Ahold Delhaize Issues Revised Climate Plan

Ahold Delhaize has brought out an updated climate plan that includes what the global retail conglomerate calls “significant strides in three key areas”: refined decarbonization levers with quantified potential greenhouse-gas (GHG) emission reductions; the clarification of which categories feed into the reduction target for its value chain; discussion of the challenges involved in meeting these reductions. 

“Humanity has been living beyond its means, depleting planetary resources and stretching the boundaries of what our earth can carry,” noted Ahold Delhaize CEO Frans Muller. “Ahold Delhaize is taking action. We lead the transformation to a healthy and sustainable food system.”  

In support of this transformation, the company has set science-based (SBTi) emission reduction targets for its own operations (scope 1 and 2) as well as its entire value chain (scope 3), in accordance with the UN’s goal to limit global warming to 1.5 degrees Celsius. Ahold Delhaize also conducted research to determine the necessary levers to pull for each scope and presented these in its climate plan last year. 

“With this update, we are taking an important step forward in defining a clear action plan on both our net-zero targets and interim (2030) targets,” said Ahold Delhaize Chief Legal Officer and Chief Sustainability Officer Jan-Ernst de Groot, who recently revealed his impending retirement. “The challenge with long-term net-zero targets is to connect these with immediate actions as well as concrete plans for interim targets. Ahold Delhaize is addressing this by providing a new level of disclosure in this plan.” 

For its own operations, Ahold Delhaize has committed to becoming net-zero by 2040, with an interim target of a 50% reduction by 2030. Although scope 1 and 2 account for a relatively small part of the emissions from its value chain, these are the emissions over which it has a direct influence, so it’s focusing mainly on these reduction areas:

1. Transition to low-global-warming-potential and natural refrigerants
   The company’s 2022 mix of refrigerant types and associated leakage made up 42% of its total scope 1 and 2 emissions. It aims to reduce refrigerant emissions to achieve net zero by 2040.
2. Transition to renewable energy
   In 2022, 35% of Ahold Delhaize’s scope 1 and 2 emissions were from electricity consumption. It plans to reduce electricity emissions to zero by 2035.
3. Transition from fossil fuels in heating and transportation
   The retailer’s fossil fuel-related emissions come primarily from two sources: transport and heating. Combined, this accounts for 23% of scope 1 and 2 emissions. Ahold Delhaize’s long-term vision is to achieve 100% fossil-fuel free transport in both Europe and the United States by 2040.

For its value chain, the company committed to a 37% reduction by 2030, and to reach net zero by 2050. The majority of emissions in its brands’ value chains are from the products and services purchased from suppliers, which account for 88.1% of scope 3 emissions. Ahold Delhaize has identified three key priorities, within which are seven decarbonization levers estimated to have the greatest impact on its value chain emissions:

1. Engaging suppliers and farmers
   The company aims to engage its suppliers to set emissions-reduction targets in line with the latest science. These commitments, which will ramp up improvements in livestock farming, raw material sourcing, processing, transport, packaging, deforestation, food waste reduction and agricultural practices, could address the majority of Ahold Delhaize’s scope 3 emissions by 2030. Currently, more than 50 of its top 100 suppliers have either set science-based targets or have committed to doing so.
2. Providing assortments with a lower carbon footprint
   In collaboration with its suppliers, the company is working to reduce the carbon footprint of its local brands’ assortments. This can include promoting a health-focused and reduced-GHG emissions product lineup, investing in product development, and offering lower-emission protein sources such as plant-based alternatives. All of Ahold Delhaize food retail brands in Europe have committed to baseline their current protein ratio (animal versus plant-based) and set protein ratio targets by the end of 2024. 
3. Encouraging customers to choose lower-emission products
   To facilitate easier, informed choices through accessible information, inspiration and incentives, the company’s local brands are promoting and rewarding sustainable choices via loyalty programs and discounts, and by increasing product transparency through navigation systems and product labeling. 

“Decarbonizing the value chain is a long-term ambition that will require all parties in the chain to work together,” Ahold Delhaize said. “There are numerous challenges and opportunities on the path to decarbonization, not only for Ahold Delhaize, but our entire industry. We are committed to continuing to work together with our partners on these challenges.”

The company laid out its approach to climate scenario analysis and climate-related risks and opportunities in its most recent annual report.

Ahold Delhaize USA, a division of Zaandam, Netherlands-based Ahold Delhaize, operates more than 2,000 stores across 23 states and is No. 10 on The PG 100, Progressive Grocer’s 2023 list of the top food and consumables retailers in North America. PG also named the company one of its Retailers of the Century and its 10 Most Sustainable Grocers.