Ikea Considers Price On Carbon

The Ikea Group may be putting a price on carbon emissions, Reuters reports. “There was a lot of discussion about carbon pricing and putting an internal price on carbon,” Chief Executive Peter Agnefjall said at the Reuters Global Climate Change Summit. “That's definitely something we bring home and that we will analyze in the coming months.”

The company is making great strides to become more sustainable. It has committed to investing €1.5 billion until 2015 in renewable energy, mainly wind and solar power. The goal is for the company to become energy neutral by producing as much renewable energy as it consumes in its operations. By 2015, Ikea aims to produce at least 70 percent of its energy consumption from renewable sources.

The company has other sustainability goals, including:

• Reducing carbon emissions from its operations by 50 percent by 2015.


• Become 20 percent more energy efficient in its operations by 2015, and encourage its direct suppliers to achieve the same goal by 2017.


• By 2020, it will source 100 percent of its wood, paper and cardboard from more sustainable sources.


• By 2015, all cotton sourced will come from more sustainable sources.


• By 2015, all home furnishings, including packaging, will be made from renewable, recyclable, or recycled materials.


• By 2017, at least 50 percent of its wood is to come from more sustainable sources.


• By 2020, all plastic materials used in its home furnishing products will come from renewable or recycled materials.


• By 2020, 30 percent of the wood used will be recycled.


• By 2020, 90 percent of the waste from its operations will be recycled or the energy will be recovered.

“We see sustainability as a driver of building a new and better IKEA,” Chief Executive  Peter Agnefjall said at the Reuters Global Climate Change Summit.

There are companies who currently have set an internal price on carbon emissions, according to a 2013 survey by CDP. They have integrated carbon pricing into their operations. The prices range from $6 to 60 per metric ton of carbon. Companies use varying terminology including “internal carbon price,” “shadow price,” “internal carbon fee,” “carbon adder,” or “carbon cost.” Fossil fuel companies also set a carbon price. ExxonMobil sets a price of $60 per metric ton by 2030 while BP and Royal Dutch Shell use a $40 per metric ton price. Xcel Energy uses a $20 per ton price while Devon Energy uses a $15 per ton price.

The climate has warmed considerably since the 1950s, a 2014 UN report states. Carbon concentrations have increased by 40 percent since pre-industrial times, coming mostly from fossil fuel emissions.

Photo: kaktuslampan