IKEA Group, known for their bright blue and yellow mega-stores, and for getting families across the world building their own Billy book-shelves is now getting into the energy business. The company has committed to generate renewable energy to match 100% of the energy it uses by 2020.
They’re investing US$1.9 billion in their own power generation equipment, including offsite wind turbines, and onsite solar panels.
Going straight for the 100% target isn’t for the faint-hearted. But IKEA Group is convinced this is no time for half-measures. “Some may find going all-in a little bit scary at first, but the scale of the challenges facing society demands bold action,” says Peter Agnefjäll, the President and CEO of IKEA Group. “When we decided to go 100% renewable, we didn’t really know how to do that, but we had a bold objective … The role of leaders is to set visionary targets; together we will figure it out.”
Renewable energy also protects them from fluctuating energy prices, so the switch to renewables will save them money in the long term.
A catalogue of renewable initiatives
In the 2014, IKEA Group produced renewable energy equivalent to 42% of the energy it used in its stores, distribution centres and factories. Here’s how.
By the end of their 2014 financial year, IKEA Group had a total of 700,000 solar panels installed on their buildings. They’re one of the top five solar-generating companies in the US, with PV installations in 20 states and at 90% of their sites there. And their new 1 MW solar system on a store roof in Australia is the largest of its kind in the country.
In the 2014 financial year, IKEA Group committed to owning and operating 224 wind turbines around the world – up from 137 in their 2013 financial year. They now have committed to own and operate 314 turbines.
Their new wind farm in Dalarna, Sweden, consisting of seven 120m-high turbines, can produce enough electricity to power 16,000 Swedish homes.
They’ve also invested in a 98MW wind farm in Illinois, US, which will provide 130% of the energy they need (heating and electricity) in the US. It’ll generate up to 380 GWh of renewable energy each year – enough to power 34,000 average American households.
All local customer deliveries from the Kungens Kurva IKEA store in Stockholm, Sweden – around 36,000 a year – are made by trucks run on biogas made from waste. Using biogas can cut CO2 by more than 25% and completely stops sulphur dioxide and particulate emissions.
More than 63% of the energy used by the 44 production units in IKEA Group Industry is from renewable sources, including 80% of its heat energy.
The IKEA Group Industry facility in Esipovo, Russia, now gets around 30% of its energy from a biomass boiler in the IKEA Group distribution centre next door. In the 2014 financial year, IKEA Group Industry Divisions Flatline and Solid Wood produced 796,800 MWh worth of waste wood pellets and briquettes, which they then sold on.
BUYING RENEWABLE ENERGY
In the short term, while they work towards energy independence, IKEA Group are buying some renewable energy in line with the World Resources Institute’s guidance. This doesn’t count towards their energy independence goals, but helps them reduce their footprint in the meantime.
SPREADING THEIR INFLUENCE
It’s not just about IKEA Group’s own operations: they need to influence their customers, too. Emissions from products and customer travel contribute to around 40% of their footprint. With a presence in 42 countries, 716 million store visits and 1.5 billion website hits each year, IKEA Group are in a great position to spread the word about sustainability.
One way they’re helping their shoppers to be more green is by encouraging them to use electric vehicles. They’re installing rapid charging points across all their UK stores to complement the normal (or slow charge) points they have already. Developed by Nissan, the rapid charger units can recharge an electric vehicle from empty to 80% full in thirty minutes. IKEA Group will be the first major retailer in the UK to make these rapid charging points available to their customers.
IKEA Group has installed charging points in 18 countries and all of their largest markets. Over 25% of their stores now have charging pointsand they continue to roll this technology out across other markets.
They’ve also formed a partnership with solar company Hanergy to sell solar panels to customers in the UK, Netherlands and Switzerland. The panels can cut energy bills by up to 50%, have a lifespan of 25 years and pay for themselves within seven.
Their goals might be ambitious, but IKEA Group are well on their way. In the 2014 financial year, IKEA Group procured 27% more renewable energy that they did the year before.
Perhaps their boldest idea, though, is to change the perception of renewable energy for good. “People talk about renewable energy as ‘alternative’, but that does it a disservice,” says Steve Howard, Chief Sustainability Officer at IKEA Group. “It’s just sensible, mainstream energy.”