Climate Change
The reality and threat of climate change is clear. The response from policy makers and consumers is growing year by year and society is re-evaluating consumption patterns and use of natural resources. This in turn requires the business community to respond positively to new commercial risks and opportunities.
The DCC Carbon Management Plan, established in 2008, sets out objectives for measuring, reducing and reporting carbon emissions. The plan is currently being revised to include medium and long term carbon reduction targets.
In the UK the CRC Energy Efficiency Scheme has been significantly amended following the Comprehensive Spending Review initiated by the new government in October 2010. Originally designed to allow revenue to be recycled to the participants, the Scheme is now effectively a carbon levy on fuel and electricity consumption, payable annually from July 2012 onwards. Some uncertainty still surrounds the final details of the Scheme but DCC’s UK subsidiaries have robust reporting systems in place to provide the required energy consumption data to the Environment Agency in July 2011.
DCC responds annually to the investor led Carbon Disclosure Project, providing detailed emissions data and explanations of our strategic approach and the management of risks and opportunities from climate change.
Details of our energy use and carbon emissions are presented below. The DCC Energy and Carbon Reporting Guidelines, based on the Greenhouse Gas Protocol, set out in detail the sources included in the DCC Group carbon footprint3. Briefly these are:
- subsidiaries of DCC plc1
- the energy sources where DCC is the counter party to the contract to supply
- direct usage of electricity and fuels to heat, light and operate buildings
- fuels used to operate company owned vehicles, plant and machinery
- electricity and gas purchased and recharged to subtenants
- any new sites from the point at which they are operational
- any new acquisitions from the point at which they are acquired
Transport and heating fuels make up the direct sources of primary energy purchased within the Group. In total they represented 1,454,813 Gigajoules (GJ) of energy. Indirect energy consumption amounted to 164,570 GJ from electricity purchased. While a number of subsidiaries purchase some of their electricity from renewable sources this has not been recorded during the year. Systems to record renewable energy purchases have been introduced and will be reported in next year’s Sustainability Report.
Total carbon emissions increased by 16% over the prior year, primarily driven by acquisitions in the Energy division and increased processing capacity in the environmental and healthcare businesses.
Outside of emissions generated by our own operations, as reported above, the use of fuel products sold within the Energy division represent the most significant source of indirect emissions beyond our immediate control. The use of oil, LPG and natural gas sold by DCC Energy subsidiaries account for approximately 19 million tonnes of CO2e emissions. Opportunities to reduce these emissions over time include the development of lower carbon fuels and the provision of energy efficiency advice to customers.
Environmental compliance and spills
During the year 47 routine site inspections of our licenced facilities were completed by environmental regulators. Overall our level of compliance with permitting requirements was high. During one inspection, two non compliances, principally due to extreme weather conditions causing operational difficulties, were recorded and resulted in the issue of two enforcement notices.
All remedial actions identified in the notices have been completed to the satisfaction of the regulator.
During the year GB Oils was fined Stg£5,000 for polluting a tributary of the River Clyst in Devon in July 2009, contrary to Section 83(1) of the UK Water Resources Act 1991. The Court recognised the work undertaken by the company to remediate the environmental impact of the spill. Approximately 20,000 litres of diesel was lost when an underground pipeline failed at a recently acquired depot. Underground pipework at our oil depots is pressure tested annually and, where possible, replaced with over ground pipework. There were no other significant releases of oil or chemicals during the period.
In June 2010 the Scottish Government released its Zero Waste plan which establishes a goal of recycling 70% of Scotland’s waste by 2025. Supporting this agenda, the William Tracey Group has launched a food and organic waste collection service for customers. A key part of the service will be an anaerobic digestion treatment plant constructed by Scottish and Southern Energy (SEE) at Traceys former landfill site in Barkip, North Ayrshire where landfill gas is currently being used to generate renewable energy. The new SSE facility will be capable of processing around 75,000 tonnes of organic waste annually and producing 2.5 MW of electricity which will contribute towards Scotland’s renewable energy targets.
1 Virtus, a US healthcare subsidiary with 131 employees, in which DCC is a 51% shareholder, is not included within the scope of this report. It will be included in next year’s report.
3 Carbon dioxide makes up over 98% of the Groups’ greenhouse gas emissions. Other greenhouse gas emissions include fugitive refrigerant gases from our chilled foods logistics business and methane emissions from a small capped landfill. Carbon dioxide emissions arising from our composting operations are considered to be part of the natural cycle and are not included in the reported figures.