Valeo – Aiming for Carbon Neutrality by 2050
In 2021, global automotive supplier Valeo committed to reaching carbon neutrality by 2050. With $21 billion in sales and 109,900 employees in 29 countries, Valeo has a presence in Troy, Auburn Hills, and Highland Park. SBN Detroit interviewed Valeo Group CAP50 Director Zobeida Gutierrez about the company’s sustainability efforts globally and its impact on Southeast Michigan. Q: Tell us about the CAP50 project. A: Championed by CEO and President Christophe Périllat, Valeo’s global decarbonization plan primarily focuses on 156 production plants. However, our actions extend to our design centers and Valeo Service activities around the world. I have worked for Valeo for thirty years in a variety of positions, including roles in quality in operations, supplier quality, project management, and special projects. I am now the global lead for Valeo’s CAP50 decarbonization plan, and I support other sustainability and circular economy initiatives within North America. Q: What are the specifics of the plan? A: This is our action plan to contribute to carbon neutrality by 2050 across the entire Valeo value chain. Valeo has set 2030 near-term CO2 reduction targets validated by SBTi (Science Based Target initiative) Scope 1 and 2 CO2 emission absolute value reduction of 75% and Scope 3 upstream and downstream reduction of 15% from our 2019 baseline. This goal translates to removing 8.1 million metric tons of greenhouse gas emissions by 2030. Since 2019, we have removed 4.4 million metric tons as of the end of 2022, confirming the effectiveness of our CAP 50 plan. The second reduction target integrates benefits realized from electrification within our product portfolio, accounting for a 45% CO2 emission reduction due to avoided emissions at third parties as compared to the 2019 CO2 emissions footprint baseline. Q: What actions are you taking to achieve this? A: Our framework includes all three scopes as well as greenhouse gas emissions. Scope 1 targets direct emissions coming from our operations. We are currently investing to get our top 100 CO2 emitting sites Energy Management ISO 50001 certified to ensure they are focusing on energy efficiency to drive a 30% reduction in energy consumption by 2030. We are also switching to LED lights, eliminating fuel, oil, and natural gas use, installing solar panels at our sites, and introducing energy-efficient equipment. Scope 2 focuses on indirect greenhouse gas emissions incurred by our energy suppliers. Our low-carbon electricity procurement supports the increase of renewable energy capacity projects. Our internal target is to secure 50% of energy coming from renewable sources by 2025 and 80% by 2030. Valeo has committed to investing $436 million to support Scope 1 and Scope 2 actions. Scope 3 involves indirect greenhouse gas emissions within our supply chain, upstream and downstream. Upstream efforts target indirect emissions incurred by our suppliers, and downstream efforts target indirect emissions incurred by the use and end-of-life of our products. For Scope 3 upstream, we launched a sustainability assessment questionnaire to evaluate our supply chain sustainability maturity level. We also align our suppliers’ greenhouse gas emissions targets with ours – a reduction of 75% for Scope 1 and Scope 2 and 15% for Scope 3 Upstream emissions vs. their baseline year. Our suppliers are also required to cascade these targets throughout their entire supply chain. Our transportation levers within Scope 3 include greener fuels, optimization of filling rates for trucks, multimodal scenarios such as replacing airfreight with train or truck, and the use of returnable and greener packaging. For Scope 3 downstream, Valeo is accelerating its technological roadmap and cementing its global leadership in the electrification market. Currently, 60% of our portfolio supports EVs. We are researching and validating greener materials and designing more energy-efficient, lighter, and greener products. No reduction in greenhouse gas emissions is too small. Every Ton of CO2 reduced counts. Even if it’s simply balancing HVAC systems in our buildings to save energy, simple things can add up to several tons of CO2 emissions reductions. Q: How is your team structured to support the goals and initiatives? A: It starts at the top. Our board of directors has set targets and reviewed achievements related to sustainability and climate change since 2016. In addition, since 2020, a director has been responsible for monitoring corporate social responsibility issues. The Chief Sustainability Officer position within Valeo aligns with the Corporate Vice President of Sustainable Development and External Affairs, who works in partnership with the Chief Technology Officer and Vice President of Strategy. Sustainability topics are therefore under the direct oversight and management of the CEO. Our human resources, health, safety, and environmental, ethics and compliance, research and development, and