Page 131 - Sigmaroc Annual-Report 2023

reduce operating costs, especially as renewable electricity becomes increasingly inexpensive. Renewable energy installations will have the additional benefit of reducing the Group’s dependence on the electricity grid, thereby providing some comfort from any future energy price fluctuations and reducing any exposure to carbon pricing mechanisms.
Strategy to capitalise
SigmaRoc has published targets for 100% of third-party energy to be sourced from renewable sources by 2030. As part of the target, the Group is currently reviewing site and virtual power purchase agreements (PPAs) across each business, and businesses will continue to expand renewable generation. The Group has an established programme of wind and solar installations to generate renewable electricity, including existing solar photovoltaic capacity at Soignies and installations at Miedzianka and Wolica (Poland) and Dimension Stone (West) during 2022. Wind turbines have been installed at Soignies, and a successful feasibility study was undertaken for windmill construction at the Dimension Stone (West) site.
3. Increased market share in products aiding the transition to a green economy
SigmaRoc is well-placed to capitalise on the net-zero transition. Lime is a key resource for the green transition, with various applications such as for the production and recycling of lithium batteries, decarbonisation of construction and as natural carbon sinks. Additionally, SigmaRoc has developed a range of low-carbon products, namely Greenbloc low-carbon concrete. By replacing 100% of cement with alternative materials, Greenbloc products have substantially reduced curing times which reduce energy consumption and carbon emissions. Similarly, SigmaRoc is currently developing concrete blocks that sequester and permanently store waste CO2.
Development of such product ranges may increase access to new clients and markets, as the demand for climate- friendly construction materials grows. This opportunity may be expected to manifest in the medium-term, although it depends on the extent to which national regulations keep pace with the green transition.
Strategy to capitalise
Continue to focus on expanding market-share of low- carbon products. Align offerings with evolving climate- friendly construction demands, with medium-term impact contingent on regulatory advancements.
4. Resilience through innovation
Overall there is a significant opportunity for the Group to continue to trial innovations in order to build and maintain climate resilience. The specific financial impacts will vary depending on the nature and outcomes of the trial, for example renewable energy programmes may help to reduce operational costs and thereby increase operating margins, whereas product-related trials may identify new product lines that may generate additional revenue.
Strategy to capitalise
Continue to target cost reduction and revenue generation through innovation trials and renewable energy initiatives. The Group anticipates that the return on investment in alignment of new and existing operations to new and more efficient machinery will be short. Additionally, as a Group
comprised of many small business units, SigmaRoc can be more dynamic and reactive than peers.
Metrics & Targets
SigmaRoc currently reports mandatory energy consumption, scope 1, scope 2 and Business Travel emissions for its UK- based operations as required under UK SECR regulation, alongside voluntary energy consumption and scope 1 emissions across its European operations in excess of SECR requirements. As part of the SBTi submission, SigmaRoc has also undertaken efforts to estimate its scope 3 footprint, establishing a team responsible for collecting and monitoring emissions data going forward. Reporting of scope 3 emissions is expected to become more comprehensive as greater confidence in data is achieved.
The specific metrics used to monitor each of the climate- related risk and opportunities are noted in the relevant tables above. In addition, SigmaRoc reports against industry-specific SASB metrics including air emissions, water consumption and biodiversity impacts (see pages 109-110), as well as additional metrics to satisfy MSCI and other ESG rating agency requirements (see page 94).
As SigmaRoc is exposed to the European Union’s Emissions Trading Scheme, additional internal carbon prices are not applied. However, this will remain under review and the use of internal prices in the coming years will be considered as necessary.
In 2021, SigmaRoc launched its Road Map to Net Zero, committing the Group to achieving Net Zero across its operations (Scope 1 & 2) by 2040, through the following:
• 2025 – All concrete products available in low carbon and ultra-low carbon
• 2025 – Carbon Capture Storage and utilisation trial plant operational
• 2025 – 100% of all manufactured products can utilise waste/recycled materials (Where industry specifications allow for it)
• 2027 – 100% utilisation of all production materials
• 2030 – Alternative fuels used mobile equipment
• 2030 – 2.5% reduction in energy intensity compared to the 2021 baseline
• 2030 – 100% third party energy sourced from renewable means
• 2032 – Alternative fuels used fixed equipment (e.g. lime and asphalt)
• 2038 – All kilns are carbon neutral
In 2023, SigmaRoc submitted its net zero (Scope 1 and 2) by 2040 target to the SBTi, which is currently under review by SBTi.
Delivery of the Road Map to Net Zero was a corporate objective linked to executive remuneration in 2022, and inclusion of climate-related metrics within the remuneration approach going forward will be established for 2024.
131