Danfoss has joined the First Movers Coalition (FMC), a global coalition to decarbonise hard-to-abate industries
According to the World Economic Forum, Danfoss joins the FMC aluminium sector, committing that at least 10% (by volume) of all the company’s primary aluminium procured per year will be low-carbon by 2030. Additionally, Danfoss said it is committed to ensuring that at least 50% of all aluminium used annually is composed of secondary aluminium by 2030.
This commitment by FMC members focuses on creating a sustainable value chain for aluminium and achieving a 50% reduction in carbon emissions from primary aluminium production by 2050. Danfoss has already entered into negotiations and begun contractual agreements with suppliers for low-carbon aluminium.
Led by the World Economic Forum and the US Government, the FMC targets hard-to-abate sectors including aluminium, aviation, chemicals, concrete, shipping, steel, and trucking, which are responsible for 30% of global emissions. For these sectors to decarbonise at the speed needed to keep the planet on a 1.5-degree pathway, they require low-carbon technologies that are not yet competitive with current carbon-intensive solutions.
FMC member companies commit to purchasing a percentage of near-zero or zero-carbon solutions from suppliers, which may come at a premium cost. If a critical mass of global companies commit a certain percentage of their future purchasing to clean technologies in this decade, this will create a market tipping point that will accelerate their affordability and drive long-term, net-zero transformation across industrial value chains. The FMC is currently composed of 82 members, all global players in their markets.
The aluminium industry generates approximately 2% of global emissions, but it also has the strongest potential to become carbon negative by 2050. Switching to low-carbon electricity is the biggest step the industry can take to deliver a sector compatible with net zero targets.
Danfoss has committed to achieve CO2 neutrality in its global operations (Scope 1 & 2) by 2030 – supporting the business ambition to limit global warming to 1.5°C, which has been validated by the Science Based Targets initiative (SBTi), and includes a reduction in value chain emissions (Scope 3) by 15% by 2030. In addition, Danfoss has a dedicated target of reaching 25% emissions reduction from its suppliers by 2030 compared to the 2019 baseline. This commitment is included in the targets of Danfoss’ three step-change initiatives on Decarbonisation, Circularity, and Diversity, Equity & Inclusion.
Already Danfoss has seen progress in decoupling environmental impact from business growth by delivering a 7% decrease in Scope 1 and 2 emissions while growing 15% organically in 2022.
Jürgen Fischer, president, Danfoss Climate Solutions, said, “Our customers are increasingly demanding products with a lower carbon footprint – and they’re right to do so. By joining the First Movers Coalition we are responding to this demand by fostering the critical development of low-carbon aluminium production, and thereby accelerating its entry to market. Being part of the coalition also aligns with our own commitment as a leader in the green transition, to achieve carbon neutrality across Danfoss’ global operations by 2030 and to reduce our value chain emissions by 15% by 2030.”
Rob van Riet, interim head, First Movers Coalition, said, “We are thrilled to welcome Danfoss to the First Movers Coalition, and are eager to work together towards the scaling up of the low-carbon aluminium market globally. Our joint focus will be on surfacing solutions to decarbonize aluminium and accelerate their deployment with committed organisations like Danfoss, aiming to bring these solutions to commercial scale.”