operations departments (purchasing, quality, projects, industrial) all contribute to Valeo’s sustainable development policy, and each business group assigns CAP 50 champions. Q: What are your biggest challenges? A: Our biggest concern – which is not unique to Valeo – is the lack of renewable energy capacity. The world needs to triple global renewable capacity from 2022 levels by 2030, which must reach 11,000 gigawatts in line with the International Energy Agency’s net zero emissions by 2050 scenario. Also, there is a need for stronger domestic policies and international support, most notably in clean energy investment in emerging and developing economies. Q: What are the biggest opportunities? A: Electrification acceleration. The introduction of electric vehicles is an opportunity, not only for cars but also for micromobility. Another opportunity is preserving our resources by creating a circular economy. Valeo has created the 4R Circle, which is our plan for Robust Design, Remanufacturing, Repair, and Recycling aimed at reducing the use of raw materials and preserving the planet’s resources by giving our products extended life and recyclability options. Q: How is the work you are doing impacting Southeast Michigan? A: In June 2022, we signed a contract with energy supplier DTE Energy to contribute 100% of renewable energy usage at our Michigan locations (Troy, Auburn Hills, and Highland Park) starting in April 2024. This contract is for 20 years, and it demonstrates Valeo’s commitment to supporting renewable energy projects
African American-Led Grocery to Open Soon in Detroit
The Detroit People’s Food Co-op – projected to open in February at 8324 Woodward Ave. in Detroit’s North End – is an African-American-led, community-owned grocery cooperative. It seeks to address the issue of food insecurity, educate the community about nutrition and sustainability, support local businesses, and pump investment back into the area. Malik Yakini is the cofounder and executive director of the Detroit Black Community Food Security Network, the nonprofit organization that led the formation of the co-op, and serves on the co-op’s board. SBN Detroit spoke to Yakini about the co-op’s vision and sustainability goals. Q: Tell me about Detroit People’s Food Co-op. A: The Detroit People’s Food Co-op is a grocery store that’s in the development stage and is owned by member-owners. It’s projected to open in February 2024 and will have a full line of groceries, including produce sourced locally and regionally. It will carry value-added products that are produced by local entrepreneurs, and as much as possible we will hire staff from Detroit. The most significant part of a co-op is that it is not a corporation coming into Detroit to profit. It’s people in the community banding together to co-own the store so that the community reaps the benefits and profits. Currently, we have 1,958 member-owners. In this pre-opening stage, the member-owners make a lot of the decisions and shape the direction and culture of the store. The member-owners elect six of the nine members of the co-op’s board of directors, and DBCFSN appoints the other three. In June, the board contracted with an interim general manager who is tasked with getting the final pre-opening tasks done, coordinating the opening, and making sure that the store is positioned for success. The board hopes to hire a permanent general manager in the next few months. The other benefit of being a member-owner is the opportunity to share in the profits of the store. In any year the store is profitable, member-owners get a percentage. Q: What inspired the co-op? A: It grew out of discussions within the Detroit Black Community Food Security Network. When the network was founded in 2006, one of the goals was to support existing co-ops and to create this new food co-op. So, this has been percolating for 17 years. It grew out of the desire of members of the network to push back against extractive economic practices we see in Black communities within the food realm. There is only one Black-owned grocery store in Detroit – Linwood Fresh Market – and that is very recent. For a city that has an African American population of 80%, to have other ethnic groups owning almost all of the retail food outlets in the city and extracting those profits from the city just isn’t right I don’t want to overgeneralize. Some of the stores are doing a good job at community partnerships and some are not. But the desire is to push back against an economy where others come in and set up stores and use the profits for their communities and families. We want to keep the profits and decisions here in our community. A co-op is one of the best ways to contribute toward a circular economy. Q: Why do you think the co-op is critical from a business perspective? A: The co-op model is an important model that has historically been used by Blacks and others marginalized by the mainstream economy. It broadens the ownership base and by doing that, those