Deutsche Telekom performs CO2 vanishing act

The German telecom incumbent claims to have reduced its carbon emissions by 94% since 2017, but it depends how you measure it.

Iain Morris, International Editor

April 6, 2023

5 Min Read
Deutsche Telekom performs CO2 vanishing act

At some point in 2021, Deutsche Telekom went from looking dirtier than a chain-smoking coalminer to greener than a leaf-eating peasant before the invention of factories. In 2020, its global operations had spewed out roughly 2.5 million tons of carbon dioxide, about 700,000 more than they belched in 2019. After what appears like a massive "net zero" clean-up, its emissions thinned like smoke at a magic show to an eco-friendly 247,000 tons in 2021, less than a tenth of the amount the year before. Last year, it produced only 233,000 tons.

There are several possible explanations for this carbon-dioxide vanishing act. One, even before Vlad the Invader's desecration of Ukraine, Germany had abruptly switched from gas to wind and sun for power supplies. Two, Deutsche Telekom figured out how to support a quarter of a billion mobile connections worldwide using a fraction of the energy it previously needed. Three, Deutsche Telekom retrofitted all its basestations to include wind turbines, solar panels or kilowatt-generating bike machines pedaled by local staff. Four, Deutsche Telekom signed reams of power purchase agreements (PPAs) with renewables companies.

Figure 1: CEO Timotheus Hottges (left) and other members of Deutsche Telekom's board. (Source: Deutsche Telekom) CEO Timotheus Höttges (left) and other members of Deutsche Telekom's board.
(Source: Deutsche Telekom)

It's definitely not one. Germany scores well on renewables, which generated 46% of its power last year, according to government data. But this was only five percentage points higher than the 2021 figure. It's definitely not two, either. Energy consumption has risen dramatically at the German incumbent since 2016, in stark contrast to the trend seen at other big European telcos. Seven years ago, Deutsche Telekom had just guzzled about 8.9 terawatt hours in a full year. Last year, it chomped through nearly 13.3. Most of the increase is probably due to its US takeover of Sprint in 2020, the year the big leap occurs.

As you don't see that many wind turbines on basestations, or men cycling furiously beneath them without moving, we can probably discount three. This leaves investment in PPAs. Anyone plowing through Deutsche Telekom's last, 319-page annual report would have seen this identified as the sole explanation without having to cross out less probable causes. And it's as dubious as the Nobel Peace Prize bagged by Yasser Arafat.

Figure 2: Annual carbon dioxide emissions (tons) (Source: companies) (Note: data for Deutsche Telekom, Orange and Telefonica refers to the 2022 calendar, while for BT and Vodafone, it measures the fiscal year to March 2022; data for T-Mobile US is from 2021) (Source: companies)
(Note: data for Deutsche Telekom, Orange and Telefónica refers to the 2022 calendar, while for BT and Vodafone, it measures the fiscal year to March 2022; data for T-Mobile US is from 2021)

Spurious claims

There's nothing necessarily wrong with PPAs, but they don't guarantee that a company's energy supplies are clean. The worst form are renewable energy certificates (RECs) that allow a company to flaunt emissions cuts even as it continues to buy from a national grid fed by multiple energy sources. It's these sorts of agreements that often explain why a company's reported emissions have dropped as sharply as Deutsche Telekom's did in 2021, and why they still look stratospherically higher when measured according to the energy mix of the grid.

Germany's biggest telco evidently doesn't want you to know this "location-based" figure, or it would have deigned to include the number in its latest annual report. Instead, you are forced to click through multiple links in its interactive corporate responsibility report to uncover the truth, which is that Deutsche Telekom emitted about 4.4 million tons of carbon dioxide last year. That didn't stop CEO Timotheus Höttges from frothing about climate protection in front of shareholders this week. "We emit 94% fewer emissions than in 2017," he boasted.

Other telcos have been more forthcoming. Under Scopes 1 and 2, the emissions categories over which companies have direct control, Vodafone produced more than a million tons of carbon dioxide using Deutsche Telekom's "market-based" method in the fiscal year to March 2022 – quite a bit more than its German rival. But with the location-based method, Vodafone's emissions soared to nearly 2.3 million. It's a similar story for other telcos. BT's emissions drop from about 735,000 tons under the location method to less than 181,000 using the market one over the same period. Telefónica's tumble from about 1.1 million to 353,000 for 2022.

Figure 3: Deutsche Telekom's location-based CO2 emissions (tons) (Source: Deutsche Telekom) (Source: Deutsche Telekom)

The divulgers, interestingly, include Deutsche Telekom US subsidiary T-Mobile. According to its latest eco report, issued in January, it was responsible for only 70,350 tons of carbon dioxide emissions based on its purchase of dodgy-sounding "virtual" PPAs in 2021. Substitute the old-fashioned location method, though, and it coughed up nearly 3 million – about 700,000 more than the whole of Vodafone.

Once again, market-based isn't all bad. If these aren't just cynical RECs, their wider use should eventually lead to an equalization with location-based figures (shouldn't it?), as renewables flood the grid. But this change is not happening very quickly, and in some cases, it is not happening at all. With Deutsche Telekom's takeover of T-Mobile in 2020, group emissions soared 37%. And last year, they were up 19% on the 2017 figure, using the methodology Höttges prefers to hide. None of this looks very green.

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— Iain Morris, International Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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