♦ Energy and greenhouse gases
As discussed in the previous section, the manufacture of ammonia and ammonia-derived products is energy-intensive, requiring natural gas as both a raw material and an energy source. The intensity of energy use and carbon emissions associated with our two main manufacturing processes is shown in the life cycle assessments for ammonia and ammonium nitrate. Assurance was obtained over our Australian GHG emissions, energy consumption and production figures for the period 1 July 2015 to 30 June 2016. The third party issued an unqualified opinion over our reported emissions, energy production and energy consumption.
Energy useIPL used 44,972,204 gigajoules (GJ) of energy over the past year, 1,971,644 of which was purchased electricity. Approximately 80 percent of the electricity purchased was generated from non-renewable sources. Approximately 20 percent of the purchased electricity (indirect energy) was generated from renewable resources, mostly hydroelectric. Natural gas and diesel amounts used as raw materials and on-sold in our products have been included in our energy use figure. Approximately 1 percent of our direct energy is from CO2e-free sources, which includes electricity that is generated from heat captured during the manufacture of sulphuric acid.
Greenhouse gas emissionsWe are a ‘large emitter’ of greenhouse gases (GHG), as defined by the Australian National Greenhouse and Energy Reporting System (NGERS). During 2016 our recorded Scope 1 (direct) and 2 (indirect) absolute GHG emissions were 2.7 million tonnes of carbon dioxide equivalent (CO2e). The total figure comprises 2.4 million tonnes of Scope 1 (direct) emissions and 0.3 million tonnes of Scope 2 (indirect) emissions.
Read about the GHG reduction targets we achieved and set this year at Our Targets.
Improving our performance
In line with the sustainability strategy to ‘Use Less’ and ‘Care for the Environment’, our manufacturing plants continued to reduce both energy use and carbon emissions in 2016 through initiatives such as lighting reviews, plant energy optimization projects and other continuous improvements. At St Helens, Oregon, pneumatically controlled instrumentation was converted to electronic instrumentation, reducing air compressor loads. At Cheyenne, Wyoming, natural gas use was reduced at one plant by increasing purge gas feed from another plant, and a full site energy audit was conducted at Graham, Kentucky, with plans to implement improvements in 2017. The Company also directly invested over $1,000,000 in 2016 in the nitrous oxide abatement unit at Moranbah, Queensland, which reduced GHG emissions by 358,270 tonnes CO2e during the reporting period. We also quantified the Scope 3 emissions associated with our shipping for the first time in 2016.
Our new Waggaman, Louisiana ammonia plant uses the industry’s leading technology and is among the most efficient plants of its kind in the world, employing gas purifier technology and recapturing steam for reuse. In addition, approximately 10 percent of the CO2 generated will be captured and exported for use in making urea and melamine.
Due to improvements in plant efficiency, and the installation of Selective Catalytic reduction technology at our Louisiana Missouri plant, we have set ambitious global targets to reduce our GHG emissions by 3% per tonne of nitric acid produced and by 2% per tonne of ammonia produced by 2017.
The efficiency targets at Waggaman which support these reductions in emissions are linked to executive remuneration as explained in our 2016 Annual Report, and the installation of Selective Catalytic reduction at our Louisiana, Missouri site will reduce the site’s GHG emissions by 5% by 2017.