The latest report by the Intergovernmental Panel on Climate Change (“IPCC”) states that to limit global warming to 1.5°C above pre-industrial levels and avoid the most catastrophic impacts of climate change, the world must halve CO2 emissions by 2030 and reach net-zero CO2 emissions by 2050.
Swire Properties has accelerated our efforts to fight climate change by setting new Paris Agreement-aligned SBTs that are approximately 50%27 more aggressive than our original 2°C-aligned SBTs that were approved in 2019. These new targets were officially approved in September 2021, making us the first real estate developer in Hong Kong and the Chinese Mainland to achieve this milestone.
Swire Properties is committed to reducing our absolute Scope 1 and 2 GHG emissions and strengthening these with Scope 3 reduction targets for our value-chain emissions (upstream and downstream).
Our approved SBTs that align with the 1.5°C-aligned Decarbonisation Pathway are:
| Scope 1 & 2 (Operational GHG Emissions) | Scope 3 (Indirect Upstream & Downstream GHG Emissions) | |
|---|---|---|
2025 |
| N/A |
2030 |
|
|
27 | Calculated based on the comparison between the absolute GHG emissions of the original 2°C-aligned SBTs and newly approved 1.5°C-aligned SBTs. |
| Scope 1 & 2 (Operational GHG Emissions) | |
|---|---|
2025 |
|
2030 |
|
Scope 3 (Indirect Upstream & Downstream GHG Emissions) | |
|---|---|
2025 | N/A |
2030 |
|
27 | Calculated based on the comparison between the absolute GHG emissions of the original 2°C-aligned SBTs and newly approved 1.5°C-aligned SBTs. |
Making Steady Progress Towards Our Science-based Targets
2021 progress against SBT Scope 1 and 2 targets for 2025 and 2030
2021 progress against SBT Scope 3 – Downstream Leased Assets target for 2030*
* | Our progress against the SBT Scope 3 – Capital Goods target will be reported upon the completion of Two Taikoo Place in 2022. |
Scope 1 and 2 Emissions
In 2021, Swire Properties achieved a 23% absolute carbon reduction compared to the 2019 baseline for our global portfolio. Throughout the year, we continued to adopt innovative low-carbon technologies and management practices and invest in energy research and development as part of our ongoing partnership with Tsinghua University and other entities.
We also reviewed and upgraded our energy-reduction targets and mapped out action plans and strategies for individual portfolios to support the new 1.5°C-aligned SBTs over the next decade. The respective financial requirements were also incorporated into our annual budgeting process.
As of 1st July 2021, the entire Taikoo Hui development became powered by 100% renewable electricity, generated from off-site wind power. This reduces Taikoo Hui’s annual CO2 emissions by over 12,000 tonnes and makes the portfolio net-zero carbon in its electricity consumption for both landlord and tenant operations.
Swire Hotel’s The Temple House in Chengdu also became powered by 100% renewables as of January 2021. As of the end of 2021, we increased our mix of renewable electricity in all our Chinese Mainland portfolios to approximately 47%.
Scope 3 Emissions – Downstream Leased Assets
A 34.6% reduction was recorded in 2021. This is attributed to:
- Tenant operations in Taikoo Hui and Sino-Ocean Taikoo Li Chengdu becoming powered by 100% renewable electricity in 2021 and 2020 respectively
- Improvements in tenants’ energy-use intensity
- Remote working arrangements for some tenants’ employees due to the COVID-19 pandemic
In 2021, we worked closely with commercial tenants to reduce their carbon footprints through several tenant engagement activities, including:
- Free energy audits that help tenants identify energy-saving opportunities. These have been ongoing since 2008,
- The Green Kitchen Initiative, which provides sustainable design and operation guidelines to F&B tenants. These guidelines help them use less energy and water, and encourage them to reduce waste, and
- The Smart Waste Reduction Pilot Programme, a Hong Kong office tenant initiative launched in 2021 that uses technology to track and gamify the waste reduction journey
Scope 3 Emissions – Capital Goods
To measure and analyse the upfront embodied carbon of a new development project, we have adopted various tools and types of software, including the Construction Industry Council’s (“CIC”) Carbon Assessment Tool. These allow us to evaluate a project’s carbon performance against our established SBTs. The results also help us compare the carbon performance of various possible design options, allowing us to support structural optimisation and low-carbon material adoption from the early design stages.
To reduce embodied carbon emissions throughout the lifecycle of our developments, we have established performance-based targets on embodied carbon for concrete, rebar and structural steel for future projects in Hong Kong. These targets were informed by comprehensive market research and communications with industry associations such as the Construction Industry Council.
Since 2020, we have included low-carbon procurement specifications – developed in accordance with international standards such as ISO 14067 – for construction materials such as concrete with pulverised fuel ash (“PFA”) or ground granulated blast furnace slag (“GGBS”), rebar and structural steel with recycled content.
In 2021, we continued to work closely with our contractors and suppliers to procure these low-carbon building materials and foster better energy management at our construction sites – including Two Taikoo Place and the Company’s upcoming office building on Queen’s Road East.
Swire Properties is the first real estate developer in Hong Kong to contractually require low-carbon building materials for new projects. We are now exploring this practice for Chinese Mainland developments as well.
Our progress against the SBT Scope 3 – Capital Goods target will be reported upon the completion of Two Taikoo Place in 2022.
SBTi Net-Zero Standard
This year, we were also one of the pilot companies involved in road-testing the SBTi Net-Zero Standard, supporting the SBTi as it develops the first science-based global standard for companies to set credible net-zero targets in line with a 1.5°C future. During this process, we gathered useful insights on the challenges and opportunities involved in setting near-term and long-term science-based targets to reduce Value Chain GHG Emissions and align with climate science.