Decarbonizing our own operations

Climate change is an immediate risk, not a future risk. To stay on a 1.5°C pathway, rapid emissions reductions are necessary.

Our product portfolio delivers the solutions necessary for decarbonization and accelerating the transition to a low-carbon economy. We empower our customers to save energy, reduce costs, and thereby boost competitiveness. We are actively building a product portfolio that maximizes energy efficiency and cost savings and helps our customers accelerate their decarbonization journey.

In decarbonizing our own operations globally, we apply the same approach that we bring to our customers. We have coined this three-step approach: Reduce, Reuse, Re-source. This is done by using the same Danfoss technologies and solutions that we develop for our customers.

Our decarbonization targets

In 2020, we took a significant step toward contributing to the goals of the Paris Agreement by committing to science-based targets. Our emission reduction targets were validated and approved by the Science Based Targets initiative in 2022. Our science-based target expands our greenhouse gas emissions reduction goals beyond our own business, across the entire value chain.

We are dedicated to achieving our decarbonization targets:

Minimum of 90% reduction of scope 1 and 2 GHG emissions by 2030 from a 2019 baseline in our own operations.
46.2 % reduction of absolute scope 1 and 2 GHG emissions by 2030 from a 2019 base year.
15% reduction of absolute scope 3 GHG emissions by 2030 from a 2019 base year.
25% reduction of scope 3 GHG emissions from purchased goods and services by 25% by 2030 from a 2019 base year.

Decarbonizing our operations

We apply a three-step approach to decarbonize our global operations.

Step 1: Reduce involves saving energy by installing energy-efficient solutions such as heat pumps where possible.
Step 2: Re-use entails recycling the energy we already have by using excess heat from buildings, processes, and data centers.
Step 3: Re-source involves turning the remaining energy green by phasing out fossil fuels and procuring renewable energy.

As a last resort, we consider climate compensation for the residual emissions that cannot be removed in any other way. We continue to prioritize energy efficiency in buildings and processes to reach our goal. We are ambitious in the use of our solutions to achieve a large part of the energy savings and have proven that applying energy-efficiency measures is good business.

In 2024, we continued to decouple our own emissions from our sales growth. With a 19% reduction in emissions and an organic growth of -9%, we are well on track to achieving our 2030 target of reducing our emissions by at least 90% compared to our 2019 baseline.

Securing renewable energy

With more than 80% of energy-related emissions coming from electricity, sourcing electricity from renewable and carbon-neutral sources is a key priority.

We are committed to purchasing 100% renewable electricity by 2030. We prioritize Power Purchase Agreements (PPAs) that contribute to the transition to more sustainable electricity grids and reinforce our long-term commitment to renewable energy. By purchasing green electricity where available, we can make the fastest and most significant contribution to climate action.

Since 2021, Danfoss has used renewable energy in our operations in Denmark and Germany through a PPA. In 2023, we entered two long-term PPAs in the US and China, which are expected to reduce our scope 2 emissions in the regions by 75% and 23%, respectively. As of January 2024, the campuses in Wuqing, China, and Chennai, India, are fully supplied with renewable electricity, and the Hayian, Jining, and Nanjing factories in China are well underway.

Carbon-neutral operations

Using our Reduce, Reuse, Re-source approach, we continue to decarbonize our operations around the world. In 2022, the Nordborg campus in Denmark, our largest production facility, reached carbon neutrality. The 250,000 m2 campus achieved neutrality through the reduction of energy consumption, reuse of excess heat from processes and data centers, and sourcing of green electricity. We focus primarily on actual emissions reductions, with only a limited use of credits and offsets. Danfoss has purchased carbon credits from a carbon credits retirement program targeting the regulated and third-party verified US Californian Cap-and-Trade market to offset remaining emissions in the Nordborg campus.

In 2024, significant steps were taken in China toward decarbonizing our factories. Within the next 1-2 years, we expect to have fully decarbonized our operations in China.

Electrification of our own fleet

Electrification of transportation is a focus area for Danfoss — both from the perspective of being a solution provider for electric vehicles and charging infrastructure and as a member of the Climate Group’s EV100 initiative.

We increased the share of electric vehicles in our car fleet from 12% in 2023 to 20% in 2024, and we are continuously increasing the capacity of on-site charging stations.

Climate action initiatives and partnerships

In 2020, Danfoss joined, as the first global technology company, all three business initiatives by the Climate Group.

Through these initiatives, Danfoss commits to sourcing 100% renewable energy (RE100), improving energy productivity (EP100), and shifting to electric vehicles by 2030 (EV100).

In 2023, we announced our commitment to the First Movers Coalition (FMC). The goal of the Coalition is to accelerate emerging climate technologies to decarbonize the world’s heaviest emitting sectors. Danfoss made the commitment to purchase at least 10% (by volume) of low-carbon primary aluminum by 2030.

About the First Movers Coalition:

90+ leading global companies
A partnership by the US State Department and the World Economic Forum
Represents EUR 14 billion in annual demand, the world's largest demand signal
The seven hard-to-abate sectors covered by the FMC account for 30% of total global emissions

Read about the First Movers Coalition

Annual Report 2024

Our integrated annual report provides a holistic view of Danfoss’ business, value drivers, strategy, governance, as well as sustainability and financial performance.

Download our integrated annual report