Sustainability Report 2021

CLIMATE ACTION

CLIMATE ACTION Sustainability Report 31 Working greener and cleaner We’re taking action to reduce absolute carbon emissions from our operations, our supply chain and the homes we build, and adapt our operations and approach to tackle a changing climate. 20% OPERATIONAL CARBON REDUCTION PER HOME CONSTRUCTED SINCE FY19* Our goals • To bring climate change resilience in development design, throughout construction and lifecycle • To align our business carbon reduction aligned to limiting global warming to well below 2 o C. Our progress in FY21 • Overheating mitigation techniques considered as part of an external report and internal analysis of development • Committed to set science-based targets via the SBTi and joined the Race to Zero • 19% absolute reduction in Scope 1 & 2 market-based emissions between FY19 and FY21 Our commitments to net zero and 1.5 O C During the year we made a public commitment via the Science Based Targets initiative (SBTi) to set science-based carbon emission targets aligned to the need to restrict global temperature increases to 1.5 O C. This means we will be setting revised carbon emission targets in FY22. We also signed up to the Race to Zero committing to be a net zero business before 2050. Performance During the year our scope 1 & 2 carbon intensity (market based) was 1.12 tonnes per home completed (1.37 tonnes per 100m 2 , an 18% reduction compared to FY19). Absolute scope 1 and 2 emissions (market-based) increased 20% compared to FY20, reflecting the post-COVID change in productivity and abnormally low construction activity in FY20 due to lockdowns at the pandemic’s height. You can see further figures on our operational carbon emissions in the appendix of this report. Carbon intensity 2.00 1.5 1.00 0.5 0.00 1.36 1.36 FY19 1.61 1.52 FY20 1.19 FY21 1.12 Scope 1,2 (location-based) and scope 3 business travel in private vehicles per home completed (tCO 2 e) Scope 1,2 (market-based) and scope 3 business travel in private vehicles per home completed (tCO 2 e) *Operational carbon includes scope 1, scope 2 (market-based) and scope 3 business travel in privately owned vehicles Our wider carbon footprint We have started to analyse our scope 3 footprint, meaning those indirect emissions over which we do not have full control. The greatest contributions to our total carbon footprint are overwhelmingly purchased goods and services, and the use of the homes we sell over their lifetimes. During the year we worked closely with our largest supplier of building materials by spend for greater footprinting accuracy based on our buying decisions and the credentials of individual products with less reliance on use of industry averages for calculations. Reducing diesel use, natural gas and increasing renewable electricity Diesel use in construction equipment is a major contributor to our direct carbon footprint, and with the ending of the preferential ‘red diesel’ duty rate in FY22 its use will also increase costs. We have trialled a battery assisted generator on our Doncaster Lakeside development showing significant diesel reduction potential of up to 90%, compared to our standard generators, when combined with energy efficiency improvements to site operations. During the year we moved all remaining electricity consumption over to renewable tariffs. We are now reporting 10.73 tCO 2 e from non-renewable tariff electricity for the early part of the year on a market-based method, and anticipate this figure to be zero in our FY22 reporting. Sustainable travel Our company car scheme was updated for improved access to EV and hybrid options, doubling the number of these vehicles available to staff, and installing EV charge points at offices. We reduced our emission cap for company cars from 185g/km to 150g/km, with an annual review process for progressive reductions. Our Agile Working Policy brought UNDERSTANDING CARBON SCOPES Scope Description % of total carbon footprint Scope 1 Direct emissions including use of gas oil diesel and natural gas. tCO 2 e 1.299% 3,742 Scope 2 Emissions from purchased electricity (market-based) 0.004% 11 Scope 3 7 Indirect emissions mainly (but not only) from the materials and services we purchase and the use of homes we sell over their lifetimes. 7 *NB Scope 3 emissions are still under review with significant uncertainty associated with: in at the beginning of the pandemic continues, reducing employee commuting by an estimated 8.6 million miles and business travel by an additional 950,000 miles with wellbeing and productivity benefits. “I love that the Agile Working policy allows you to make your own choices and do what works best for you (plus reducing my monthly emissions is always a good thing).” Ramona, Keepmoat Glasgow Specifying low embodied carbon products Our expectations of a sustainable supply chain are outlined in our Sustainable Procurement Policy, and we joined the Supply Chain Sustainability School as a partner during the year to enhance supply chain engagement. During FY21, we ordered 4.3 million low carbon Marshalls bricks. These are 50% lower embodied carbon than a traditionally fired clay brick and are manufactured with a low cement content. We also completed a successful trial of warm mix temperature asphalt, which has 10% less embodied carbon when compared to the traditional hot mix product, with no compromise to cost or performance. Visit //keepmoat.com/corporate/sustainability for more detail on our carbon reduction plans. 98.697% 284,380 • the use of spend based methods to calculate emissions from purchased goods and services where specific material and service data is currently unavailable • changes to the scale and pace of decarbonisation of electricity and gas networks influencing the lifetime emissions of homes constructed