DECARBONIZATION AND GREENHOUSE GAS EMISSIONS
The set of greenhouse gas emissions, produced directly or indirectly by individuals, organizations, products, events, or geographical regions and expressed in terms of CO2 equivalent, make up the carbon footprint as a way of quantifying the impact that an activity or process of a company has on climate change. According to GHG Protocol, it consists of the following scopes:
The set of greenhouse gas emissions, produced directly or indirectly by individuals, organizations, products, events, or geographical regions and expressed in terms of CO2 equivalent, make up the carbon footprint as a way of quantifying the impact that an activity or process of a company has on climate change. According to GHG Protocol, it consists of the following scopes:
| Scope 1 | Scope 2 | Scope 3 |
| Direct emissions from fixed and mobile sources | Indirect emissions from the generation of energy compared to third parties | Other indirect emissions in the supply chain |
Our corporate sustainable development goals for GHG emissions are to reduce absolute Scope 1 and 2 GHG emissions by 50.4% by 2030 from a base year of 2018 and to reduce absolute Scope 3 GHG emissions by 37.5% by 2035 from a base year of 2020*.
In addition, CMPC is committed to becoming a Net Zero emissions company by 2040.
*The target boundary includes biogenic emissions and removals from bioenergy feedstocks
GOAL 13.3:
Improve education, awareness, and human and institutional capacity for climate change mitigation, adaptation, impact reduction, and early warning.
SCOPE 1 AND 2 EMISSIONS 2030 GOAL
| 2018 Baseline | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2030 Goal | |
| Performance (ktCO2e) | 2,457 | 2,513 | 2,210 | 2,091 | 2,039 | 1,892 | 1,598 | 1,219 (-50%) |
| Annual variation (ktCO2e) | – | -56 | 247 | 366 | 418 | 565 | 859 | 1,219 |
| Percentage of progress towards goal | – | -4.6% | 20.1% | 29.8% | 34% | 46.0% | 69.9% | 100% |
Source: Sustainability Department.
SCOPE 3 EMISSIONS 2035 GOAL
| 2020 Baseline | 2022 | 2023 | 2024 | 2035 Goal | |
| Performance (ktCO2e) | 5,889 | 6,126 | 6,114 | 6,258 | 3,681 (-37.5%) |
| Annual variation (ktCO2e) | - | 237 | 225 | 369 | -2,208 |
| Percentage of progress towards goal | - | -10.7% | -10.2% | 16.71% | 100% |
Source: Sustainability Department.
Note: The SBTi methodology is used to model goal-setting with at least 2/3 of scope 3 coverage when it adds up to at least 40% of the GHG emissions inventory (scopes 1, 2 and 3).
CARBON FOOTPRINT:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |||||||
| ktCO2e | Percentage | ktCO2e | Percentage | ktCO2e | Percentage | ktCO2e | Percentage | ktCO2e | Percentage | ktCO2e | Percentage | |
| Scope 1 | 2,025 | 18.50% | 1,995 | 19.30% | 1,905 | 19.27% | 1,838 | 17.99% | 1,802 | 18.01% | 1,523 | 15.63% |
| Scope 2 (market-based approach) | 448 | 4.10% | 189 | 1.83% | 161 | 1.63% | 177 | 1.73% | 86 | 0.86% | 76 | 0.78% |
| Scope 2 (location-based approach) | 624 | – | 583 | – | 641 | – | 547 | - | 467 | - | 398 | - |
| Scope 3 | 8,380 | 77.40% | 8,152 | 78.87% | 7,821 | 79.10% | 8,199 | 80.27% | 8,116 | 81.13% | 8,148 | 83.59% |
| Total emissions | 10,831 | 10,336 | 100% | 9,887 | 100% | 10,214 | 100.00% | 10,004 | 100.00% | 9,747 | 100.00% | |
| Emission intensity (tCO2e/ton) | 0.253 | 0.223 | 0.213 | 0.218 | 0.203 | 0.157 | ||||||
Note 1: The emissions inventory is verified by a third party in compliance with the requirements of the GHG Protocol’s Corporate Standard for Quantification and Reporting.
Note 2: For the greenhouse gas emissions inventory, it considers the estimation of Scope 2 based on the market method.
Note 3: The emissions intensity indicator was calculated with Scope 1 and 2, and production only considers sales to third parties.
