biofuels or fossil fuels.

Theoretically, turning all the sustainably available wastes and residues in the EU into advanced biofuels could supply 16% of all EU road transport fuel in 2030.

Needless to say, the potential in advanced biofuel is great and it’s growing.

And so, Neste’s bet paid handsomely. The company now earns half its profits from renewable biofuels and more than tripled its value in the past five years.

Knowing the trends of the biofuel market, it’s no surprise that Neste plans to source 100% of its total renewable raw material inputs from waste and residues by 2025.

Using 10 different sustainably-produced raw materials each year, Neste is already 80% of the way to achieving that target.

And during the interim period until 2025, the company ensures that their remaining 20% raw material input comes from a transparent value chain.

For instance, by the end of 2019, Neste mapped out 99% of its PFAD sourcing.

(Palm fatty acid distillate, or PFAD, is a by-product of palm oil production.) If you’d like, you can explore their sourcing through this traceability dashboard.

As for plastics, Neste is exploring avenues in chemical processing. This makes a lot of sense given how so many plastics are difficult or impossible to recycle mechanically.

To be more specific, Neste set a goal of processing more than 1 million metric tons of liquefied waste plastics by 2030.

But there are, of course, other factors that explain why Neste earned third place for two years in a row on Corporate Knights’ Global 100 list of the world’s most sustainable companies.

Neste is working to reduce the emissions of its customers by 20 million metric tons of CO2 equivalent by 2030.

The company’s sustainability report shows that their renewable fuels for road transport, shipping and aviation, as well as their plastic products, have already taken them to the halfway mark (9.6Mt).

To reduce their own operational footprint, Neste entered into a long-term agreement with an energy company to procure enough wind energy to cover 20% of the electricity use at two of their Finnish sites.

The company has made a commitment to the efficiency program for Finland’s energy-intensive industries; invested in a combined heat and power (CHP) generator for one of their plants; plus they’ve conducted feasibility studies for excess heat recovery at two of their manufacturing facilities.

When you take full stock, it becomes clear that the Finnish company truly dares to care about sustainability.

2020-07-20T15:31:33+00:00July 14th, 2020|Dare to Care, Inspiration, Work|

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