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NYSE: RAI $62.64   +0.36 (0.575%)
Environmental Sustainability

Greenhouse Gas & Energy

In 2009, RAI and its operating companies established a five-year plan to stabilize and maintain greenhouse gas (GHG) emissions at their 2009 levels. We exceeded that goal, with 2014 emissions more than 88,000 metric tons lower than our 2009 actuals, a 26 percent reduction. In 2015, we introduced new GHG and energy goals. The new goals are based on the results of the third-party environmental materiality assessment we completed in 2015. The new goals are to:

GOALS
  • Stabilize GHG emissions by 2025 to the 2014 level;
  • Reduce GHG intensity (tons/$million revenue) by 20% by 2020 against 2014 baseline; and
  • Reduce energy intensity (GJ/$million revenue) by 25% by 2020 against 2014 baseline.

While these goals apply to Scope 1 and Scope 2 emissions, we also track and continue to work to reduce Scope 3 emissions, internally by making tools available to reduce the necessity for employee travel and increasing use of telecommunications, and externally by working with our supply chain partners.

In 2015, we received a score of 98-B, compared to a program average 84-C, for our CDP Climate Change response (formerly known as the Carbon Disclosure Project Investor Response). We are proud to receive a score indicative of our subsidiaries’ continued efforts to address climate change and climate change transparency. We have reported on our subsidiaries’ progress toward reducing greenhouse gas and energy use to CDP since 2007 and expanded our submission to include Scope 3 emissions in 2015.


TOTAL DIRECT AND INDIRECT GREENHOUSE GAS EMISSIONS

331,997
309,614
294,252
274,495
276,554
243,266
247,529
2009 2010 2011 2012 2013 2014* 2015*
CO2 Equivalent (Metric Tonnes)

*2014 and 2015 data reflect updated emission factors, including AR4 (2007) GHG Global Warming Potentials

TOTAL ENERGY USE

3,850,408
2,448,164
1,402,244
3,531,349
2,181,993
1,349,356
3,458,457
2,185,841
1,272,616
3,243,564
2,063,141
1,180,423
3,276,133
2,096,237
1,179,896
3,183,253
2,018,983
1,164,270
3,252,678
2,067,678
1,185,000
2009 2010 2011 2012 2013 2014 2015
Direct Energy Use (Gigajoules)      
Indirect Energy Use (Gigajoules)


Each operating company is responsible for identifying and executing its own strategy to meet these goals. Through the materiality assessment results, operating companies are equipped with specific opportunities and able to prioritize effective reduction strategies.

R.J. Reynolds, for instance, continued reducing electricity use in a warehouse location. By conducting a comprehensive study of traffic patterns within the warehouse in 2014, the company discovered that less than 70 percent of the lights had to be on continuously. At year-end 2014, all metal halide lighting was converted to LED and occupancy sensors were added. This change led to a reduction in warehouse electrical consumption of over 1.2 million kilowatt hours and yielded more than $85,000 per year of electrical and maintenance savings in 2015. The company also performed lighting audits at their Whitaker Park steam plant. The audits revealed that nearly 50 metal halide lights could be removed from service, reducing electrical consumption by 92,000 kilowatt hours and saving more than $5,000 per year. At their Tobaccoville, North Carolina, manufacturing plant, R.J. Reynolds began implementing new condenser water temperature controls to provide colder chilled water to each centrifugal chiller. Upon completion, the modifications will improve the operating efficiency of the chiller plant, reduce 165,000 kilowatt hours of electrical consumption and provide nearly $10,000 in annual savings.

SFNTC continues to purchase 100 percent of its electricity use from renewable resources and its operations have been carbon neutral since 2011. Read more about SFNTC’s sustainability initiatives, here.

While 2015 emissions increased over 2014 due to an increase in production, this increase was modest due to our emissions reduction activities. Overall, our efforts have led to a reduction in emissions of 26 percent since 2009. Energy use increased over 2014 by 2 percent, on a 9 percent increase in production volume, but remained below the 2009 baseline by 16 percent. Read more about energy reduction projects here. In support of our GHG and energy goals, each operating company is tasked with evaluating and implementing at least one energy reduction project in 2016.