Scope 1 & 2 (operational) emissions
Our primary Scope 1 emissions come from refrigerant gases, natural gas and transport fuels, with a small contribution from stationary LPG and diesel used for onsite back-up generators, and diesel used by online delivery trucks.
Scope 2 emissions come from the electricity we purchase to power our stores, distribution centres and offices, and represent the majority of our combined Scope 1 and Scope 2 emissions. Scope 2 emissions from our purchased electricity can be reported in two ways: location-based and market-based. The location-based method reflects the average emissions intensity of the electricity grid where our operations occur. The market-based method reflects emissions associated with Coles’ specific electricity procurement decisions, such as renewable electricity contracts or certificates, and therefore captures the impact of purchasing lower-emissions electricity.
By the end of FY26, we reduced our combined Scope 1 and 2 emissions relative to the FY20 baseline by 82.6%, positioning us ahead of our 75% FY30 target using a market-based Scope 2 methodology. This has been achieved through market-based renewable electricity purchases (including the surrender of large-scale generation certificates (LGCs)), solar installations across our operations, implementing energy efficiency initiatives and progressing refrigeration upgrades. Coles has not used carbon offsets to achieve our Scope 1 and Scope 2 emissions reductions.
Renewable electricity
Coles sources renewable electricity for its operations on a market-based basis. Like other electricity users connected to national and regional grids, the electricity Coles physically consumes from the grid reflects the relevant grid’s generation mix at the time of consumption, which may include both renewable and non-renewable generation.
Coles matches its electricity consumption with renewable electricity attributes through a combination of on-site solar, renewable electricity contracts with providers such as Origin Energy and CleanCo and associated large-scale generation certificates (LGCs), and other LGC arrangements.
Origin Energy Alliance
Through our strategic alliance with Origin Energy, Coles has expanded onsite renewable energy and battery storage across selected sites.
Between FY23 and FY26, we installed 16.45 MW of rooftop solar capacity and 1.345 MWh of battery energy storage, with participating sites expected to reduce annual grid electricity consumption by an average of 19.43%.
In FY26, we also trialled a battery energy storage system that combines back-up power with participation in energy markets through a virtual power plant. The trial will help assess the operational performance, commercial viability and emissions reduction potential of battery storage, informing future deployment.
Coles and Origin have extended the partnership for a further three years. The next phase is expected to deliver an additional 15 MW of rooftop solar capacity and 15 MWh of battery energy storage.
Energy efficiency
Energy management is a key part of reducing emissions and building long-term business resilience.
Refrigeration and air conditioning accounts for around 70% of store electricity use and is a major driver of our Scope 1 emissions.
Upgrading refrigeration systems is a key activity for Coles and we have a phased program though which we aim to upgrade 20–30 systems each year as stores reach end of life or in line with refurbishment schedules.
Our goal is to transition from high-Global Warming Potential (GWP) refrigerants to lower-GWP or natural alternatives by 2050. Additionally, when building new supermarkets, Coles uses natural refrigerants which have close to no GWP refrigerants compared with conventional synthetic refrigerants.
As part of our transition to natural refrigerants, Coles is trialling advanced heat generation and recovery technologies that capture waste heat from refrigeration systems and repurpose it to meet most in-store heating. This trial is helping assess opportunities to improve overall energy efficiency, reduce natural gas use and lower operational emissions.
Since FY22, Coles has been implementing a natural gas sub-metering and optimisation program across selected stores to improve visibility of gas use and identify opportunities to reduce consumption. Enhanced monitoring and targeted changes, including optimising boiler settings and heating controls, have enabled stores to better respond to seasonal conditions while maintaining in-store comfort.
