Energy + Climate
Climate + Energy The time to act is now - for all of us
Climate change is a global challenge that transcends boundaries, affecting people and communities everywhere. We view it as an environmental issue, a human rights issue, and a business issue. We also feel an ethical responsibility to address climate change by aligning our goals and strategies with the best science and industry practices.
We view climate change as both an environmental issue and a human rights issue.
Our climate goal—to achieve a 50% absolute reduction in the GHG emissions of our owned and operated facilities globally between 2015 and the end of 2020—builds on our previous goal to reduce our absolute U.S. GHG emissions 20% by 2015, based on a 2008 baseline. We exceeded that goal by achieving a 37% reduction by the end of fiscal 2015, and have achieved an additional 14% reduction from our 2015 baseline.
We have three main areas of focus to reduce our climate impacts: improving energy efficiency at our stores, offices, and distribution networks; expanding our investments in renewables; and setting ambitious, science-based goals. We also support broader change through a business-led advocacy initiative.
Improving the Energy Efficiency of Retail Stores and Distribution Networks
Retail stores are the focus of Gap Inc.’s operational energy program since they generate approximately 85% of our direct (scope 1 and 2) GHG emissions. We are taking steps to adapt to climate change and regulatory changes by piloting and expanding energy-management solutions for our retail operations, updating HVAC systems and exploring renewable energy options.
To work toward our 2020 emissions-reduction goal, we used the EPA EnergyStar platform to analyze differences in store performance and prioritize regions, brands and initiatives with the greatest opportunities for energy improvements. We piloted a new energy-efficiency program at 100 stores across North America to provide real-time monitoring and management of our energy use. We have installed LED lighting—which use 80% less energy than conventional lights—at over 1,000 of our stores. Not only do these lights reduce our energy use, they last five to 10 times longer and they pay for themselves in just two to three years.
In addition to our efforts to reduce the energy impacts of our retail stores, we look for ways to improve the efficiency of our distribution networks. In 2011, we joined a voluntary government and industry collaboration known as the SmartWay Shipper Program, which brings together carriers, freight shippers and logistics companies to improve fuel efficiency. To support that, we also have committed to using cleaner modes of transportation and encouraging the use of fuel-saving strategies and technologies. Moving forward, we are working to integrate more of our business operations into the SmartWay program and improve our data collection to better measure results.
Investing in Renewable Energy
In August 2019, we announced a 90 Megawatt (MW) virtual power purchase agreement (VPPA) for the Aurora Wind Project with Enel Green Power North America, marking one of the largest offsite renewable energy contracts by an apparel retailer. The 12-year agreement is our latest renewable energy deal and will enable us to reach our 2020 goal to reduce absolute Scope 1 and 2 greenhouse gas (GHG) emissions for its owned and operated facilities by 50 percent compared to 2015. We also announced a goal to reach 100 percent renewable energy across its global owned and operated facilities by 2030.
Earlier in 2019, together with four other companies — Bloomberg, Cox Enterprises, Salesforce and Workday — we formed a first-of-its-kind Virtual Power Purchasing Agreement (VPPA) partnership that is enabling us to procure a total of 42.5 megawatts of a 100-megawatt solar project in North Carolina. Historically, it has been difficult for individual companies with smaller energy needs to procure solar from large projects due to high transaction costs and complicated contract processes. By joining forces, however, we have expanded our buying power, and we will be able to share best practices with other companies that wish to replicate this innovative model. Each company will receive approximately the same amount of energy from the project. Gap Inc. has contracted for 7.5 megawatts of solar energy, which will offset 100 percent of the energy load for our Athleta brand’s headquarters and stores. The project is targeted to begin generating electricity in 2020.
In June 2018, we finalized an agreement to develop a 3-megawatt solar array at our Fresno, California, distribution center. The project, which will result in the equivalent of removing 254 passenger cars from the road annually, will offset more than half of the energy load at our Fresno facility and is projected to reduce energy expenses. We expect the array to begin generating power by the end of 2019. We are continuing to explore the possibility of combined renewable energy and storage opportunities in our distribution center network.
Our company can thrive only in a world with abundant natural resources and a healthy environment that supports the well-being of all of us.
Developing a Science-Based Target
In 2017, Gap Inc. signed on to the Science-Based Target initiative (SBTi) to align our climate goals with the scientific consensus and core commitment of the Paris Agreement to limit global warming below 2°C. The initiative, a partnership between CDP, WRI, WWF, and the UN Global Compact, includes more than 400 companies. By setting and meeting these goals, we are doing our part to help the world avoid the most dangerous impacts of climate change.
Our 2020 Scope 1 and 2 GHG emissions-reduction goal was based on science-based methodology. To meet the standards of the Science-Based Target protocol, we are also establishing a Scope 3 goal to reduce upstream and downstream emissions, including in transportation and our supply chain. We collect environmental data from our finished product (Tier 1) and textile manufacturing (Tier 2) suppliers using the Sustainable Apparel Coalition’s Higg index, a self-reporting tool that evaluates environmental performance and helps identify opportunities for improvement.
Through our participation in this initiative, we joined the Apparel and Footwear Sector Guidance Working Group to help define how our industry should determine Scope 3 emissions and set science-based goals. Together with other global apparel companies, we are researching and aligning on best practices and approaches to calculating Scope 3 emissions. Using this methodology, we plan to submit Gap Inc.’s science-based target for Scope 3 emissions in 2019.
Supporting Broader Change
We are also supporting broader change beyond our company. Since 2007, we have been actively engaged with Ceres, a leading nonprofit organization dedicated to mobilizing the business community to build a sustainable economy. As a member of Ceres’ Business for Innovative Climate and Energy Policy (BICEP) coalition, we advocate for progressive policy action on climate and energy issues, and publicly affirmed our commitment to the Paris Agreement on climate change. We have also signed on to the UN Fashion Charter for Climate Action. To advance transparency across the industry, our CDP Climate Change response includes detailed information on our strategy and performance, which incorporates recommendations from the Task Force on Climate-related Financial Disclosures (TCFD).
We have signed on to the UN Fashion Charter for Climate Action, aimed at reducing the impact of our business.