Energy use

 

In 2007, total energy use decreased slightly by 0.2% from 16.39 million GJ in 2006 to 16.36 million GJ (compared to a growth in sales of 8% for the same period).

Total purchased energy also decreased slightly from 9.71 million GJ in 2006 to 9.57 million GJ (-1.5%) while total on-site energy increased from 6.67 million GJ to 6.79 million GJ ( up 1.7%).

Novartis has progressed further in switching to less carbon intensive and more renewable energy resources; 91% of on-site generated energy came from the combustion of natural gas and 1.5% from renewable sources.

Sandoz (7.28 million GJ) was the largest energy user in Novartis, followed by Pharma (5.38 million GJ) and Consumer Health (1.54 million GJ).

 

Energy use targets and outlook

In 2007, for the first time ever, energy use did not increase, despite a continued expansion of activities and further business growth. The trend in improved energy efficiency is expected to continue in future years as a consequence of the energy efficiency programs being enacted throughout the organization.

Total energy costs for the Novartis Group are USD 298 million for 2007, of which USD 186 million are spent on electricity.

 

Energy efficiency improvement index

After successfully completing the previous target period 2003-2006, Novartis has set a new energy efficiency improvement target of 10% for the period 2007 to 2010 (based on the 2006 performance), which translates to an average 2.5% energy efficiency improvement per year.

In order to determine energy efficiency improvements, total energy use for each Division or Business Unit is normalized with the most meaningful denominator for the unit, i.e. sales for Pharma and Sandoz, production for Consumer Health, and number of associates foir Novartis Research and Vaccines & Diagnostics. Percentage improvement changes with respect to the base year selected (2006) are reported and managed for each Division or Business Unit. The Corporate result is determined as the weighted average of the improvement for each unit.

In 2007, Novartis, taking the average for all Divisions and Business Units, has achieved energy efficiency improvements of 9% compared to 2006. This is well above the 2.5% defined as the target annual improvement for the years 2007 to 2010. We will further increase our efforts to save energy in order to secure the 2010 target and to most effectively support the greenhouse gas emission reduction target.