이 기사는 2022년 03월 08일 08:07 thebell 에 표출된 기사입니다.

LG Electronics' board thinks it is too early for the company to participate in the Renewable Energy 100 (RE100) initiative despite growing calls to make a greater environmental commitment.

LG Electronics’ ESG (environment, social and corporate governance) committee had its first meeting in July 2021.

Five members of the committee discussed whether to approve the company’s participation in the RE100 campaign, a global initiative to shift 100% to renewable energy by 2050, and LG Electronics’ board decided to re-deliberate the item after analyzing the impact on the business more closely.

RE100 is an international campaign launched by nonprofit organization the Climate Group in partnership with Carbon Disclosure Project in 2014. The campaign targets companies that consume more than 100GWh per year and prompts them to transition to using 100% renewable energy by 2050.

Among domestic companies, companies under SK Group, LG Chem, LG Energy Solution and KB Financial Group have joined the campaign.

A discussion of participation in the RE100 at a board meeting is understood as a relatively preemptive move. South Korea’s tech giant Samsung Electronics’ sustainability committee hasn’t officially put the RE100 issue on the table yet.

LG Electronics is trying to become the member of the RE100 club amid growing trend of global RE100 members asking their suppliers to switch to renewables to remain competitive. Top global firms including Apple, Google, BMW and IKEA already participated in the initiative.

LG Electronics is working closely together with global companies like Apple. The Korean company is considered one of the candidates of Apple Car production partner. Analysts said Apple may ask its suppliers to join the RE100 initiative.

Domestic conglomerates are rushing to join the initiative after Samsung Electronics was criticized for not joining the RE100 at the National Assembly audit last year.

LG Electronics’ board has focused on the firm’s capability instead of its willingness for participation. Members of the RE100 are required to submit implementation plans in their first year of membership. They need to buy renewable energy certificates from power providers on the open market to reach their commitments. The RE100 considers electricity produced from energy sources including geothermal, solar, water, wind and biomass as renewable.

LG Electronics started its efforts to make a complete transition to renewable energy last year, starting with its offices and manufacturing sites in North America. It also set up a solar power generator in its plant in Noida, India.

“In Korea, the price for electricity usage is relatively low due to high reliance on nuclear power,” said an industry source, adding, “Companies would have had to be cautious as the cost of purchasing electricity would increase if they introduce renewable energy.”

LG Electronics can’t just push ahead with the renewable energy transition as it needs to manage its supply chain which includes many partners. This has made LG Electronics’ board to put the brakes on the RE100 participation plan to avoid the opposite of the intended effect.

LG Electronics plans to achieve carbon neutrality by 2030 and make a complete transition to renewable energy by 2050. It is aiming to achieve a 60% transition to reusable energy at its local operations by 2030 and a 90% transition by 2040.

To achieve this, the company plans to install high-efficiency LG solar panels on its buildings and utilize power purchase agreements that allow companies to purchase electricity directly from suppliers. (Reporting by Hyun-ji Sohn)