Why it matters

The potential impacts from climate-related risks have been identified as a top sustainability concern by our stakeholders. We are focused not only on reducing the carbon footprint of our fertilizer production (primarily nitrogen), but also on partnering with growers to reduce in-field GHG emissions and sequestering more carbon in the soil.

Our work on climate change supports the following United Nations Sustainable Development Goals

Our approach

Our commitments reflect three climate-related areas of focus:

• Enabling emission reductions at the farm level: Nutrien’s focus on sustainable agriculture helps us to identify and develop opportunities for growers to adopt improved nutrient and land management practices, and use advanced nutritional products and digital tools to measure the impact of sustainable solutions on GHG emissions at the farm level. Taking a whole-acre approach to sustainable solutions encompasses an improvement in soil quality and water management, making farms more resilient to weather extremes. The Carbon Program is one way Nutrien supports the use of products and practices that reduce emissions at the farm level and deliver more sustainable outcomes.
• Reducing emissions from operations: We have committed to at least a 30 percent targeted reduction in Scope 1 and 2 GHG emissions intensity by 2030 from a baseline year of 2018, and Nutrien has forecasted to spend more than $500 million in pursuit of this target. Specific project execution will depend on a range of factors, including the final investment decision of the Geismar Clean Ammonia plant. Going forward, we expect to selectively execute emissions abatement projects as the compliance landscape evolves and the direct and indirect costs of carbon, as well as attractive opportunities to our business, justify incremental capital investment. Targeting emissions reduction also addresses a key transition risk in our fertilizer operations related to regulations and existing and potential regional carbon taxes.
• Achieving the development of a Science Based Target that is appropriate and specific to the fertilizer sector: Nutrien reported our climate strategy in 2021 with clear short-term and mid-term reduction targets for Scope 1 and 2 GHG emissions, demonstrating our support of the Paris Agreement goals and our commitment to the Science Based Targets initiative (“SBTi”) to set a science-based target. We continue to work with the World Business Council for Sustainable Development (“WBCSD”), fertilizer peers and the SBTi to produce a sectoral decarbonization approach (“SDA”) for the fertilizer industry. An SDA is one of three possible methods for setting a science-based target. The role of nitrogen in food production, soil health and optimizing land use are unique attributes differentiating nitrogen fertilizer manufacturing from other chemical industries and these attributes need to be considered in developing the SDA process.

Our impacts

Primary emissions sources along Nutrien's value chain

Fertilizer production and use have complex and conflicting impacts on GHG emissions across the agricultural value chain. Fertilizer is critical for healthy crops, enhancing soil carbon (the level of carbon that is directly tied to the level of organic matter in the soil) and increasing yields, which helps to feed our growing population with the same amount of arable land, but nitrogen fertilizer also generates GHG emissions when it is produced and when it is applied to the soil.

Emissions released during production

Although we operate across the crop input value chain and produce many products, the manufacturing of fertilizer accounts for approximately 95 percent of our Company-wide direct (Scope 1) and indirect (Scope 2) emissions. Direct emissions are generated on site, from burning natural gas and other fuels, or from processes at our operations. Indirect emissions are from the off-site generation of purchased electricity, steam and heat.

GHG emissions related to the three types of fertilizers we produce come from the following sources:

• Nitrogen: Nitrogen fertilizer is produced by reacting hydrogen, primarily from natural gas, with nitrogen from the air to produce ammonia (NH₃), the basic building block of all nitrogen fertilizer. Approximately 95 percent of the natural gas we consume is in the production of ammonia, with approximately two-thirds of this natural gas used as hydrogen feedstock in this process. The main Scope 1 GHG emission sources are CO₂ from fuel combustion, industrial process CO₂ as a byproduct of hydrogen generation and nitrous oxide (N₂O) emissions generated as a byproduct of nitric acid production.
• Potash: Potash is mined underground, hoisted to the surface, then crushed and purified with electricity powered equipment to remove rock particles and salt before being dried. Potash operations result in Scope 1 emissions from operation of gas-fired boilers and dryers, as well as mobile equipment. Scope 2 emissions are primarily associated with purchased electricity required to operate processing equipment in our mills.
• Phosphate: The production process for phosphate can generate GHG emissions in two ways. Entrained carbonates (dissolved CO₂ in the phosphate rock) are released into the air as CO₂ through a chemical reaction, and GHGs can also be released through the use of fossil fuels to calcine phosphate rock feedstock or dry fertilizer products. Purchased electricity required to operate processing equipment also contributes to Scope 2 emissions in phosphate production.

Scope 1 and 2 assessment: Nutrien reports our emissions following the GHG Protocol Corporate Accounting and Reporting Standard on an operational control basis. Read our KPMG LLP provided limited assurance over our 2022 GHG emissions.

Emissions released by using fertilizers

GHG emissions from fertilizer use occurs with nitrogen-containing fertilizers (as well as from organic sources of nitrogen). N2O is the GHG of primary concern, although CO2 is also directly emitted from urea forms of nitrogen. N2O can be produced from nitrate-nitrogen under saturated soil conditions when there is an excess of nitrate-nitrogen in the soil and temperatures are warm enough for microbial activity. Microorganisms convert the nitrate to a variety of nitrogen gases, including small amounts of N2O, which can then be lost from the soil to the atmosphere. N2O can also be emitted in the nitrification step (conversion of ammonium to nitrate), which is also a biological process. Learn more about the nitrogen cycle.

For Nutrien, these emissions are significant as approximately 47 percent of the fertilizer we sell to our growers is nitrogen-based and has the potential to produce GHG emissions. Fertilizer management practices are an important way to reduce N2O emissions and one of the reasons agronomists and field experts at Nutrien provide farmers with nutrient-management planning advice. Read more about Nutrien’s Carbon Program, which is designed to support the agricultural industry through soil carbon sequestration and reduced GHG emissions.

Scope 3 assessment: Scope 3 includes indirect GHG emissions other than those covered in Scope 2, upstream and downstream from our business. Greater reporting and transparency are required from participants across the agricultural supply chain, and we are building a greater understanding of our broader climate change impacts by starting to quantify Nutrien’s Scope 3 emissions. Improved understanding is expected to enable collaboration and effective decision making that drives beneficial change.

 Our Actions to Reduce GHG Emissions

We believe a combination of strategies will be needed to meet society’s decarbonization goals. Our reduction plans include activities to reduce the direct Scope 1 GHG emissions intensity at our manufacturing facilities and the indirect Scope 2 GHG intensity emissions from purchased energy, such as steam and electricity, while reducing other material emissions that are upstream and downstream of our operations. Nutrien is exploring multiple opportunities for the responsible development of low-carbon ammonia and derivative fertilizers. We have dedicated support to the development of clear and transparent certification of low-carbon and clean ammonia.

Disclosures

We have used the Task Force on Climate-Related Financial Disclosures (TCFD) framework to report on our climate strategy and performance. Read our TCFD disclosures on page 96-102 of our 2023 ESG Report. To learn more see our CDP Climate Questionnaire. Both are linked below.