Sustainable procurement: an important leg of our journey to a better future

All roads lead to a sustainable Rome

The road to a sustainable future is not as straightforward as many of us would like and there is no one perfect solution that will get us there. At Purmo Group we are convinced that there are many different pathways we can take together to make a difference. We want to actively contribute to the wellbeing of current and future generations and therefore focus on the bigger picture with both short-term and long-term initiatives.

As a leading supplier of sustainable indoor climate solutions and services, we help to heat and cool millions of buildings around the world. This provides comfort for many, but also puts us in a unique position to support the creation of a better tomorrow. Seeing that 64,9% of energy consumption in EU households is used for space heating and cooling1 there is a lot of potential to reduce carbon emissions. The right heat source and related products such as low temperature emitters, smart controls, valves, etc. are clearly key elements in a sustainable future. We bring all of this together in a complete range of sustainable indoor climate comfort solutions.

It is not surprising therefore that our production and our solutions are 2 of the 4 focus areas in our sustainability strategy, along with our people and our communities. We have made clear commitments within each area and are continuously looking for ways forward. Ranging from sustainable manufacturing to volunteer work in our local communities, every effort counts and contributes to our leadership position in sustainability within our industry.

Sustainable procurement

The commitment that is especially relevant today is responsible sourcing. By changing the way we source materials, such as steel, brass, plastic and packaging materials, we want to get a clean start for a greener production and delivery process. With steel in particular, we are making great progress. Since early 2020 we have, for example, worked with steel suppliers across our production footprint to utilise stronger but thinner steel grades to manufacture steel panels that offer the same heat performance and pressure resistance. This has allowed us to reduce the amount of material and waste, as well as increase energy efficiency in the production process.

Moreover, last year we have committed to the purchase of near zero-emission steel from 2026 onwards. This steel enables the reduction of CO2 emissions by up to 95% compared to traditional steelmaking powered by coal. 2026 will thus be another important milestone and the start of a long-term commitment as we have entered into a binding agreement for the purchase of 140,000 tonnes of near zero carbon-emission steel between then and 2033. This will cover over 10% of our annual steel consumption.

Read more about our commitment to purchase near zero carbon-emission steel

In view of generating additional, more immediate impact we are now also exploring the opportunities of carbon offsetting wherever possible, starting with the production of carbon offset steel radiators. John Peter Leesi, CEO of Purmo Group comments: “We’re taking two approaches to sustainability: the first is to do the things we do more responsibly; the second is to find entirely new ways of doing them that can continue indefinitely. In steel sourcing, we’re being more responsible with conventionally produced steel, but also investing in near zero-carbon production methods for the future.”

Carbon offsetting and green steel

The term ‘green steel’ is rather popular these days. Unfortunately, it is being used quite freely for any kind of steel on the spectrum between low carbon-embodied steel and almost zero carbon-emission steel. Although we are pursuing opportunities across the entire range, we want to be very clear on what it is we are doing today and are committed to in the future.

Our current, short-term focus is on carbon offset steel. As of April we started the production of carbon offset steel electric radiators in our factory in Gateshead (UK). For this we cooperate with Arcelor Mittal, who have set up XCarb^®, a global steelmaking innovation programme targeted at carbon‑neutral steel by 2050. Their XCarb^® green steel certificates, created within the programme, allow customers such as Purmo Group to invest in a range of initiatives that reduce an equivalent amount of carbon emissions. A nice example of such a project is the capturing of hydrogen-rich waste gases from the steelmaking process and injecting them into the blast furnace to reduce the use of coal.

The CO₂ savings that arise from these initiatives are aggregated, then independently verified by global assurance provider DNV, and finally converted into XCarb^® green steel certificates. These certificates represent a reduction in the Scope 3 carbon emissions for those who buy them but also affects their customers directly as the CO₂ savings reduce the lifetime carbon impact of the products they in turn buy. For a recent purchase of 16 tonnes of steel, for example, we received a green steel certificate stating that we have saved 35 tonnes of CO₂.

