ADDING BUSINESS VALUE
Actively managing our environmental impacts and reducing our footprint fosters positive relationships with stakeholders, reduces our operating costs, and sustains our ability to operate.
Being a good environmental steward is part of our business strategy. We focus our efforts on reducing the energy, emissions, water, and waste footprint of both our operations and our products.
Our global Environmental Health and Safety (EHS) Policy establishes our performance management system, which includes setting goals, measuring progress, and integrating sustainability into decision-making. Our corporate EHS teams oversee our environmental management, compliance, remediation, health and safety, and training. They also collaborate with leaders who are responsible for policy and programs across our global regions.
Manufacturing facilities account for most of our energy consumption, water use, and waste generation. At those sites, we use management systems based on the ISO 14001 and OSHAS 18001 standards to track and improve EHS performance.
We strive for 100% compliance with applicable environmental laws and regulations. In instances where a noncompliance occurs, we investigate the cause and implement corrective actions to effectively address issues and establish processes to mitigate future risks.
In FY20, we had 40 environmental compliance inspections, with five resulting in noncompliance notices. None of these inspections resulted in fines. We completed corrective actions for all noncompliance identified in FY20.
Globally, Medtronic manages 24 cleanup sites where remediation is required due to historical discharges that were permissible during past operations. Many of these sites are from acquisitions, and none of these sites are part of our ongoing operations. Nine of the U.S. sites are multiparty sites, where Medtronic entities are one of multiple potentially responsible parties addressing the site remediation under the Comprehensive Environmental Response, Compensation, and Liability Act, also known as Superfund.
Environmental performance goals
We evaluate progress toward our environmental performance goals on an annual basis. In FY20, we reached the end of our current goal cycle and exceeded all of our targets.
Progress compared to our FY13 baseline:
- 23% reduction in energy intensity
- 36% reduction in greenhouse gas (GHG) emissions intensity
- 32% reduction in metric tons of non-regulated waste intensity
- 13% reduction in metric tons of regulated waste intensity
- 20% reduction in water use intensity
MANAGING GHG EMISSIONS AND ENERGY USE
From FY13 to FY20, our global energy strategy focused on reducing emissions through energy conservation, renewable energy sourcing, and onsite generation.
Our new goals to reduce emissions by 50% and energy intensity by 20% will move us toward our ambition of being carbon neutral in our operations by FY30. This milestone will increase the resilience, longevity, and sustainability of our business as we continue to improve patient health. To achieve our carbon neutrality goal, we will continue to reduce our energy consumption, increase our use of renewable and alternative energy, partner in virtual power purchase agreements, and invest in renewable energy credits and carbon offsets.
In FY20, our combined Scope 1 and 2 GHG emissions were 281,000 metric tons of carbon dioxide equivalent (MT CO2e), a 2.7% decrease from the prior year.
Investing in energy efficiency
In FY20, our total energy use was 850,993 megawatt-hours (MWh), a 1.3% decrease from the prior year. A key component of our energy strategy is onsite generation of renewable and alternative energy, which reduces our operational emissions and reliance on grid electricity.
We generate 12% of our electricity onsite, including new capacity we added in FY20. Our new installations include solar panels, cogeneration plants, and fuel cells. We also completed the rebuild of our 17-acre solar farm at our Juncos site, which was decommissioned after Hurricane Maria in 2017. We have more than 40 projects currently underway and expect to bring an additional 67,000 MWh of capacity online in FY21.
In FY20, we centralized our evaluation process for energy efficiency projects. In our streamlined approach, energy experts from our Global Energy and Corporate EHS teams review opportunities and approve projects that best support our environmental performance goals. In FY20, we completed 79 projects that will save more than 20,000 MWh per year and reduce our operating costs by $2.8 million. The energy savings generated by these projects are equal to 2.4% of our total energy use in FY20. In FY21, we will implement projects to optimize our compressed air, building automation, and HVAC systems.
Using renewable grid electricity has been part of our energy strategy since 2007. In FY20, we utilized 121 MWh of renewable electricity, a 9% increase compared to the prior year. We plan to significantly increase our use of renewable energy to achieve our goal of being carbon neutral. By FY25, we aim to have 50% of our energy from renewable and alternative sources.
REDUCING WASTE AND WATER USE
Responsible waste and water management practices help to reduce our environmental impact, operating costs, and risk of noncompliance. To achieve our FY25 waste and water goals, our strategy will focus on efficiency, minimization, and infrastructure projects.
In FY20, we produced 24,414 MT of non-regulated waste and 2,669 MT of regulated waste, a 4.5% decrease and 11% decrease from the prior year, respectively. The decrease in waste was the result of reduction initiatives throughout our manufacturing operations.
Our nonhazardous waste reduction strategy focuses on waste prevention and minimization. As an example of our initiatives, our Strategic Meetings Management group partners with event planners to reduce the environmental footprint of meetings. During the course of normal business operations, which include in-person meetings, this project has the potential to save more than $1 million annually.
Medtronic proactively manages hazardous waste to prevent negative environmental impacts and reduce liability risks. Prior to contracting with vendors, we assess their waste management processes against our requirements. We monitor vendors throughout our relationship to ensure that they meet or exceed our standards.
Reducing water use
Water scarcity is a growing global concern, and we are preparing our business for a time when water resources are critically challenged in some regions. Though our operations are generally not water-intensive, we strive to be water-efficient and understand our water risk. Through our biennial water risk assessment, we evaluate the impact to water resources from our sites that use more than 15,000 m3 a year. We share the findings with appropriate internal stakeholders to inform long-term business plans and efficiency projects that have the potential to minimize water usage across our operations.
In FY20, our total water use was 2,092,000 m3, a 1% decrease from the prior year. We achieved this reduction through continued investment in onsite water recycling systems and a multisite plant water optimization project. The FY20 optimization project assessed water consumption at 10 sites with significant water usage. We implemented more than 20 efficiency projects identified through the assessment, which we estimate will provide annual savings of 68,000 m3 per year.
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