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- Ingka Group commits €1.5 billion to eliminate direct fossil fuel use.
- Targets an 85% reduction in climate footprint from own operations by 2030 (2016 baseline).
- Investment focuses on energy efficiency and renewable heating and cooling technologies.
Ingka Group, the largest IKEA retailer, is investing €1.5 billion to accelerate its transition away from fossil fuels. This move contributes to the company’s goal of reducing its climate footprint from its own operations by 85% by 2030, compared to a 2016 baseline.
“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 on- and offsite renewable energy production to enable the transition. We have already 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 good for business – a win-win,” said Jesper Brodin, CEO, Ingka Group.
The investment will accelerate efforts to retrofit IKEA units with energy efficiency upgrades and renewable heating and cooling systems. All new units will be built with renewable heating and cooling, and work is already underway to retrofit 150 existing properties.
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“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,” stated Karen Pflug, Chief Sustainability Officer, Ingka Group.
This commitment adds to the already pledged €7.5 billion, with over €4 billion invested by Ingka Investments in off-site renewable energy, positioning the company as a mid-sized renewable energy producer.
“As businesses, we have an important role to play 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. Now, 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 added.
Ingka Group urges governments to:
- Rapidly scale up renewable energy through targets and incentives while phasing out fossil fuels and related subsidies.
- Invest in grid infrastructure suitable for distributed renewable generation and electrification needs.
- Enforce stronger energy efficiency regulations across sectors.
- Simplify permitting processes for renewable energy projects and infrastructure, respecting a just transition, local communities, and environmental standards.
- Encourage and incentivize the renovation and retrofitting of buildings, including insulation, heating/cooling, and energy storage.
Note: Ingka Group’s total climate footprint covers greenhouse gas emissions across its operations (scope 1 and 2) and its upstream and downstream value chain (scope 3). The 24.3% overall reduction from FY16 to FY23 was achieved against a 30.9% increase in revenue.
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