Climate Action
Transitioning Towards Climate
Positive Business
Global temperatures are believed to increase by 1.5℃ before 2040. To keep the temperature fluctuation within 1.5℃, everyone needs to play a role to reduce their emission-posthaste.
We are no different, and our role in protecting and enhancing the environment guides our operations on the ground. Sime Darby Plantation (SDP) has a target; a 50% carbon intensity reduction by 2030, leading up to our Net Zero aspirations.
Our action plan is clearly mapped out. We are actively looking to restore degraded land, protect habitats, enhance responsible agricultural practices, and develop a circular economy through renewable energy. A major part of our focus is to drive deforestation out of our supply chain, a complex ecosystem.
While SDP has faced challenges in meeting our targets to climate-positive action, we have made significant investments to accelerate our ability to achieve our targets through infrastructure to support climate change adaptation and mitigation efforts.
Protecting The
Environment
We are making efforts to minimise our environmental impact through carbon reduction and management of water, emissions, waste, and fire, as well as through our efforts to drive deforestation out of the supply chain. These measures are also integral contributors to the Sustainable Development Goals.
While Sime Darby Plantation has faced challenges in meeting our targets to reduce emissions, we have made significant investments to accelerate our ability to achieve our reduction targets through infrastructure to support climate change adaptation and mitigation efforts.
Climate Risk Assessment
Carbon Reduction
Renewable Energy
Emission Management
Fire and Haze Management
Waste Management
Water Management
Enhancing The Environment
Sime Darby Plantation operates in some of the most biodiverse landscapes in the world, including Malaysia and Indonesia, both of which maintain a 50% forest cover. Understanding the need for and importance of conserving the natural expanse, we implement environmental management practices in our operations that are targeted at reducing biodiversity loss
Land Use Management
Peatland Conservation
Reforestation and Restoration
Carbon Reduction
Our Target: 50% reduction of carbon emissions by 2030
As the world's largest oil palm plantation company by planted area, we recognise the important role we play in managing carbon emissions and improving energy efficiency across our operations, to mitigate the adverse effects of climate change.
Our current focus:
- Reducing emissions directly from Sime Darby Plantation’s operations, including land clearing and preparation, planting, fertilising, harvesting, extraction, transportation and processing of raw materials.
- Continuously working towards improving the energy efficiency of our operations
We aim to provide greater transparency on our carbon footprint by monitoring and measuring our emissions.
How we Measure our Emissions
Roundtable on Sustainable Palm Oil (RSPO) Palm Greenhouse Gas (GHG) and the GHG Protocol
Emissions from our palm oil and rubber operations are collected and calculated throughout the calendar year using the RSPO PalmGHG calculator and the GHG Protocol accounting standard. The RSPO PalmGHG calculator is used to measure emissions from land-use change (LUC) due to replanting and new planting activities. The operational emissions data is collected and calculated in accordance with the GHG Protocol accounting standard.
Emission Management
We recognise that our mill operations are challenged with significant emissions such as dust and smoke from chimneys and particles from crushing plants, unlike our refineries that operate on natural gas.
In Malaysia alone, we have invested approximately RM70 Million to improve compliance with more stringent air emission standards by installing additional pollution control systems such as Electrostatic Precipitator and Vorcep at all our 33 mills. We have always complied with local environmental regulations. With the new limits required under the Clean Air Regulations 2014, we are upgrading our pollution control system to meet Total Particulate Matter (PM) of 150mg/m3 by December 2021 (from 400mg/m3 to limit value). Individual operating units report their air emission performance through our online Continuous Emission Monitoring System (CEMS).
Fire and Haze Management
Sime Darby Plantation (SDP) pioneered and commercially introduced the 'Zero-Burning Replanting Technique' in 1985.
When clearing fields of old and unproductive palms, the trunks and fronds are cut and left on the fields to decompose as organic fertiliser. This environmentally friendly technique, improves soil quality, and has been adopted as the industry standard for oil palm replanting.
In 1992, SDP was admitted into the United Nations Environment Programme's (UNEP) Global 500 Roll of Honour for Environmental Achievement during the Rio Earth Summit for the development and commercialisation of this technique.
