Ayala is cognizant of our impact on the climate and its effects on both the local and global biomes. We espouse principles that value the environment as we recognize its important role in our sustained growth as an organization and in building a better future for the society. In line with our values, we ensure to keenly monitor our environmental impact through our GHG emissions while proactively protecting biodiversity in the Philippines through our comprehensive initiatives.
TCFD Strategy and Metrics and Target Pillars
Despite the decline in overall human activity due to the rolling lockdowns and quarantines around the world, GHG emissions only experienced a brief drop before rising rapidly back into pre- COVID levels. Our own emission levels have also been reduced because of local quarantining protocols, which gave us insight into strategies we could adopt to help reduce our overall emissions in the future. We are proactive in mobilizing our business units to address our climate impact by espousing three key strategies:
Recognizing the need to transition to a low carbon economy, AC Energy is taking a phased divestment strategy for its thermal assets. This supports their Long-Term Portfolio Mix Roadmap published in its Environmental and Social Policy Statement. Moreover, the demand for renewable energy resources is increasing and AC Energy aspires to be a regional leader in this space. Within the group, select business units like Globe, BPI, Manila Water, and Ayala Land have begun purchasing renewable energy directly from AC Energy through its retail electricity supply arm. As part of its resource planning, AC Energy is committed to increase it renewable energy portfolio to 5GW capacity by 2025.
Ultimately, Ayala recognizes that climate change has severe physical impacts like flooding, rising sea levels, drought, rising temperature, and extreme weather events. These can have high economic damage and we continue to take this as an opportunity to further make our businesses resilient. To know more of our commitment to the TCFD Framework, please see our TCFD Roadmap here.
According to the World Wildlife Organization (WWF), the Philippines is a biodiversity hotspot, meaning it is one of the richest places in the world wherein there is a large amount of diversity among the inhabiting species. As a peninsula, we harbor a plethora of unique endemic species in our islands, and being part of the Coral Triangle, we have some of the widest assortment of marine life on Earth. Ayala leads in the proactive preservation of our country’s biological riches, which gave birth to our flagship conservation program Project Kasibulan.
With the diversity of our businesses and broad geographic reach of our operations, Ayala recognizes that we must always be aware of how we affect the environment. We commit to giving positive impact to biodiversity in our operations, projects, activities or facilities. We shall continue to monitor our outputs and report them in a fair and transparent manner. We endeavor to create and implement projects that will manage our greenhouse gas emissions as we strongly support the government's national re-greening efforts.
Climate change has far-reaching implications beyond its influence on global weather patterns as it has profound and permanent effects on life in the biosphere. For Ayala, it is not enough to address the climate crisis as merely a target to reduce emissions within a few years, rather, we believe in a holistic approach which includes preserving and protecting biodiversity. In doing so, we hope to create sustainable systems to mitigate Climate Change and its threat to Biodiversity that withstand the test of time.
Lockdowns and extended quarantines in 2020 gave opportunities to reduce our overall usage of our utilities and ultimately lower our total consumption of electricity and water. For 2020, our total electricity consumption decreased by nine percent while our water consumption decreased by three percent. However, some of this reduction can also be attributed to the resource-saving initiatives by some of our business units. For example, 78 percent of BPI branches have installed LED lights as of 2020 and 49 percent of their total branch count have installed inverter-type of air conditioning units.
Looking specifically at Manila Water, they implemented measures to be further efficient in managing water and its distribution. In 2020, they were able to distribute close to 1,300 mcm of potable water in the East Zone Concession through their 1.2 million water service connections, effectively serving more than 8.5 million people across the areas they operate in. For more information, please refer to our report, pages 131 to 132 and pages 179 to 184. As a group, we are constantly ideating innovative and scalable solutions in increasing our resource efficiency in the coming years.
We further look at Ayala Land’s material consumption and ensure they are managed efficiently. As the business unit with the significant material consumption in its operations because of cement and rebars/steel they use in their developments, they uphold policies and practices that ensure the most efficient use of the abovementioned resources. Ayala Land keeps eco-efficiency in mind and judiciously uses energy and water by implementing efficient operational improvements
Embedded within Ayala’s environmental policies is our mandate to promote effective waste management in all our business units, incorporating it into its our diligence processes and environmental initiatives. We also observe proper protocol for the transport, treatment, storage, and disposal of hazardous waste. In our vision of creating a sustainable future, we continuously adopt best practices in handling our materials and waste products, exercising waste recycling and upcycling whenever applicable. A notable example of waste management effort in the group is IMI Philippines, who achieved a 98.2 percent waste recovery of their almost 500,000 kg of non-hazardous waste through their reduce, re-use, and recycle programs. IMI's waste recovery program involves working with their value chain for a "return-to-vendor" packaging reuse initiative. Materials such as drums and containers are repurposed on site. This extends their product life cycle and effectively prevents more waste from the municipal landfill.
Looking at the overall non-hazardous waste generated by the group, we had a reduction of 37 percent due to the impacts of the community quarantine and remote work arrangements. Meanwhile, the total hazardous waste generated increased by 13 percent, and this was driven by the contaminated waste of AC Energy. Particularly related to the pandemic, our business unit AC Health had an increase of 360 percent in their hazardous waste due to the amount of medical materials used in line with their ramped-up efforts for COVID-19. They ensured that these were handled and disposed of properly, according to standards set by DENR.
On water, Manila Water was able to treat 74.1 mcm of wastewater and through their wastewater treatment and biochemical oxygen demand (BOD) removal processes, there were able to reduce their carbon emission by approximately 74,000 tonnes carbon dioxide. Moreover, they continued desludging efforts and reached more than 84,500 septic tanks despite the logistical challenges of the lockdowns.
In July 2020, AC Energy's Power Barge 102 in Iloilo had an unfortunate accident which led to an oil spill of about 268,000 liters of bunker fuel off the Iloilo strait, contributing to Ayala's total hazardous waste for the year by 36 percent. Staying true to our commitment of ensuring that we take responsibility for our waste generated, AC Energy took measures to address the incident. The oil spill has been subsequently contained using the Shoreline Cleanup Assessment Technique conducted by a third-party service provider. AC Energy, together with the Department of Environment and Natural Resources – Environment Management Bureau Region 6, and the International Tanker Owners Pollution Federation & Brand Marine Consultants collaborated to conduct continuous monitoring of the environment through the University of the Philippines Visayas.
Beyond our own materials consumption and waste management programs within the group, Ayala is reaching out to communities through projects that encourage household-level waste recovery and recycling.
Recognizing the different materials we use and the waste we generate, we remain cognizant of our responsibility in ensuring proper waste management across the group. We continue to monitor our consumption and waste productions while implementing strategies in different levels of our business operations to minimize our negative impacts to the environment. Moreover, we extend our reach by engaging our consumers and workforce to take part in waste management initiatives of select business units.