Ingka Group, the largest IKEA retailer, has announced an additional €1.5 billion investment to phase out the direct use of fossil fuels across its operations. This move is part of the company’s ongoing renewable energy transformation and aligns with its target to reduce its climate footprint from its own operations by 85% by 2030, using 2016 as a baseline. This latest initiative complements the €7.5 billion previously committed to offsite renewable energy production and technologies.
Since beginning its renewable energy journey in 2009, Ingka Group has reduced emissions across IKEA stores by 60.4%. Currently, 96% of retail sites operate on renewable electricity. Heating and cooling remain the largest contributors to operational emissions, underscoring the importance of the company’s focus on renewable energy solutions for these systems.
Key Initiatives
Decarbonizing Operations: The €1.5 billion will accelerate energy efficiency upgrades and the installation of renewable heating and cooling technologies in IKEA properties. Plans include retrofitting 150 existing locations and ensuring all new units are equipped with renewable heating and cooling systems.
Renewable Energy Investment: Ingka Group has already invested over €4 billion in offsite renewable energy production through its investment arm, Ingka Investments, further establishing its role as a mid-sized renewable energy producer.
Science-Based Targets: The company’s efforts align with the Paris Agreement and its validated Science Based Targets (SBTi), which aim to drastically cut greenhouse gas emissions across its value chain.
Leadership Remarks
Jesper Brodin, CEO of Ingka Group, highlighted the critical role of businesses in tackling the climate crisis, emphasizing that ending reliance on fossil fuels is essential to halving global emissions by 2030. He called for stronger collaboration between governments and businesses to overcome obstacles such as policy inefficiencies and complex permitting processes.
Karen Pflug, Chief Sustainability Officer of Ingka Group, noted that transitioning to renewable heating and cooling is a costly but vital process for decarbonization. This investment, she stated, enables faster progress while delivering long-term benefits for sustainability and business performance.
Progress and Impact
Ingka Group has already achieved a 24.3% overall reduction in its climate footprint (Scope 1, 2, and 3 emissions) from FY16 to FY23, despite a 30.9% increase in revenue. This progress reflects the company’s implementation of carbon-saving measures and operational efficiencies.