Fires can be caused by many factors and is most likely to occur during dry seasons. Our operations, as well as areas of our concessions occupied by local communities are susceptible to unpredictable fires.
We use satellite data to keep an eye out for fire occurrences in our estates as well as neighbouring areas. Once alerted, we immediately investigate and send our specially trained teams to put the fires out and prevent it from spreading and causing more damage.
Hotspot DashboardOur strict Zero Burning Policy extends within our own boundaries. However, because of our commitment to environmental stewardship, we have roped in our neighbours to commit to the same policy. This includes those within a 5km radius of our estate boundaries.
We not only assist our neighbours to monitor fire occurrences but also help to put out the fires as soon as we are alerted.
We have specially trained and fully equipped Fire Fighting Teams at our operations to help put out fires. They are the frontliners who safeguard our plantations and assist our neighbours as part of the 5km Zero-Burning commitment.
In Indonesia, a series of training programmes were conducted as follows:
Masyarakat Peduli Api (Local Communities Fire Awareness Movement)
Protecting the environment is a shared responsibility and who better to help us than the local communities who live and work with us.
Sime Darby Plantation has helped initiate 'Masyarakat Peduli Api' within neighbouring local communities in our Indonesian operations to increase their awareness and participation in fire prevention activities.
53 units of Menara Api are under construction and expected to be completed by end of 2021.
Since 2014, our subsidiary Minamas Plantation has partnered with seven universities across Indonesia to develop integrated community-based fire prevention programs (DMCA) involving all levels of stakeholders, to contribute in safeguarding the area from forest fires.
The programme aims to educate local communities in fire-prone villages around our operations about sustainable agricultural practices. We help them find sustainable and viable alternatives to generate income.
As of November 2021, the programme has covered 161,000 hectares and benefitted 67,000 people. Five new programmes have been initiated in West Kalimantan since 2020. Since its inception, a total of 34 villages have participated in the programme across Sumatera and Kalimantan in Indonesia.
The programme aims to educate local communities around our operations about sustainable agricultural practices. We help them find sustainable and viable alternatives to generate income.
Waste Management
Palm oil Mill Effluent (POME) is the primary organic waste generated during the production of palm oil. Sime Darby Plantation does not discharge untreated effluent into water streams as it will cause considerable environmental harm.
We maintain robust management systems to ensure all our mills and refinery operations are equipped with Palm Oil Mill Effluent Treatment Systems (POMETS) and Industrial Effluent Treatment Systems (IETS) that support the management of waste and comply with national environmental standards. We have also placed emphasis on training our employees to manage effluent and treatment systems.
Composts can be produced through a combination of the two largest constituents of mill wastes, POME and Empty Fruit Bunches (EFB), as well as other by-products, including decanter cake and boiler ash. Composts are applied in estates as a soil conditioner to enrich the soil. Sime Darby Plantation began composting as part of its mill waste management in 2004.
Water Management
Oil palm requires regular water supply to prevent tree stress. Our water management practices aim to maximise water efficiency in a way that balances our operational requirements with the conservation of water resources.
We employ measures to minimise the impact of droughts and floods, optimise rainwater and surface water use, boost the utilisation of effluents from palm oil mills, and reduce the effects of saltwater incursions and acidity levels.
We monitor our water usage for every tonne of fresh fruit bunch (FFB) processed at our mills. While our mill design ratio is 1:1 (1 MT FFB : 1m3 water), an approximate 0.2 to 0.4m3 water is used for processing materials other than FFB (approximately 20%).
This has led to further investments and initiatives to reduce water usage to a target of 1.0m3 per tonne of FFB produced by 2023. This translates to a cumulative reduction of 10% to 40% over five years. Whilst our operations in Papua New Guinea and the Solomon Islands are already operating at an average of 0.8m3 – 0.9m3, we are confident of effectively reducing our water intensity by implementing control measures on water usage at our mills.
Baseline Water Consumption Analysis
To further enhance our sustainability practices, we introduced new technologies to efficiently treat industrial wastewater in 2019 and 2020. Patent applications have been filed in Malaysia, Indonesia and Thailand on the process of treating palm oil mill effluent using electro-oxidation means and in Malaysia on the method for treating vegetable oil refinery effluent using electro-oxidation means. These efforts have made significant inroads into reducing our energy and water footprint.
