Housing transactions and services industry has gradually emphasized the importance of environment externality and carbon reduction.
On December 15th, KE Holdings Inc. (BEKE: NYSE) released the "2023 KE Holdings Carbon Neutrality Goals and Action Roadmap Report," committing to achieve carbon neutrality in its operational activities by no later than 2030.
This is the first time that KE Holdings has announced its carbon neutrality goals and action roadmap. KE Holdings promises to achieve carbon neutrality at its operational level (Scope 1 and Scope 2) by 2030. By 2030, the carbon intensity of its headquarters and real estate brokerage business value chain (Scope 3) is expected to decrease by 60% compared to the baseline year of 2022. Similarly, the carbon intensity of its home decoration and housing leasing business value chain (Scope 3) is expected to decrease by 30% compared to the baseline year of 2022.
The 2023 KE Holdings Carbon Neutrality Report mentions that over the past two years, KE Holdings has conducted two inventories of greenhouse gas emissions generated by its real estate brokerage business and overall operations. Based on the carbon inventory work and considering future business plans, the level of low-carbon development in the industry, and existing emission reduction measures, KE Holdings has proposed carbon neutrality goals and an action roadmap. Starting from a top-level design perspective, KE Holdings comprehensively assesses the potential physical risks and transformation risks of climate change to its business operations. In 2022, KE Holdings established the Corporate Social Responsibility Center's Sustainable Development Department to plan strategic layouts in advance.
At the operational level, KE Holdings plans to implement emission reduction measures through management improvement, energy structure optimization, and technological innovation. Approximately 80% of KE Holdings's operational emissions come from purchased electricity, with nearly 80% of that coming from the electricity usage of its stores. Therefore, energy conservation in stores is crucial for KE Holdings to achieve its carbon neutrality goals. To achieve this, KE Holdings has introduced an intelligent energy control system to intelligently monitor, diagnose, and optimize the energy usage in its stores. In September 2023, the Beijing Lianjia Alpha Community Store has obtained LEED Gold certification, making it the first Lianjia store to achieve LEED certification. KE Holdings will continue to promote the establishment of more green stores in the future.
At the value chain level, KE Holdings collaborates with upstream and downstream ecological partners to reduce emissions and carbon footprint through green procurement, green supply chains, and green logistics. According to KE Holdings's 2022 carbon accounting results, approximately 55% of the emissions in KE Holdings's value chain come from its daily procurement, including product procurement during business operations and material procurement supporting its own operations. Approximately 21% of the emissions come from data centers leased by KE Holdings, and around 15% of the emissions come from the purchase of large equipment, vehicles, furniture, and other items.
Additionally, KE Holdings utilizes VR technology to support low-carbon and environmentally friendly practices. With independently developed VR capture software and hardware, KE Holdings has effectively improved the efficiency of agents and customers in house viewing while reducing their carbon footprint from traveling. In 2022, KE Holdings platform users accumulated over 1.508 billion VR house viewings, resulting in a reduction of more than 2.7898 million tons of carbon emissions compared to traditional on-site house viewings.
KE Holdings's co-founder, Chairman, and CEO, Peng Yongdong, illustrated, "KE Holdings is unwavering in its commitment to carbon neutrality, and addressing climate change will be an important agenda in the future work. As a technology-driven one-stop new residential service platform, we hope to drive a broader range of carbon reduction through technology empowerment and community connections. Through technologies such as VR, AR, and online contract signing, we aim to engage users, agents, and other stakeholders to collectively create a low-carbon future in the housing sector."
As of press time, KE Holdings closed at USD 15.06 apiece, with a market capitalization of USD 18,691 million.