MHI Greenwashing Tactics Demand Closer Scrutiny
Photo: Shutterstock/Dmitriy Prayzel
07 June 2023 – by Tim Daiss
Last updated on 13 June 2023
Mitsubishi Heavy Industries’ (MHI) greenwashing tactics are gaining momentum. Recently, it said it would reach carbon neutrality by 2040 across all its vast sectors, geographical locations and subsidiaries.
Many mistake MHI for renowned Japanese automaker Mitsubishi Motors, which holds a steady grip on the global auto sector. However, MHI is a part of the Tokyo-based international conglomerate Mitsubishi Group, one of the world’s 50 largest corporations.
Mitsubishi Group’s operations span a large array of companies, subsidiaries, industries, sub-sectors, countries and regions from Asia to North America, Europe, and Africa. It’s also Mitsubishi Motors’ parent company.
MHI also has its hands in a plethora of industries and sectors, consisting of some 300 domestic and international companies. Products include aerospace and automotive components, air conditioners, elevators, forklift trucks, hydraulic equipment, printing machines, missiles, tanks, power systems, energy, ships, aircraft, railway systems and space launch vehicles.
A Major Natural Gas Player
It also exports gas-turbine power plants to about 20 countries, mainly in Southeast Asia, the Middle East, Europe, North America and South America.
MHI Carbon Neutrality
However, MHI still claims its overall operations are on a path to carbon neutrality. It set what it calls “Target Year” in 2030 to reduce CO2 emissions across Scope 1 and 2 by 50%, compared to 2014.
Part of its 2030 goals also includes reducing Scope 3 CO2 emissions across its enormous value chain. Emission reductions will largely come from carbon capture utilisation and storage (CCUS) technology, which will reduce emissions by 50% by 2030 (compared to 2019 levels).
Its 2040 goals call for net-zero emissions across MHI Group and its value chain.
MHI’s Self-serving Pledge
However, taking MHI’s carbon neutrality goals at face value is challenging as the company will continue to operate fossil fuel power generation plants. As such, there are two outstanding problems with MHI’s climate change mitigation pledge.
Firstly, it’s self-serving. Instead of setting specific dates for the closure of coal and gas-fired power projects, MHI President Seiji Izumisawa said in November that Asia must gradually phase out coal power. He added that this will happen while still using existing infrastructure to make the shift to a carbon-neutral society less disruptive.
However, any plans to continue using coal-fired power generation, given its enormous emissions footprint, isn’t a less disruptive shift. It’s still categorically harmful.
Secondly, relying on carbon capture technology to justify further gas-fired power development in Japan and abroad misses the mark. It not only keeps MHI from divesting its cost-intensive gas power assets but tries to cover future emissions from fossil fuels with a technology that’s still largely unproven on a large scale. A growing number of critics agree that carbon capture is not the way forward.
A Leading Carbon Broker
Adding to the quandary, MHI wants to become a leading carbon broker, working with projects that will supposedly pull CO2 from the atmosphere and store it. Presumably, this includes its own coal and gas-fired power projects.
It recently inked a deal with Swiss carbon offset provider South Pole to buy almost 200,000 tonnes of carbon credits from technological schemes, about a quarter of all such purchases. Their joint venture is called NextGen.
Profiting From Emissions
The deal will provide added profits to MHI coffers. USD 300-800 million worth of carbon removal credits by 2030 will be bought under its scheme. In turn, it will sell these carbon credits for millions of dollars. UBS Bank, Mitsui Shipping and Boston Consulting Group have already promised to buy them.
Indicative of the argument against the move and in favour of renewable energy projects, New Climate Institute researcher Takeshi Kuramochi called MHI’s carbon credit moves “disturbing”.
“If Mitsubishi is to strengthen its ‘commitment to the sustainable future’, they would better contribute to [emissions reductions] by first accelerating its transition of fossil fuel-heavy energy business to renewables,” he said.
Moreover, MHI’s problematic Scope 3 emissions were 1.575 billion tonnes of CO2e in 2021. This was based on a non-consolidated basis and the group companies.
Mitsubishi Motors, for its part, continues to tout its moves in a barrage of press releases and media blasts that it will help achieve a carbon-neutral world.
To date, few media outlets are covering the validity of Mitsubishi‘s sustainability pledges. Fewer still hold them accountable for what can only be called greenwashing and furthering a false climate change mitigation narrative.
by Tim Daiss
Tim has been working in energy markets in the Asia-Pacific region for more than ten years. He was trained as an LNG and oil markets analyst and writer then switched to working in sustainable energy, including solar and wind power project financing and due diligence. He’s performed regulatory, geopolitical and market due diligence for energy projects in Vietnam, Thailand and Indonesia. He’s also worked as a consultant/advisor for US, UK and Singapore-based energy consultancies including Wood Mackenzie, Enerdata, S&P Global, KBR, Critical Resource, and others. He is the Chief Marketing Officer (CMO) for US-based lithium-sulfur EV battery start-up Bemp Research Corp.Read more