Glencore, in a move mirroring its earlier climate strategy but now imbued with a definitive target, has announced a bold plan to slash emissions by 25% by 2030. This decision, as per CEO Gary Nagle, arises from a diverse array of influences, including shifting market dynamics, emerging regulations, insights from peer companies, and the latest data from the International Energy Agency (IEA) and the United Nations Framework Convention on Climate Change (UNFCCC).
The company’s initial climate action plans in 2020 aligned with the broader Paris Agreement objective of containing temperature rise under 1.5 degrees Celsius. However, Glencore, headquartered in Baar, Switzerland, drew criticism for its active role in thermal coal extraction, straying from the eco-conscious discourse.
In response to mounting pressure from stakeholders and investors, Glencore has committed to phasing out coal mines by the mid-2040s and shuttering at least 12 mines by 2035. Nagle emphasized the distinction between thermal coal and steelmaking coal, hinting at diverse transition strategies for each.
Glencore’s stance remains resolute on responsibly scaling down its coal assets. Importantly, the firm has taken a firm stance against initiating any new thermal coal ventures, focusing instead on essential commodities for the transition to cleaner technologies.
Notably, the company’s decarbonization trajectory is deeply influenced by global politics, policy innovations, and technological breakthroughs, shaping the pace and direction of its sustainability efforts.
Addressing Scope 3 Emissions
In a visionary move, Glencore aims to curtail “Scope 3” emissions — arising from the downstream use of its raw materials — by 30% by 2035 and ultimately achieve net zero Scope 3 emissions by 2050, showcasing a resolute commitment to a greener future.
Interestingly, Glencore has excluded its marketing operations from these targets, contending that trading third-party volumes does not contribute to additional Scope 3 emissions. This is a deliberate move, considering that third-party emissions typically hinge on the transformation or use of products by external entities.
Adding to its environmental aspirations, Glencore’s recent acquisition of a 77% stake in Teck’s steelmaking coal business, Elk Valley Resources (EVR), underpins its determined transition towards sustainability. The deal, contingent on regulatory nods, is slated for closure no later than Q3 2024, marking another milestone in Glencore’s green journey.
