Climate Action, Environmental Impact and Resource Efficiency
As a leading company in the industry, Kraton’s climate action management approach centers on creating long-term sustainability value for our operations, businesses, and external stakeholders.
Our proactive strategy takes a holistic approach, setting ambitious goals for reducing greenhouse gas (GHG) emissions, implementing effective monitoring and management systems, and exploring initiatives and their potential risks and benefits. This proactive stance enables Kraton to address the challenges presented by climate change and the urgent need to transition toward a low-carbon economy.
Climate, Energy, and GHG Management are ranked as high priority topics in Kraton’s materiality assessment. This ranking, in addition to the financial materiality, acknowledges the importance of the inside-out impacts of these topics for our stakeholders. Consequentially, climate action management and the corresponding disclosures of Kraton’s performance emerge as critical focus areas for our external stakeholders and the respective Kraton governance committees.
From the climate action governance perspective, Kraton’s Strategy, Sustainability and Investments (SSI) Committee of the Board oversees Kraton’s sustainability efforts, including climate change. The Board is responsible for supervising major plans, investments, annual budgets, and setting performance objectives related to climate change.
Kraton’s Sustainability Council plays a pivotal role in guiding the company’s global approach to climate change. Serving as the corporate-level decision-making body, it defines resource requirements, and overseeing the implementation and progress of our climate change initiatives. Kraton’s Polymers and Pine Chemicals Sustainability Task Forces execute the decisions made by the Sustainability Council and ensure the cascading of necessary actions through their respective organizations at the operation level.
Read more about Climate Action, Environmental Impact & Resource Efficiency on page 52 in our 2023 Sustainability Report.
Kraton adheres to the highest standards in conducting our business. Our environmental management systems are designed to achieve Zero Harm: no harm to our employees, communities, or the environment. Our suite of policies goes beyond regulatory compliance, and highlights various environmental aspects and risks.
These policies include:
Water
Shifting patterns of water availability and incidences of flooding, driven by climate change, are raising global water concerns. While the majority of our plants are situated near bodies of water, we currently operate in areas not classified as water-stressed. However, we recognize that water availability is a critical issue for certain parts of the world and will likely become more severe over time. Water is a basic requirement for our manufacturing operations, with the chemical industry relying on water for materials processing, washing, cooling, and transportation of products via waterways. Hence water stewardship, alongside climate action, holds particular importance to Kraton.
Kraton remains committed to our long-term target for water: Reduce water withdrawn intensity by 10% by 2030, compared to the 2020 baseline year.
Waste Management
Waste management is another key aspect of Kraton’s environmental performance. We continue to improve our processes and reduce the generation of process residuals. Wherever possible, we seek to minimize waste by recycling or reusing process residuals such as catalysts. Additionally, we maintain vigilant oversight of non-conforming products, including using our by-products for fuel or other commercial applications.
Kraton remains committed to our 2030 target for waste intensity reduction, aiming to reduce waste intensity by 10% by 2030, compared to the 2020 baseline year.
Inside Preserving Planet
By maintaining open lines of communication and setting collective targets, we seek to foster an environment where energy efficiency is prioritized. As part of our commitment, our facilities utilize information screens, dashboards, and operator views visualize energy usage. Additionally, we have implemented steam trap maintenance and leak elimination programs and fostered engagement among the plants through bi-monthly energy network meetings.
In 2023, Kraton consumed 9,832 (TJ) of energy, approximately an 8% decrease compared to 2020. Notably, 12% of our energy consumption was renewable, representing a slight increase compared to 2022. This includes the use of our biobased byproducts, such as pitch, as fuel, and the purchase of renewable electricity in our Scandinavian facilities.
Energy intensity was 9.2 MMBTU/Ton, constituting a 16% increase compared to 2022. The change in energy intensity is mainly attributable to a low volume of production across the organization in 2023. Energy intensity is calculated based on the total energy consumed within the organization divided by tons of product produced.
In 2023, we initiated the Belpre Strategic Energy Project (BSEP), which involves generating electricity on-site. The impact of BSEP feeds into our 20% emissions intensity reduction target, as purchased electricity in this facility was reduced by 75%.
Kraton is actively working to lower its carbon footprint and energy use. Our aim to achieve a 20% decrease in GHG emissions intensity from 2020 levels by 2030, against a 2020 baseline, remains unchanged.
