Neste revises climate targets due to financial position
Neste is adjusting some of its climate targets because of the company's financial situation and a streamlined investment portfolio. Achieving the original goals would have required significant, currently unrealistic, investments.
Neste Corporation has announced revisions to some of its climate targets, citing the company's current financial position and a more streamlined investment portfolio. The company stated that meeting the original, ambitious goals would have necessitated significant investments that are not currently realistic.
The company has set a new target to reduce greenhouse gas emissions from its own operations (Scope 1 & 2) by 80% by 2040, replacing the previous goal of achieving carbon-neutral production by 2035. The interim target for a 50% emission reduction has been extended from 2030 to 2035. Neste will now focus solely on absolute emission reductions within its own operations and has removed the option of using emission compensation for these targets. Two existing targets remain unchanged: reducing the use-phase emission intensity of sold products by 50% by 2040, and helping customers reduce their greenhouse gas emissions by 20 million tons annually by 2030.
CEO Heikki Malinen explained that the original targets were linked to a plan to transform the Porvoo refinery into a hub for renewable and circular solutions by 2035. As the timeline for this transformation was previously delayed, a reassessment of climate targets was conducted to ensure they are ambitious yet realistic. Malinen noted that Neste's current financial situation does not permit major capital expenditures beyond the ongoing expansion of its Rotterdam refinery. He added that given the long lead times for industry investment projects, target timelines must be adjusted under current circumstances.
In the short term, Neste will concentrate on energy efficiency measures, operational excellence, and evaluating alternatives to fossil hydrogen. Plans for the gradual conversion of the Porvoo refinery will continue, with the timeline for transitioning to renewable and circular raw materials to be determined by market demand, legislative developments, and technological advancements. Malinen reaffirmed Neste's commitment to providing alternatives to fossil fuels and contributing to climate change mitigation, while ensuring sustainable financial performance.