Our top priority is to ensure our employees have access to safe drinking water and sanitation. We take periodic water samples from the river systems, and the results have shown no significant deterioration of water quality.
Renewable Energy
We aim to create a diverse portfolio of sustainable businesses while creating a circular economy for all the direct and in-direct stakeholders within our eco-system and beyond.
Globally, the conversations around climate change have taken centre stage with renewable energy at the forefront of solutions to reduce Greenhouse Gas (GHG) emissions. To help realise our carbon emission target, the Group set up Sime Darby Plantation (SDP) Renewable Energy Sdn Bhd in 2014 to establish ventures in co-developing our biogas plants, as well as other renewable energy initiatives such as solar and biomass.
Highlights:
SDP Total Operational Emission by Source FY2021 (MT CO2e)
Methane emissions from treating effluent mainly from mill processes, is the single largest emission source of SDP’s operations.
SDP's biogas plants initiatives are not only vital in ensuring that we remain on track towards achieving our carbon reduction target.
Our biogas plants capture methane emitted from anaerobic wastewater treatment ponds that would otherwise be released into the atmosphere. Methane is a high-impact GHG and is created when Palm Oil Mill Effluent (POME) is stored in retention ponds. The captured biogas is then used to generate power that is either fed into the grid or powers our own operations, or flared, ensuring that methane is not released into the atmosphere.
Progress of our Biogas Plants initiative:
We aim to have a total of 31 biogas plants across our operations by 2030.
In 2018, Sime Darby Plantation's (SDP) first involvement in a solar project was commissioned in our Byram Division of Tali Ayer Estate in Penang, Malaysia.
We leased out 28 ha of Byram Division's land to PLB Green Solar Sdn Bhd for its 20 MW project which commenced operations in 2019. Since 2019, the plant has realised returns from rental and revenue-share income. We have undertaken a similar approach with the Large-Scale Solar @ MEnTARI (LSS4) project, the latest development of the LSS scheme.
Currently, SDP Renewable Energy Sdn Bhd is looking for more opportunities in the solar sector to diversify its revenue base as well as to collaborate and jointly develop large scale solar photovoltaic power plants and solar rooftop projects.
In Malaysia, we have identified nine SDP buildings that can be equipped with roof-top solar panels in order to reduce electricity consumption.
In addition to large-scale solar projects, we are also identifying different business models for solar, mainly for our own consumption through Captive Power and Net Energy Metering (NEM); and a corporate Peer to Peer (P2P) model for consideration as the government further liberalises the market.
Climate Risk Assessment
We aim to provide greater transparency on our carbon footprint by monitoring and measuring our emissions to furnish accurate data on our performance.
We are continuously working towards improving the energy efficiency of our operations. We focus on emissions directly from SDP’s operations, including land clearing and preparation, planting, fertilising, harvesting, extraction and processing of raw materials. We currently do not manage emissions that are generated by third-parties who supply fresh fruit bunches.
In line with our intention to be part of global efforts to decarbonise the economy and mitigate the adverse effects of climate change, we set a target for reducing 50% of emission by 2030.
Peatland Conservation
As part of our No Deforestation, No Peat, No Exploitation commitment, we have not planted on peatland since 2014.
For existing oil palm planted on peat, we employ best management practices to minimise environmental problems. This includes monitoring water levels, fire incidents, and maintaining existing vegetation adjacent to our oil palm plantations. We also engage with local communities to educate them on sustainable management of peat areas to prevent slash and burn activities.
Land Use Management
Our large landbank enables us to meet the evolving human needs while continuing to advocate for the importance of conserving the ecological profile of our land.
We have a strict No-Deforestation policy that has been in place since July 2014. We use the High Carbon Stock Approach (HCSA) to estimate the amount of carbon and biodiversity stored in an area of land, to identify those that need to be preserved and protected.
The HCSA defines what constitutes forest landscapes in order to avoid deforestation. The methodology was developed by a broad group of companies and civil society organisations as a practical, transparent, robust, and scientifically credible approach that has become widely accepted, to implement commitments to protect forests in the tropics.