member-owners provide some of the financing for the business as well as receive some of the profits. So it’s a model that is more accessible to low- and moderate-income community members who don’t have access to the capital. Q: Does this create job opportunities for those in the community? A: Yes. We are expecting the grocery store to create more than 40 new jobs. Above the store, DBCFSN will operate a banquet hall and kitchen facilities that will create more. An important piece of the kitchen facilities is that they will be available for rental, which we hope will inspire food entrepreneurs to step into this arena, and those doing it to scale up their businesses. So yes, the vision is to create specific jobs at the store and to stimulate new and existing food businesses. Q: What is the economic impact on the community? A: I can’t give specific dollar amounts, but generally what happens when a business like this opens, it creates new jobs in the community. And now you have more people in the community with income being spent in the community. We are expecting that in this way the presence of the co-op will stimulate the economy in the area. We are also already seeing an increase in property values, which is a mixed blessing. We want to revitalize this community, which has seen distress, but at the same time, we need to make sure that development happens in an equitable way and doesn’t push out existing residents. This is a dilemma we are faced with. Q: Do you think this acts as an example for others in Southeast Michigan to replicate? A: One of the things we know is that Detroit is in some ways the canary in the coal mine. Detroit is an example of what happens as the economy shifts from industrial to more information-based. We are acutely aware that Detroit is being watched by the world. So as we develop this and other programs, we are certainly creating a model that’s being watched globally, so we move with that awareness. I hope this model is replicated around the world. Q: How will the co-op educate the community about sustainability? A: An important part of the co-op will be community education. We are concerned about nutrition and health and also the health of the planet because they are bound together. So we have a number of activities that will be geared toward educating community members about issues related to the food system, how the
Working to Sequester Carbon Within Urban Wood
According to Tiffany Giacobazzi, Ann Arbor urban forestry & natural resources planning coordinator the Ann Arbor Forestry Department, the city of Ann Arbor loses about 600 trees per year. This reduces its carbon storage capacity dramatically. Much of the loss sits within furniture-grade urban lumber, meaning the trees can be repurposed for furniture or other long-lived urban wood goods that aid in sequestering carbon, versus being used for mulch or firewood or being diverted to landfills. Ann Arbor has partnered with Urban Ashes to implement its Circular UrbanWood Triconomy™ (CUT Model™). This model is meant to ensure that logs are put to their highest and best use to sequester as much carbon as possible. SBN Detroit spoke with Paul Hickman, Urban Ashes founder, CEO, and principal designer, and Tiffany Giacobazzi, Ann Arbor urban forestry & natural resources planning coordinator, to find out more. Q: What is Urban Ashes, and how did this program with Ann Arbor come to be? Hickman: I will provide a little background here for context because Urban Ashes has gone through a bit of an evolution. Initially, it started with a major career change for me by taking a job in California with one of the first sustainable lumber companies in the world. I eventually moved back to Michigan and started the original Urban Wood Project with three others in the early 2000s in response to the infestation of the emerald ash borer to help utilize trees beyond mulch, which was the most common response for the disposal of ash trees then and now. That was the impetus, but it immediately expanded to include all fallen urban trees and into Urban Ashes. Urban Ashes grew to sell to over 250 retail partners across 43 states over ten years, repurposing hundreds of tons of lumber into picture frames, furniture, and other items. From the beginning, our focus was also to work with formerly incarcerated individuals as a labor force, and that remains a strong component of the Urban Ashes business model today. Over time, the lack of wraparound (support) services (for workers) took a heavy toll, and eventually, we shifted entirely, shut down our manufacturing, and decided we needed to focus on building the infrastructure to develop the supply chain more thoroughly and consistently and grow the markets for utilization as well as develop the critically needed wraparound services needed for our target labor pool. So, we partnered with NextCycle Michigan and went through their FLOWS track which led to an EGLE grant. Then came the vision for the Circular UrbanWood Triconomy™. We were