Environmental Stewardship

Carbon Management and Energy Efficiency

[EN16, EN23] We believe our leadership in proactively addressing the carbon impacts of our operations and products will be recognized and rewarded through increased customer loyalty and enhanced community relations. During 2008, we continued to calculate and offset our operational carbon footprint and are in the process of developing a corporate carbon strategy. Below is a table that details ProLogis’ total direct and indirect greenhouse gas emissions by weight for the year. (1)

ProLogis also continues to work with the Chicago Climate Exchange (CCX), the world’s first voluntary, legally binding greenhouse gas emissions reduction, registry and trading program. As an Associate Member in CCX, we have committed to annually measuring and offsetting 100% of our U.S. operational carbon footprint. We have taken our commitment to the next level by measuring and offsetting 100% of our global operational carbon footprint. For 2009, we committed to establishing a goal for reducing these carbon emissions and have already made progress in increasing our efficiency.

Electricity/Indirect Energy Consumption

Natural Gas

Carbon Footprint

12,200,155
kWh

63,410
therms

16,293.91
metric tons of CO2

 

For example, in early 2008 we began fine-tuning our headquarters building to maximize efficiency through practices such as adjusting our HVAC schedule and investing in additional controls for lighting. We also invested in GPS units for all of our maintenance trucks to reduce unnecessary driving and identify the most efficient routes possible. While we believe buying carbon offsets is necessary to mitigate our environmental impact, we also believe the responsible approach to carbon management is to become as efficient as possible first, and then offset only what we cannot feasibly reduce.

We recognize that our carbon emissions not only result from our operations, but also from our supply chain. In 2008, we concluded a study to measure the embodied carbon of ProLogis Park Pineham in the U.K. Embodied carbon is the carbon associated with the life-cycle of warehouse development, beginning with extraction of raw materials to make building components, the manufacturing of the materials and their transport to the site, the energy consumed during construction, and finally, the demolition and waste management at the end of the building's life. Partnering with our suppliers, we offset 110% of the building's embodied carbon footprint, thus delivering our customer a carbon-neutral building from the start. We began a similar study on a U.S. warehouse in 2008, which will be concluded once our development activity resumes.

By addressing not only our direct emissions but also the emissions over which we have less control, we believe we are taking a comprehensive approach to addressing carbon and the impacts of our business on climate change.

[EN28] ProLogis has never been fined for non-compliance with environmental laws and regulations and, [EN23] due to the nature of our business we have a very low risk of significant spills.

[EN3, EN4] We are focused on improving the energy efficiency of the existing facilities in our portfolio. In 2006, we initiated a lighting program to install or upgrade the lighting systems in our North American portfolio with energy-efficient T5 and T8 fluorescent lighting. As of the end of 2008, high-efficiency lighting had been installed in more than 26 million square feet (sf) of warehouse space. Compared to standard warehouse lighting systems, this translates into a savings of over 29 million kilowatt hours (kWh) of electricity per year, enough energy to power more than 2,600 Americans' homes for one year or produce more than 21,000 metric tons of carbon dioxide emissions. Below is a table demonstrating the total number of high-efficiency lighting systems year-over-year since we first started the program (2):

  North American Portfolio

2008

11.8M SF

2007

11.4M SF

2006

3.1M SF


In Europe, as part of a directive related to the Kyoto Protocol, many countries are now required to implement a rating system to designate building energy efficiency. This is an effort to educate consumers and the market about the environmental impacts of buildings, with the ultimate goal of improving energy performance. For example, as of October 2008, the U.K. government mandated that all commercial buildings have an Energy Performance Certificate (EPC) when they are bought, sold or rented. Twelve of our warehouses have earned or projected scores that equate to using between 30-40% less energy than similar new buildings. Other countries are adopting rating systems as well. At this time, our German warehouses are averaging a 45-50% energy reduction compared to similar new warehouses. The number of warehouses rated under other systems is minimal, but early results show that these too are above average in terms of energy efficiency. We have a system in place to track our EPC scores and average savings, and will continue to monitor and report our performance in this area.

©2009 ProLogis

In early 2008, ProLogis acquired a company plane that is no longer in use and is currently marketed for sale. The company plane accounted for approximately 2,200 metric tons of CO2, which indicates that the total organic output from ProLogis for 2008, not including the plane, was in fact less than the previous year.
The total amount of high efficiency lighting installed is not directly under ProLogis’ control; our customers choose whether or not they want to upgrade their lighting systems in existing facilities and incur the related costs. In addition, current economic circumstances are causing many companies to reevaluate their priorities and cut back on certain non-critical activities, which can include sustainability efforts that require capital outlay. Despite this, through our frequent customer contact we will continue to promote high-efficiency lighting to our customers, as it typically achieves a fast return on investment and reduces their operating costs. ProLogis also will continue to invest in high-efficiency lighting to make its vacant space more attractive to potential customers. However, because of economic circumstances we will likely commit less of our own capital to lighting upgrades than we otherwise would.