Rolls-Royce outlines plans for net zero emissions by 2050
LONDON, June 17 (Reuters) - Britain's Rolls-Royce (RR.L), which makes engines for planes and ships, outlined plans to reach net zero emissions by 2050 through investing more in decarbonising technologies and, in the short term, using more sustainable aviation fuel.
Major companies are under increasing pressure from investors and climate change activists to report the emissions that result when customers use their products.
Rolls-Royce chief executive Warren East said that made decarbonising a particularly "challenging task" for the company given the current use of fossil fuels in its products and the increasing demand for power globally.
But he said it was also a commercial opportunity as Rolls-Royce outlined plans for all its new products to be compatible with net zero targets by 2030, en route to achieving net zero by 2050 at the latest.
To ensure it reaches that target, the company said it will lift its research and development spending on low carbon and net zero technologies to 75% of its total budget by 2025 from about 50% now.
The company spends over 1 billion pounds annually on R&D, although that fell in 2020 from 2019 as the pandemic strained Rolls-Royce's finances. East said that figure would grow as aviation recovered.
In the aviation sector, its biggest business, Rolls-Royce plans to make all its commercial engines compatible to run on 100% sustainable aviation fuels (SAF), which produces up to 70% less carbon than conventional fuel, by 2023.
The challenge for SAFs is that there is a shortage of supply. East said for that help was needed.
"We see a huge role for governments here in terms of policy," East told a media call on Thursday.
In the longer term, Rolls-Royce is also working on less carbon-intensive hybrid, electric or hydrogen options.
"We're in the process of discussing hydrogen with Airbus now," said Chief Technology Officer Paul Stein.
By the mid-2030s, he said the company could also look to use its small modular reactors to produce an e-fuel, which could eventually replace sustainable aviation fuel.
Our Standards: The Thomson Reuters Trust Principles.