fortunate enough to work with the University of Michigan graduate students for 18 months to validate the viability of the model, and beginning in 2021, we have piloted it with the city of Ann Arbor. Q: How and why did the city of Ann Arbor come to change the way it processes trees and work with Urban Ashes? Giacobazzi: As the city has shifted with its sustainability goals and A2Zero plan, we started to look at how we could divert more out of the waste stream. We wanted to achieve the highest best use for materials that come out of the urban forest. So, we connected with Urban Ashes and partnered on this project. I have support all up and down the line from city administration which is really important. We are fundamentally changing the way we are dealing with urban wood and our urban forest so we must all be in support of this new process. Q: What does this program involve? Hickman: For years, all fallen urban trees in Ann Arbor (as is the case with most cities) were used for mulch or firewood. Accordingly, Ann Arbor loses approximately 1,111 metric tons of carbon every year and we were able to show them that by implementing the CUT Model™, we can capture upwards of 700 metric tons of that 1,111 and keep it in use and sequestered. The process involves cutting the trees down in a way that holds the most carbon and is best suited for the mills. The process also involves setting up the mills, facilities, contracts, and tracking methods, and then implementing everything. So, that is the work that Urban Ashes has been doing. Q: What do you, as the Urban Forestry and Natural Resources Planner, hope to achieve through Circular UrbanWood Triconomy™? Giacobazzi: I want to make sure the trees and lumber that have to come out in Ann Arbor go to the best use possible. I want it diverted from the waste stream and we are looking to lock up the carbon for as long as possible. We put such time and effort and thought into the development, care, and maintenance of our urban forest, it seems that the next natural best step is to complete the lifecycle of these trees and extend the usefulness of the trees once they die or have to come out. Q: In what ways has the lumber from Ann Arbor been repurposed? Hickman: Typically, the lumber goes to mills to be cut into slabs or dimensional lumber, kiln-dried, and processed, and then is sold as raw lumber to manufacturing or local woodworkers. The wood is then used for items such as furniture, frames, ceiling/wall cladding, flooring, household trim packages, decorative pieces, and more. Q: What other cities are you working with? Hickman: We are farthest along with Ann Arbor. But we are also working with Grand Rapids and are in talks with Detroit, Lansing, Traverse City, and several others outside of Michigan. In terms of businesses, we are working with a startup through Centrepolis called Lily Pad Labs out of Holland, Mich., to provide urban black locust for decking and tables for their autonomous electric boats. We are also working in conjunction with Centrepolis to help bring Daika Wood’s game-changing urban wood waste processes and products to Michigan. These are a few of the things we have happening at the moment. Q; In what ways do you think Urban
Gulay Serhatkulu, Setting the Right Priorities for a Climate Neutral and Circular Future
SBN Detroit interviews Dr. Gulay Serhatkulu, BASF Senior Vice President of Performance Materials North America. This business encompasses the entire materials know-how of BASF regarding innovative, customized plastics under one roof and is globally active in four major industry sectors – transportation, construction, industrial applications, and consumer goods. Serhatkulu joined BASF in 2006 as a technical service representative. She has held a variety of roles with increasing responsibility within BASF including product management, marketing, sales, strategy, and most recently procurement. Before BASF, she earned two postdoctoral appointments at the University of Nottingham, UK, and Wayne State University, respectively. Serhatkulu shares with us some insights on the projects, goals, and challenges she leads every day. Q: What is involved in your role in leading the sustainability team at BASF in the North American region? A: Plastics do have proven benefits during their use phase – for example, preservation of food loss, lightweight construction of vehicles, and building insulation. Plastic waste, however, and in particular plastic waste in the context of marine littering, is perceived as a major global challenge. There is also increasing regulatory pressure regarding recycling quota and recyclability on the one hand and strong commitments of our customers towards increasing the share of recycled material in their offerings on the other hand. Solving these challenges requires innovation and joint efforts globally across the value chain. A team across BASF has taken up this challenge and developed the ChemCycling™ project which focuses specifically on transforming plastic