Agreement marks another milestone toward commitment to decarbonize operations by 2030
With an eye toward achieving their global decarbonization goals, Danfoss North America recently signed a power purchase agreement with CIG Capital, a U.S.-based project financing firm, to purchase about 75 MW of solar power from a solar farm in Texas, starting in 2025. The initial agreement term is 12 years, allowing Danfoss to fully replace its annual electricity usage in North America with green energy through at least 2037.
The new agreement will provide Danfoss with green certificates, signifying that they are supplying the North American electrical grid with the full amount of green electricity needed to power all 24 factories and 36 locations in North America, and will reduce Danfoss’ carbon footprint in the region by 75%.
Soren Revsbech Dam, Head of ESG and Decarbonization, Global Services Real Estate, at Danfoss says: “As part of our ESG goals, Danfoss has committed to achieving carbon neutrality across our global operations by 2030. This agreement to secure green energy for our North America operations will reduce our global emissions by 21%. This is not only a significant step in our journey to becoming carbon neutral, but it also demonstrates that we are serious about putting sustainability at the heart of our business.”
CIG Capital will be building the six square mile farm in the panhandle region of Texas. Groundbreaking is scheduled for November of 2023, with the farm becoming fully operational by the spring of 2025. The solar farm capacity is projected to be 509 MW of solar power, of which Danfoss will utilize 15 percent.
The next focus for Danfoss in its decarbonization journey will be on reducing and reusing energy across its North America locations, employing various Danfoss technologies, such as oil-free, variable-speed compressors and other heating and cooling solutions that support heat recovery and energy efficiency.
Rick Sporrer, President of Danfoss North America says: “Danfoss is committed to playing a leading role in the energy transition. Meeting our ESG goals and living up to our commitment to combat climate change means developing innovative solutions.”
As part of the Science Based Targets initiative (SBTi), Danfoss is committed to become carbon neutral in its global operations (scope 1 & 2) by 2030 and says it will reduce its value chain emissions (scope 3) with 15% by 2030. This commitment is included in the targets of Danfoss’ three step-change initiatives on Decarbonization, Circularity, and Diversity, Equity & Inclusion.
Already Danfoss has seen progress in decoupling environmental impact from business growth by delivering 7% decrease in scope 1 and 2 emissions while growing 15% organically in 2022.
Additionally, the 250,000 sqm Danfoss headquarters campus site in Denmark became carbon neutral in 2022. Carbon neutrality was achieved through energy saving projects, utilization of excess heat from processes and data centers, sourcing of green energy, and offsetting residual emissions.