Ampol has announced its Future Energy and Decarbonisation Strategy, including a commitment to reaching operational net zero emissions by 2040.
The Future Energy and Decarbonisation Strategy represents an important part of Ampol’s overall strategy to continue to grow and develop its business, in addition to pursuing growth in International and Convenience Retail.
The strategy outlines a series of new commitments and initiatives from Ampol, which include:
• By 2025, operations to use 40 per cent equivalent net renewables, with a 25 per cent reduction in operational emissions on an absolute basis from 2021 levels for Convenience Retail, and a five per cent reduction in operational emissions intensity from 2021 levels for Fuels and Infrastructure.
• By 2030, operations to use 50 per cent equivalent net renewables, with a 50 per cent reduction in operational emissions on an absolute basis from 2021 levels for Convenience Retail, and a 10 per cent reduction in operational emissions intensity from 2021 levels for Fuels and Infrastructure.
• By 2040, net zero emissions from operations on an absolute basis (Scope 1 and 2 emissions).
• A minimum $100 million spend on Future Energy projects to 2025.
• The development of future energy solutions for customers, with a focus on electricity, hydrogen, gas, biofuels and carbon mitigation.
• Three new industry collaborations, including with Tesla and Enerven to pilot a virtual power plant at three retail sites, with an early-stage developer of hydrogen-based microgeneration and storage technology, and with Fusion Fuel Green PLC to jointly develop a green hydrogen production plant at Lytton.
Matt Halliday, Managing Director and CEO said that Ampol is uniquely positioned to play a key role in energy transition.
“Our integrated supply chain capabilities and privileged assets, Australian brand, customer relationships and industry knowledge, when combined with our financial strength, set us apart from our competitors and will put us at the forefront of building new energy solutions to support change across major parts of the Australian economy. The flexibility to repurpose our market leading infrastructure and distribution networks for multiple uses will support the most efficient pathway for our customers’ decarbonisation ambitions and underpins our competitive advantage to participate in new energy opportunities.
“The Future Energy and Decarbonisation Strategy announced today is headlined by our commitment to reach net zero emissions from our operations by 2040, and we have a clear and logical pathway to achieve it. We will leverage our track record of delivering energy efficiency and renewables projects to take action to reduce emissions across our operations.
“Our decarbonisation efforts and new initiatives to extend our customer value proposition will be executed with capital discipline to deliver sustainable returns for shareholders over the long-term. As a proud Australian company, we recognise the link between energy security and energy transition and will work in partnership with our customers and host governments to ensure we deliver change through an orderly transition,” Halliday said.
The strategy outlines the company’s approach to decarbonisation and its unique positioning and track record of action taken to reduce emissions, which are key to the company’s right to participate in energy transition.
It also outlines climate scenario analysis work that has been delivered with consideration of the Task Force of Climate-related Financial Disclosures (TCFD) framework and which estimates how Ampol is positioned for different climate futures in the medium to long term.
“There are a number of characteristics unique to Australia that will impact the pace of the national energy transition, including our geography, demographics and our strong base of transport and other heavy industries,” continued Halliday.
“For this reason, an orderly transition will take time, and we expect traditional liquid fuels to play a key role in Australia’s energy mix for years to come and for demand to remain resilient until at least 2030. However, we also know our customers’ needs are changing and they are seeking lower emissions alternatives. Accordingly, we must continue to evolve, innovate and adapt to help them deliver viable low emissions solutions for the future.
“As technology and policy continues to evolve, we expect the most commercially viable alternative fuel solutions to include a combination of electricity, hydrogen, biofuels, energy storage and carbon-offsets, and we will focus our efforts on developing our customer value proposition in these key areas and seek to position Ampol as a partner of choice for industry, government and our communities.
“Ampol has a proud history of working with our customers to improve the performance and efficiency of our fuels, develop new premium fuel products and additives, and support their evolving energy requirements. In 2018, Ampol’s Lytton refinery worked in partnership with the Virgin Australia Group, the Queensland Government, Brisbane Airport Corporation, and US-based biofuel producer Gevo Inc to trial the delivery of sustainable aviation fuel (bio-jet) through Brisbane Airport’s general fuel supply system.
“Ampol has also been an early adopter of new technology in energy transition, with the use of solar and batteries used to deliver off-grid solutions for the Tom Price and Onslow diesel stops in 2016, installation of solar power across our retail network, and a partnership with Evie Networks from 2020 which has trialled electric vehicle fast-charging stations at five of our retail outlets.
“Today we are very proud to announce landmark new industry collaborations with battery manufacturer Tesla and Enerven, with a developer of hydrogen-based microgeneration and storage technology and with Fusion Fuel Green PLC to jointly develop a green hydrogen production plant at Lytton. These initiatives further demonstrate our progress and commitment to decarbonisation and to developing innovative customer solutions for the future,” he said.
Ampol has signed an agreement with Enerven to install between 6-9 Tesla Powerwall batteries and between 55-99 kilowatts of solar panels at three retail sites in Adelaide. Ampol will work with Tesla to pilot a virtual power plant (VPP) that will orchestrate power generation, storage and use across several sites, reducing emissions at retail sites and providing the future option to dispatch power as required into the grid and enable the trading of electricity.
The Tesla VPP pilot is expected to provide energy savings and reductions in Scope 2 emissions, and new revenue streams from selling energy to third parties. Additionally, this will provide Ampol with the ability to assess potential integration of electric vehicle fast charging with solar and battery storage and test the potential for these initiatives to be scaled nationally across our strategically positioned retail network.
Ampol today also announces a partnership with an early-stage Australian developer of hydrogen-based microgeneration and storage technology. The technology has potential to deliver energy solutions that are economically and functionally competitive with diesel generators, offering diesel customers a low carbon alternative to remote diesel generation and has potential broader application in the residential and industrial sectors.
Finally, Ampol has executed a Heads of Agreement with Fusion Fuel Green PLC to install a demonstrator plant to produce green hydrogen at Ampol’s Lytton refinery site. The plant, which will feature a number of units, will be commissioned over the next 12 months and, if successful, provides the framework to pursue green hydrogen opportunities in the region on a joint venture basis.
In each case these examples demonstrate the unique combination of customer access and privileged infrastructure with flexibility to be adapted to a range of prospective future technologies to provide low emissions energy solutions for our customers.
Supporting the execution of the strategy at the executive level will be EGM Commercial, Brent Merrick, who’s responsibilities include Energy Transition as well as International, ensuring a strong connection back to our customers. EGM Growth and Development Alan Stuart-Grant will work alongside Merrick within the business to position Ampol to deliver on its growth ambitions in these areas.