In addition to the HCSA method, we conduct independent High Conservation Value (HCV) assessments at our estates before new plantings or developments.
The assessments aim to identify HCV areas that may be negatively affected by our operations. The HCV assessments are conducted in conjunction with independent Social and Environmental Impact Assessments (SEIA) that are also carried out before new developments, including those by our suppliers. Where any loss of HCV biodiversity has been identified, we will develop Biodiversity Conservation Compensation Projects (BCCP) with Project-Affected Communities (PAC). Priority is given to in-situ remediation by planting Rare, Threatened and Endangered trees in conservation areas within Sime Darby Plantation's (SDP) operations.
We have a trained team that conducts HCV assessments in all our operating units to identify, categorise, protect and maintain high-risk zones. We also train our personnel on the ground on HCV management methods and the necessity to periodically monitor these areas to ensure the effectiveness of management activities.
SDP engages Assessor Licensing Scheme (ALS) Assessors for HCV Assessment or Integrated HCV – High Carbon Stock (HCS) Assessments for all new planting activities under the Roundtable on Sustainable Palm Oil's New Planting Procedure (NPP). This commitment is extended to all our suppliers. The reports can be accessed at High Conservation Resource Network.
New Britain Palm Oil (NBPOL) has become a member of global non-profit organisation The Forest Trust (TFT) with an initial focus on assessing and defining HCS forest areas in parallel with assessments of the needs of communities who live within our new concessions.
HCV surveillance is carried out using the annual two-fold approach, including the use of Satellite data, drones and ground truthing. All data is entered into GIS software (either SMART or QGIS) with a bi-annual remediation plan submitted where required and verified externally during annual audits by RSPO and Rainforest Alliance.
New Britain Palm Oil’s (NBPOL) West New Britain (WNB) Ltd. has implemented SMART methodology across the site. All HCV sites will have the methodology run once a year and updated into the SMART reporting tool. To date five out of nine HCV sites implemented the methodology with the last four in progress. We are currently working on rolling out the methodology in Poliamba Ltd. and RAIL Ltd.
Spot Checks are carried out using Landsat and Sentinel imagery looking to identify any areas that are disturbed or have changes in land use within HCV areas. These areas are then ground-truthed to ensure necessary remediation plans can be put in place. To date five out of nine Spot Checks have been carried out.
Two additional NBPOL sites, RAIL Ltd and Poliamba Ltd. will start using the methodology developed by WNB Ltd. in 2019.
Reforestation and Restoration
Sime Darby Plantation is committed to ensuring the restoration of degraded forests and the reforestation of areas set aside for conservation in our concession areas. Where possible, we have planted Endangered, Rare and Threatened (ERT) trees to create wildlife corridors linking patches of degraded land. Together with our partners, we have collectively planted 1,531,972 trees to restore the habitats of endangered species.
| Our tree planting efforts include the following: | |
|---|---|
| Reforestation and Rehabilitation of Orangutan Habitats in Northern Ulu Segama, Sabah, malaysia. | 295,158 trees |
| Sime Darby Plant-A-Tree Programme in Sime Darby Plantation estates, Malaysia | 329,225 trees |
| Sime Darby Plant-A-Tree Programme in Jenter Estate, Pahang, Malaysia | 136,036 trees |
| Project RiLeaf with Nestle Malaysia | 588,981 trees |
| Peat Swamp Forest Protection and Rehabilitation Project in Raja Musa Forest Reserve, Bukit Talang estate, Malaysia | 18,500 trees |
| Riparian and coastal reforestation, Papua new Guinea | 69,911 trees |
| Ramu Tree Nursery, Papua New Guinea | 96 trees |
| Mangrove restoration Numundo Coastline, West new Britain, Papua New Guinea | 10,914 trees |
| 2020 - SDP Plant-A-Tree Kamuning Estate, Anak Kulim Estate (Polinea planting), West Estate (Foresty Selangor), and Sarawak Region (UPM and Forestry Sarawak) | 83,150 trees |
For more information, visit Yayasan Sime Darby.