waste into a raw material using pyrolysis, a thermochemical process. The raw material can be fed into the existing assets to create new chemical products with excellent product performance based on recycled plastic waste. Besides ChemCycling, BASF offers other mass-balanced chemical or advanced recycling solutions based on different post-consumer and post-industrial feedstocks. In this case, the recycled feedstock is not a pyrolysis oil and is introduced as an intermediate during the manufacturing process and not at the very beginning as is the case of pyrolysis oil. Chemical recycling represents an exciting business opportunity for us and our customers, as the resulting products are of equal quality to the products derived from fossil feedstock. Nevertheless, many technical, economic, and regulatory questions have to be answered but we are eager to work on it and optimistic that we can cope with all challenges. Q: What are you currently working on in terms of sustainability for BASF? A: One great example is the BASF and Steelcase collaboration on the brand’s new Flex Perch Stool, which has sustainability and circularity at the forefront of its design. This is the first furniture product for Steelcase that uses plastics derived from a chemical or advanced recycling process. The stool is made with BASF’s Ultramid® B3EG6 Ccycled™, an injection moldable polyamide (nylon) 6 that utilizes material from a waste stream generated during electronics production and is a one-for-one replacement for the 100% fossil-derived plastics. I cannot stress enough the importance of value chain partnership to achieve these types of major breakthroughs. From a lightweight perspective, I can also point to a collaboration with Toyota on their Sienna. We also work with footwear companies to provide plastic and foam materials that have sustainability benefits such as being bio-based and recyclable. The new Sienna generation first-of-its-kind third-row free-standing seat backs. We also have efforts for Climate protection. Climate change and global warming are among the most pressing challenges of our time. On our journey toward climate neutrality, we have set ourselves ambitious goals and are striving worldwide to achieve net-zero CO2 emissions by 2050. At the heart of the long-term transition toward net-zero CO2 emissions by 2050 is the use of new technologies, which will replace fossil fuels such as natural gas with electricity from renewable sources. Additionally, we engage our suppliers in our ambition to serve our customers with the lowest carbon footprint materials possible. In our Supplier CO2 Management Program, we first aim to achieve transparency on the product-related CO2 emissions of our purchased raw materials. In this phase, we offer our support and share our knowledge on Product Carbon Footprint valuation methodologies and tools with our suppliers. Q: What are your longer-term goals there? A: We want to live up to our purpose: We create chemistry for a sustainable future. We are only successful if our products, solutions, and technologies add value to society. Therefore, we want to make a positive impact on society and safeguard our planet. To drive the sustainability transformation, we focus on three key topics: Climate change, Circular Economy, and a safe and sustainable portfolio. We are striving worldwide to achieve net-zero CO2 emissions by 2050. Q: What are the challenges you face? A: I see two main challenges. First, new technologies like electrically heated crackers, electric steam generation, carbon capture, and storage technologies need to be developed to achieve our targets. Some of these will take time to develop and they will first need to be piloted before being scaled up. Second, we need a supportive and enabling regulatory framework if the transformation is to succeed. Q: From your perspective, what role does BASF as a business play in terms of sustainability for the surrounding community? A: We measure the overall impact of economic, environmental, and social aspects of our business activities with our Value to Society methodology. We take sustainable use of water and preserving biodiversity seriously. Our global target is to implement sustainable water management at all production sites in water stress areas and our connected sites by 2030. We periodically investigate our production sites around the world to revise which are located near internationally protected areas. We connect with external stakeholders and networks to discuss our sustainability strategy. One local example is Fighting Island. Owned by BASF, Fighting Island is a 1,500-acre island on the Canadian side of the Detroit River in LaSalle, Ontario. The island was historically used for storage of lime tailings, a byproduct of soda ash production, in settling beds. Since closing the settling beds in 1982, BASF’s efforts have led to native revegetation and reforestation to help prevent erosion, reduce dust, increase wildlife habitat, control runoff, and enhance