Over the past three years, we have consistently made progress, reflecting a positive trend in our on-going efforts to improve operational efficiency. Notably, we have continued to modernize our technology and machinery to reduce the overall CO2 output. For instance, the installation of a combustion turbine generator with a heat recovery boiler in Belpre has not only reduced purchased electricity costs, but also resulted in a reduction of carbon dioxide emissions by almost 60,000 MTCO2 compared to 2022, thanks to the new combined heat and power system.
Since 2014, Kraton has steadily reduced our total absolute emissions (Scope 1 and Scope 2). In 2023, our total absolute emissions decreased by approximately 14% compared to 2022, despite experiencing a production volume decrease of approximately 18%.
Water is critical to life on Earth and one of our planet’s most valuable resources, which demands careful stewardship. With global water stress as an evolving challenge, Kraton recognizes the intrinsic link between climate change and water availability, and takes a holistic view of safeguarding and conserving our natural resources.
In 2023, Kraton reported a withdrawal of 67,410 (1000) m³ of water, reflecting a notable 5% decrease compared to 2022 and an impressive 11% decrease compared to the 2020 baseline. These reductions in absolute volume can be attributed to the installation of water-cooling towers at our Dover and Panama City facilities.
Furthermore, Kraton reports 9,356 (1000) m³ of water consumption. Kraton’s water withdrawn intensity figures for 2023 are 66.2 (1000) m³/ton of product produced.
Due to low production volumes, this represents an increase compared to the 2020 baseline. Kraton successfully implemented systems and sensors in 2022 to detect and prevent potential accidental waterbody contamination. Further, we maintain water monitoring systems and ensure compliance with federal, state, and local requirements at all our sites. In 2023, there were no incidents of non-compliance associated with water quality permits, standards, and regulations.
In the unlikely event of a local uncontainable release, we have emergency preparedness and response procedures to mitigate the impact. We have invested in additional process control instrumentation and introduced better tank sealing and control improvements to minimize both odor emissions and material releases from our operations. Further, we have installed filters and vacuum equipment to control or minimize emissions of dust or particles. As part of the ongoing legacy remediation program, we also undertook soil testing for heavy metal contamination. No contamination was detected at our perimeter sampling points.
We are committed to continually improving our processes to 19% Increase minimize the generation of process residuals. Wherever possible, we seek to minimize waste by recycling or reusing process residuals such as catalysts, maintaining proper oversight of non-conforming products, and using our by-products for fuel or other commercial applications. Our waste management policy, introduced in 2022, underscores our core approach to waste management. Additionally, we’ve introduced hazardous material transportation training to proactively mitigate potential risks associated with transporting hazardous materials.
In 2023, we achieved significant reductions in both nonhazardous solid waste disposal and hazardous waste generation compared to 2022. Our non-hazardous solid waste disposal decreased by approximately 14% amounting to 15,394 tons.
Our hazardous waste generation decreased by 30%, amounting to 4,483 tons.
| Type of Waste | KG/TON of Product Produced | Compared to 2020 Baseline |
|---|---|---|
| Solid Waste Intensity | 15.1245.81 Kg Solid Waste  | 4% Decrease  |
| Hazardous Waste Intensity  | 4.41 Kg Hazardous Waste  | 19% Increase  |
As part of permit requirements and/or regulations, we also monitor the concentration of several pollutants in gas emissions (e.g., VOCs, NOx, SOx). We continued our efforts to reduce our air emissions, such as reducing leaks and losses from mechanical equipment. In 2023 we reported:
| Air Emission Type | Year: 2023 | Compared to 2022  |
|---|---|---|
| Volatile Organic Compounds (VOC)  | 336 Tons  | 21% Decrease |
| Sulphur Oxides (SOx)  | 52 Tons  | 27% Increase  |
| Nitrogen Oxides (NOx)  | 301 Tons  | 9% Decrease  |
The changes are attributable to more extensive and improved monitoring of boiler performance. Since 2015, we have replaced one natural gas and to coal boilers in Belpre with two new natural gas boilers from the Belpre Strategic Energy Project (BSEP I and BSEP II projects). This purchase has brought us a substantial, immediate reduction in emissions, including NOx, and we continue to see this benefit on a year-by-year basis.  
Kraton is dedicated to preserving biodiversity and the ecosystems in which we operate. Biodiversity is essential to the health and resilience of ecosystems and people. We understand how business operations can impact the local biodiversity. Kraton is committed to identifying and managing its biodiversity risks and promoting sustainable land use practices.
Our facilities are strategically located in cities or towns that are not deemed critical habitats or recognized for high biodiversity value or High Conservation Value (HCV). Additionally, we have refrained from constructing any new facilities in green fields that could pose a threat to biodiversity.