Sime Darby Plantation pledged to assist the State Government of Sabah (represented by the Sabah Forestry Department) to conserve Orangutan habitats at the Bukit Piton Forest Reserve (previously known as Northern Ulu Segama). Bukit Piton is part of the Ulu Segama Malua Forest Reserve in the Heart of Borneo. The programme started in 2008 when an agreement was signed between the two parties to rehabilitate and restore the entire 5,400 ha of Bukit Piton Forest Reserve over a 10-year period, with a total commitment of RM25 million funded by Sime Darby Foundation.
About 300,000 trees from more than 95 species were planted in the area, also supporting the regrowth of natural vegetation. The trees and vegetation serves as food sources for Orangutans and other wildlife in the area. The project was successful, with multiple sightings of a large number of Orangutan nests in the rehabilitated areas. The success also included the reclassification from Class II Commercial Forests to Class I Protection Forests. It was renamed Bukit Piton Forest Reserve in March 2012 and had acquired the Totally Protected Area (TPA) status, which helped to improve the ecological functions of the forest.
The project was completed in 2018 and handed over to the Sabah Forestry Department during a closing ceremony held on 8 December 2018.
Sime Darby Plantation (SDP) collaborated with Sime Darby Foundation, the Management and Ecology of Malaysian Elephants (MEME) and the University of Nottingham Malaysia (UNM) to conduct research and obtain information on Human-Elephant Conflict (HEC) found in our Malaysian operations from 2011 to 2018.
This collaboration between the private sector, academia and the conservation world is a pioneering step for SDP to establish the science that can help manage HEC issues and protect wildlife while continuing to deliver value for the business. We have also established a standard operating procedure for human-wildlife conflict mitigation in the plantation.
Sime Darby Foundation has committed RM2.85 million to support MEME for the next three years (2020-2022) to develop conflict management approaches that cater to smallholders and other growers. This grant will assist in the development of a science-backed mechanisms to support the co-existence of human beings and endangered species.
This marks an overall contribution of RM8.11 million by the foundation since 2012, towards research and conservation management of wild Asian elephants.
Case Study SOP for Human-Wildlife Conflicts Mitigation in PlantationWe recognise that our plantations are habitats for diverse species that are endemic to the locations we operate in. Our plantations are also migratory corridors for wildlife that roam the forests. Thus, efforts are in place to connect some of these important wildlife corridors. For example, our operations in Papua New Guinea are home to the Queen Alexandra's Birdwing Butterfly (QABB) (Ornithoptera Alexandrae). The QABB is the world's largest butterfly, with wingspans of between 19cm and 30cm. It is endemic to northern Papua New Guinea, east of the Owen Stanley Mountains, and has an extremely small home range. The QABB is commonly found in Papua New Guinea's lowland rainforests, up to 900m above sea level. It mainly feeds on Aristolochia Dielsiana, a toxic pipevine species that plays a central role in its reproduction.
Through ongoing assessments, we have identified various species that are on International Union for Conservation of Nature (IUCN) red lists in our Papua New Guinea operations. We shall continue efforts to monitor and manage the species currently present in our plantations to ensure ecosystems continue to be protected.
With support from Sime Darby Foundation, a special lab has been constructed to facilitate the captive breeding of QABB. We aim to enhance the remaining population of this rare species by releasing adult bred specimens into areas of remaining forests where the pipevine plant is known to grow.
Tucked away in our Carey Island operations is Malaysia's first mangrove research centre that Sime Darby Plantation (SDP) established in 2019.
Located within the Company's West Estate, MRC is the research platform on the mangrove ecosystem and coastal zone management.
Among the objectives of the research centre are:
- To conduct phenology studies on mangroves seedlings available in and around Carey Island.
- To collect, establish, raise and manage mangroves nursery at Mangrove Research Centre, Carey Island.
- To plant, install and test the saplings using various methods at the eroded river buffer zone.
- To monitor and evaluate the survival and growth rates of the planted saplings.
- To expose and elevate the competency of internal researchers on mangrove science.
The latest project the centre is focusing on is the Carey Island River Rehabilitation Project. SDP's team has been planting Mangrove tree species to address major issues the island faces, including bunds breaking, riverbank erosion and mangrove degradation.