In 2020, CMPC conducted a full scope 3 study, expanding its emissions inventory and including all the categories recommended by the GHG Protocol. Therefore, the variation compared to 2018 is not an actual increase but the results of including the new categories.
In 2021, we joined the global initiative Business Ambition for 1.5°C, aligning ourselves with the Race to Zero campaign. This commitment entails becoming a net-zero emissions company by 2040. Race to Zero is a United Nations-led campaign that aims to fill this gap by collaborating with businesses, cities, regions, investors, and financial and educational institutions, all committed to achieving net-zero carbon emissions by 2050 at the latest.
In 2022, we entered and validated our Scope 1 and Scope 2 targets, as well as our Scope 3 targets, with the Science Based Targets Initiative (SBTi).
CMPC fully supports the objectives outlined in the Paris Agreement and actively promotes the development and implementation of policies and regulations that align with this commitment in all countries where we operate. To ensure that the activities that may have the potential to influence public policy are in line with this commitment, Corporate Affairs oversees all engagements with trade associations and donations associated with political influence. Furthermore, any activities pertaining to representation, company’s stance, working groups, and technical and/or strategic aspects related to climate change are directed to the Sustainability Management department, as they possess the required expertise in this area. The Sustainability Manager plays a pivotal role in bringing forward key issues to the Sustainability and Regulation Committee, which convenes on a quarterly basis. The committee is composed by the Chairman of the Board, three (3) Directors, the CEO, Vice President of Legal and Compliance, Vice President of Corporate Affairs and Sustainability, Environment, Safety and Occupational Health Manager, and the Sustainability Manager.
In 2020, CMPC conducted a full scope 3 study, expanding its emissions inventory and including all the categories recommended by the GHG Protocol. Therefore, the variation compared to 2018 is not an actual increase but the results of including the new categories.
In 2021, we joined the global initiative Business Ambition for 1.5°C, aligning ourselves with the Race to Zero campaign. This commitment entails becoming a net-zero emissions company by 2040. Race to Zero is a United Nations-led campaign that aims to fill this gap by collaborating with businesses, cities, regions, investors, and financial and educational institutions, all committed to achieving net-zero carbon emissions by 2050 at the latest.
In 2022, we entered and validated our Scope 1 and Scope 2 targets, as well as our Scope 3 targets, with the Science Based Targets Initiative (SBTi).
CMPC fully supports the objectives outlined in the Paris Agreement and actively promotes the development and implementation of policies and regulations that align with this commitment in all countries where we operate. To ensure that the activities that may have the potential to influence public policy are in line with this commitment, Corporate Affairs oversees all engagements with trade associations and donations associated with political influence. Furthermore, any activities pertaining to representation, company’s stance, working groups, and technical and/or strategic aspects related to climate change are directed to the Sustainability Management department, as they possess the required expertise in this area. The Sustainability Manager plays a pivotal role in bringing forward key issues to the Sustainability and Regulation Committee, which convenes on a quarterly basis. The committee is composed by the Chairman of the Board, three (3) Directors, the CEO, Vice President of Legal and Compliance, Vice President of Corporate Affairs and Sustainability, Environment, Safety and Occupational Health Manager, and the Sustainability Manager.
Moreover, CMPC actively participates in various initiatives and coalitions that are dedicated to ensuring compliance with the Paris Agreement and advancing on decarbonization objectives that are aligned with scientific recommendations:
| Science Based Targets Initiative | View site |
| Business Ambition for 1.5°C | View site |
| Race to Zero | View site |
| Pacto Global Chile | View site |
| World Business Council for Sustainable Development (WBCSD) | View site |
| Corporate Leaders Group (CLG Chile) | View site |
| Acción Empresas | View site |
| British Chilean Chamber of Commerce (BRITCHAM) | View site |
| CORMA | View site |
| SOFOFA | View site |
| Public Statement by CLG-Chile: In the face of the climate crisis, we pledge to take collaborative and decisive action urgently | View statement |
Identification of risks associated with climate change
During 2024, a consulting firm specialized in ESG risks provided technical assistance in the implementation of the Task Force on Climate-Related Financial Disclosures (TCFD) standard. This process included the analysis of physical risk scenarios by using IPCC risk modeling, considering three scenarios: optimistic, medium and pessimistic, in the short- (2030), medium- (2040 and 2050) and long-term (2080) time horizons. This also included an assessment of transition risks and opportunities, considering climate scenarios in the short- (2030) and medium-term (2050) horizons.