Making a difference with Purmo Group

“Although we realise that carbon offsetting is just one small step towards more sustainable procurement, it is an important step in the right direction. We are aware that this is just a stopover on a long journey ahead but we are convinced that every action counts to create a better future for us, the next generations and our planet,” says Sam Hodlin, Head of Sustainability at Purmo Group.

“While some in the industry tend to limit their efforts to carbon offsetting, for us it is by no means a substitute for doing everything possible to reduce and eventually eliminate our emissions directly. At Purmo Group we have a clear sustainability roadmap, which guides us from awareness and understanding to strategy and action, as well as a long-term vision that includes a greener future for all, from industry to end user. Sustainability has become part of our company DNA and everyone within Purmo Group is committed to do his or her bit to achieve carbon neutrality.”

Read more about our sustainability strategy

Julian Stocks, Product Director for Radiators at Purmo Group, adds: “Moreover, we find that our customers are also increasingly interested in environmental, social and corporate governance (ESG). They are keen to cooperate with market leaders in the field of sustainability and attach great importance to the availability of environmental credentials such as EPDs and EcoVadis, which provide evidence of the sustainability of our products and our business respectively. Behind the scenes we are working hard on this. We are planning new EcoVadis audits, for example, and have identified software that can help us to calculate the environmental impact of our products and then create EPDs in an effective and streamlined way.” We are confident that these EPDs will be valued in all our markets.

Long-term goals

Unfortunately, the production of steel generates particularly high levels of carbon. Due to the nature of our activities we cannot omit its use, but we are committed to doing so in a carbon neutral way by 2050. We are currently looking forward to producing real green steel products once we start to receive the near zero carbon-emission steel from H2 Green Steel in 2026.

“Purmo Group is a pioneer in another important customer segment for the steel industry. They are a great example of a company that is letting its business decisions truly be guided by its commitment to sustainability and achieving the Paris Agreement. At H2 Green Steel we applaud these first-mover companies in different sectors. They really make a difference,” says Henrik Henriksson, CEO of H2 Green Steel.

Responsible sourcing will remain an important commitment for us, but on our journey to a more sustainable future we also face challenges of a different nature. We are equally proud of the great results that we have achieved over the last years on many different levels, ranging from the energy efficiency of our plants and the diversity of our senior leadership to volunteer work and sharing our expertise during local training courses.

We have also, as one of the few in our industry, set targets for reducing greenhouse-gas (GHG) emissions, which have been approved by the Science Based Targets initiative. Furthermore, we are actively pursuing other commitments related to, for example, our packaging solutions and operations. The results of which we look forward to sharing with you in the coming months and years.

Together our impact is greater

Although we are certainly determined to make a significant contribution, global challenges such as climate change impact us all and can only be countered by a joint effort. The industry, HVAC professionals and end users must all work together if we are to achieve a big win with indoor climate improvements. Together our impact is greater and we can ensure that new builds, but also the 75% of EU buildings that are not energy efficient today2, will be our heaven on earth where we enjoy optimal comfort without putting pressure on the world’s resources.

“That is also why we attach such great importance to guiding both HVAC professionals and end users in making informed choices. When we attend a fair for example, we present both installers and consumers with a complete package of product solutions, but also information about government incentive schemes, etc. so that they walk away with clear recommendations for their project. This has yielded great interest so far because there is still a lot of unclarity when it comes to the creation of future-proof heating and cooling systems,” says René Fink, Vice President Sales Central Europe at Purmo Group.

“There is also still some reluctance to use heat pumps, for example, because there are a lot of misconceptions out there,” adds Niclas Schubert, Vice President Sales Cluster North at Purmo Group. “Many people still believe that a heat pump is more costly than gas and air conditioning, but studies are starting to prove that that is not so in most cases3. As a leading supplier of sustainable indoor climate solutions we feel it is very important that all parties involved have access to the right information and solutions. Only then can we take the journey to a better future together.”

Sources:
1. https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Energy_consumption_in_households
2. https://ec.europa.eu/commission/presscorner/detail/en/fs_21_6691
3. https://climateinstitute.ca/wp-content/uploads/2023/09/Heat-Pumps-Pay-Off-Unlocking-lower-cost-heating-and-cooling-in-Canada-Canadian-Climate-Institute.pdf