Woolworths Group Ltd (ASX: WOW) has made a step towards its carbon emissions targets, signing its first renewable power purchase agreement. At the time of writing, the Woolworths share price is up 1%, with shares in the company trading for $43.35.
Woolworths shared the news of its power purchase – which will cover 30% of Woolworths' supermarket's electricity use – yesterday.
According to the group, its energy needs make up around 1% of Australia's total energy use. Woolworths Group is aiming to be powered entirely by renewable energy by 2025.
Let's take a closer look at Woolworths' news.
Renewable power purchase agreement
Woolworths has signed a 10-year agreement with CWP Renewables to purchase power from the new Bango wind farm – located near Yass, NSW.
The agreement will see Woolworths paying to put 195,000 megawatt hours of renewable electricity into the NSW electricity grid each year. By doing so, it will avoid the release of 158,000 tonnes of carbon emissions annually.
Woolworths already has a network of 140 rooftop solar panels scattered around Australia.
The retail giant is aiming to cut its carbon emissions by 63% by 2030 and by 100% by 2050. It's already reduced its emissions by 25% since 2015.
Woolworths is one of a handful of ASX companies to have its emission reduction targets backed by the United Nations Science-Based Target Initiative, which aims to limit global warming to 1.5 degrees.
Woolworths stated it plans to continue searching for opportunities to directly invest in renewable power purchases.
The Bango wind farm will begin producing power for Woolworths in early 2022.
Commentary from management
Woolworths Group's director of format, Rob McCartney, commented on the power purchase agreement:
Going beyond net carbon neutral, we've committed to take more carbon out of the atmosphere than we produce by 2050 and our first renewable power purchase is a key milestone in that pursuit.
Supermarkets are particularly energy intensive to run and we want to use our scale for good by supporting the transition to renewable electricity.
Woolworths share price snapshot
The Woolworths share price has been performing well on the ASX lately.
Currently, it's 7.27% higher than it was at the start of this year. The Woolworths share price has also gained 17.27% since this time last year.
The group has a market capitalisation of around $54 billion, with approximately 1.2 billion shares outstanding.