It considered nine categories of weather events, including extreme weather and fires, as part of the analysis. The selected scenarios correspond to those defined by the IPCC’s Shared Socioeconomic Pathways (SSP) (AR6): SSP1-2.6, SSP3-7.0 and SSP8-5.
The Company also assessed transition risks and opportunities based on international scenarios, such as the Network for Greening the Financial System (NGFS), the International Energy Agency (IEA NZE, APS and STEPS scenarios) and the WBCSD, and short and medium-term time horizons, prioritizing opportunities of greater interest or impact for the Company.
This analysis used historical weather event data, internal and external sources, and included interviews with executives and key employees. The risk management procedure establishes time horizons associated with the probability of occurrence:
- Short-term: Risk with a probability of occurrence between 6 months and 2 years.
- Medium-term: Risk with a probability of occurrence between 2 and 5 years.
- Long-term: Risk with a probability of occurrence between 5 and 10 years
Internal Carbon Price
During 2024, CMPC developed an Internal Carbon Price (ICP), a tool designed to internalize the impact of greenhouse gas emissions in decision making, ensuring their alignment with its environmental commitments.
Its application aims to assign an economic value to the generation or reduction of emissions, incorporating this criterion into the assessment of projects in critical areas such as investments, purchases and operations. At CMPC, the ICP is a fundamental instrument for prioritizing initiatives that contribute to the Net Zero target, promoting a more efficient and sustainable management.
The implementation of the ICP focuses on all investment projects that directly impact CMPC’s Scope 1 emissions. Additionally, a pilot is underway to assess suppliers whose products and services influence Scope 1 emissions, such as energy purchases and forestry services.
The ICP is based on a Shadow Price model, assigning a carbon price of 50 USD/tCO2e to guide decision-making processes that affect the Company’s strategic Net Zero target.
During 2024, a consulting firm specialized in ESG risks provided technical assistance in the implementation of the Task Force on Climate-Related Financial Disclosures (TCFD) standard. This process included the analysis of physical risk scenarios by using IPCC risk modeling, considering three scenarios: optimistic, medium and pessimistic, in the short- (2030), medium- (2040 and 2050) and long-term (2080) time horizons. This also included an assessment of transition risks and opportunities, considering climate scenarios in the short- (2030) and medium-term (2050) horizons.
It considered nine categories of weather events, including extreme weather and fires, as part of the analysis. The selected scenarios correspond to those defined by the IPCC’s Shared Socioeconomic Pathways (SSP) (AR6): SSP1-2.6, SSP3-7.0 and SSP8-5.
The Company also assessed transition risks and opportunities based on international scenarios, such as the Network for Greening the Financial System (NGFS), the International Energy Agency (IEA NZE, APS and STEPS scenarios) and the WBCSD, and short and medium-term time horizons, prioritizing opportunities of greater interest or impact for the Company.
This analysis used historical weather event data, internal and external sources, and included interviews with executives and key employees. The risk management procedure establishes time horizons associated with the probability of occurrence:
- Short-term: Risk with a probability of occurrence between 6 months and 2 years.
- Medium-term: Risk with a probability of occurrence between 2 and 5 years.
- Long-term: Risk with a probability of occurrence between 5 and 10 years
Internal Carbon Price
During 2024, CMPC developed an Internal Carbon Price (ICP), a tool designed to internalize the impact of greenhouse gas emissions in decision making, ensuring their alignment with its environmental commitments.
Its application aims to assign an economic value to the generation or reduction of emissions, incorporating this criterion into the assessment of projects in critical areas such as investments, purchases and operations. At CMPC, the ICP is a fundamental instrument for prioritizing initiatives that contribute to the Net Zero target, promoting a more efficient and sustainable management.
The implementation of the ICP focuses on all investment projects that directly impact CMPC’s Scope 1 emissions. Additionally, a pilot is underway to assess suppliers whose products and services influence Scope 1 emissions, such as energy purchases and forestry services.
The ICP is based on a Shadow Price model, assigning a carbon price of 50 USD/tCO2e to guide decision-making processes that affect the Company’s strategic Net Zero target.
