Environmental Conservation

The palm and rubber trees we cultivate in our estates in Malaysia, Indonesia, and Liberia are susceptible to a myriad of environmental factors.
Global warming may impact us in many ways and we have recognised this risk and taken steps to manage and mitigate the possible effects. In the past decade, our research has shown rising sea levels at our Carey Island estates that has increased the risk of erosion and flooding. A number of our estates are at coastal areas which may be particularly at risk to rising sea levels. 

In 2012, we embarked on a two-phase plan to identify, monitor and reduce our carbon emissions throughout our operations. Engaging an external consultant, we created a carbon monitoring tool that enabled us to calculate our carbon emissions on a periodic basis, and identify hotspots that would enable us to reduce those emissions. Choosing the year 2009 as the baseline year for emissions, it was found that the Plantation Division emitted 2.6 million tonnes of carbon dioxide equivalent through its estates, mills, and refineries. The methodology used was the GHG Protocol for Corporate Accounting, which utilises World Resource Institute (WRI) and Intergovernmental Panel on Climate Change (IPCC) methodologies and emission factors

Greenhouse Gas Emissions
 
Business Unit 2009 2010 2011 2012 2013
Estates 12.9% 11.5% 11.1% 9.9% 11.5%
(tCO2-e) 332,611 263,956 285,007 293,944 268,584
Mills 81.4% 82.1% 83.0% 83.5% 79.9%
(tCO2-e) 2,106,332 1,892,421 2,123,366 2,472,206 1,861,426
Downstream 5.5% 6.2% 5.6% 6.4% 8.2%
(tCO2-e) 142,222 142,847 143,812 188,986 191,784
Rubber Operations 0.2% 0.2% 0.2% 0.2% 0.3%
(tCO2-e) 5,827 4,486 4,486 4,845 6,566
Total 2,586,992 2,303,710 2,558,340 2,959,980 2,328,360


Biomass

Our baseline study also quantified the usage of green or renewable energy in our operations. More than 85% of our energy usage is from the combustion of oil palm waste, mainly mesocarp fibre and kernel shells. The palm oil industry has long been known as having self-sufficient milling operations, as the power and heat generated from these waste products is more than enough to cover the energy needs of palm oil mills. 

For perspective, to replace biomass as a clean energy source an estimated additional 7 million litres of diesel would be required, entailing an additional 1.9 million tonnes of carbon emissions.

 


Biogas
Biogas is the main driver of carbon emission reductions under our Carbon Reduction Strategy. Biogas plants capture methane emitted from anaerobic wastewater treatment ponds that would otherwise be released into the atmosphere. We have estimated that the establishment of biogas plants at 50% of our current mills in Indonesia and Malaysia would enable us to reduce our total operational emissions by 40% by 2020. 

Our first biogas plant was built in 2009 at the West Oil Mill in Carey Island, our research hub in Malaysia. We also have an installation at the Tennamaram Oil Mill in Selangor, Malaysia which was one of the first plants where an open flaring system was installed. An open flare system ensures that there is no direct release of methane, which is 25 times more damaging than carbon dioxide. We have identified 17 mills in total where biogas will be implemented (1st stage) and an additional 9 plants (2nd stage) would need to be identified. All planned biogas plants need to be up and running to achieve the emission reduction target.

Read Case Study on Biogas


Clean Development Mechanism
Sime Darby Plantation operates four composting plants that are registered under the UN’s Clean Development Mechanism (CDM) that were jointly developed with Denmark as our Annex 1 partner. The projects generated Certified Emission Reductions (CER) from 2010 to end-2012, culminating in the delivery of more than 180,000 CERs to Denmark. The four success - full projects are among the first of its kind in Asia to achieve issuance of CERs. The projects continue to be in operation as part of our Carbon Reduction Strategy, along with 18 other composting plants. 
 
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