The Coles Group Ltd (ASX: COL) share price is rising today after the company increased its climate change commitments to use 100% renewable energy by 2025, signing two new energy purchasing agreements.
At the time of writing, the Coles share price is up 2.12% to $15.90.
With over 2,507 large retail outlets nationally that are open long hours, Coles is a major Australian energy user. In addition, it is one of the country's largest public retail companies. Coles providing customers with everyday products including fresh food, groceries, household goods, liquor, fuel, and even financial services.
Originally Australia's second-largest retailer behind Woolworths Limited (ASX: WOW), Coles was acquired by Wesfarmers Ltd (ASX: WES) in 2007. However, it spun off from Wesfarmers in 2018 and Coles shares re-listed on the ASX at that time. As of 30 June 2018, Coles processed more than 21 million customer transactions on average each week.
What Coles' renewable energy targets mean
Coles' 100% renewable energy usage targets in just four years time. This is relatively impressive compared to the targets of some large companies. However, its more important pledge to be completely carbon neutral isn't until 2050.
Despite this, the company says it's moving in the right direction. In particular, signing two major agreements with leading renewable energy companies ENGIE and Neoen.
Coles is planning on reaching its renewable energy targets by purchasing its electricity from renewable energy providers, rather than self-generation. It was the first major Australian company to sign a renewable purchasing-power agreement in 2019.
Some progress has already made on renewable power purchase agreements. This includes onsite solar and large-scale generation certificate deals. Coles has also committed to purchasing more than 70% of the renewable electricity required to meet its FY25 target, once the agreements commence.
What Coles management said
Coles chief sustainability, property and export Officer, Thinus Keeve, said the company wants to be a pillar of Australian sustainability. He commented:
As part of our ambition to be Australia's most sustainable supermarket we've launched our new 'Together to Zero' sustainability strategy with a long-term aspiration towards zero emissions, zero waste and zero hunger.
The agreements are with some of the world's top renewable electricity companies and show we're taking a leading role in driving climate action in Australia. It puts us in a great position to be powered by 100% renewable electricity by the end of FY25.
Share price snapshot
When the COVID-19 pandemic hit and the news soon became full of empty supermarket shelves and customers fighting over toilet paper, Coles shares rocketed and rose from $15 to $18 between May and August 2020.
Since then, despite a period of relative stability to end last year, they've declined fairly significantly. In February 2021, they fell off a cliff, falling $2 in one day due to the company's poorer than expected FY21 half-year results.
The Coles share price is up 1.6% this month, but down more than 13% in 2021 so far.
