Ampol

Ampol plans to spend USD 70 million on its future energy strategy by 2025. The company does not disclose the breakdown of this investment but indicates it will be spent on electrification and green hydrogen. However, in the reporting year alone Ampol spent USD 160 million on fossil fuel expansion. The company should ensure it allocates its capital expenditure to low carbon products.

Ampol does not disclose how much it invests in low-carbon R&D. The company is running multiple pilots in low-carbon activities such as hydrogen from renewable energy and EVs which it intends to form the basis of its low-carbon activities. To help ensure the success of these technologies, Ampol should contribute towards its R&D, especially for technology such as green hydrogen which remains unproven at scale.

Ampol does not have a strategy to engage its suppliers on the climate crisis. However, in its 2025 strategy, it has set an aim to collaborate with its supply chain to set net zero emissions goals. To achieve the scale of value chain emissions reductions required by the low-carbon transition, it is imperative that midstream companies, the activities of which focus on oil and biofuel refining, engage their upstream suppliers and create demand for low-carbon alternatives. Ampol should set a clear strategy which contractually specifies emissions reduction requirements and require public emissions reporting.

Since the last (2021) assessment, Ampol’s EV charging activity has not expanded significantly despite this forming a key part of the company’s low-carbon strategy. It plans to add 180 EV charging points in 2023 to its current six, but does not provide more details of the long-term deployment plan. To allow Ampol to pivot away from oil and gas, it will need to have developed long-term, profitable low-carbon business models.

Ampol has elements of a transition plan. The company has set a target to reduce its scope 1 emissions by 5% by 2025, and 10% by 2030 compared to 2021 for emissions from fuels and infrastructure. For its convenience and retail activities, Ampol has set targets to reduce its scope 2 emissions by 25% by 2025, and 50% by 2030 compared to 2021. It also plans to reduce its scope 1 and 2 emissions by 50% by 2040 compared to 2021. It plans to expand EV charging facilities and develop green hydrogen. The company does not have any scope 3 targets or net zero targets.

Ampol has a long-term vision to develop EV charging facilities and hydrogen energy alongside conventional fuels between now and 2050. For this, the company has committed to spending USD 70 million on its future energy strategy by 2025. The power source for this planned EV charging is unclear, with current emissions being linked to EV charge points being offset with renewable energy certificates. Crucially, Ampol does not have a plan to scale down fossil fuel activities.

In 2021, Ampol created a partnership with Endua, a green hydrogen start-up working to bring green hydrogen generation and storage to scale. Ampol’s involvement with Endua and the progress of the development is unclear. Ampol also carried out an EV charging point pilot in 2022 in five locations. It is expected to have invested USD 10 million into future energy initiatives by the end of 2023, compared to the USD 160 million invested into fossil fuel expansion in the reporting year alone.

The company has set intentions to run several pilots including installing solar panels at retail sites, and commissioning a green hydrogen plant at its largest refinery. Ampol has installed 10 EV charge points at its retail sites. However, Ampol’s scope 1, 2 and 3 emissions intensity have increased between 2019 and 2022, driven by an increase in scope 1 and 2 emissions intensity and no change in sold products. The company has also bought Z Energy, a New Zealand fuel retailer, further expanding its high-carbon activities.

Ampol signals intentions to transition to low-carbon fuels but has not progressed any activities beyond the pilot stage. Since setting scope 1 and 2 emissions targets, Ampol’s scope 1 and 2 emissions intensities have continued to increase. The company recognises the shift in future consumer energy needs from high-carbon to low-carbon. However, it does not show signs of seriously transitioning to low-carbon fuels with 60% of Ampol’s capital expenditure allocated to fossil fuel expansion in the reporting year.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found of the company undertaking just transition planning to mitigate the social impacts of the low-carbon transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

The company discloses the actions it takes to to create jobs, including forming teams for future energy sources. However, no public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks. The company discloses the actions it takes to provide upskilling and educational opportunities for workers and affected stakeholders. For instance, it has a focus to bring education and associated employment opportunities to Australian youth. Furthermore, the company discloses the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. It does this through support for education towards Aboriginal and Torres Strait Islander girls, and training that targets women for leadership development. However, no evidence was found of the company having a process for identifying skills gaps for workers and stakeholders affected by the low-carbon transition or a public commitment to help workers displaced by the transition to re- or up-skill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. However, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. The company does, however, have a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. Additionally, the company discloses the share of women in its workforce, and targets regarding the representation of women in the company. However, the company can strengthen its performance and disclosure on these subjects as well as on its living wage and working hours practices.

The company commits to protecting personal data and discloses a privacy statement regarding use of personal data. Additionally, the company discloses its global tax strategy and board accountability for the strategy. Furthermore, the company has a policy prohibiting bribery and corruption, and includes corresponding clauses in its contracts with business relationships. However, the company can strengthen its performance and disclosure on these subjects as well as on its lobbying and political engagement practices.