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- Industry News
- 17 February 2026
Volvo’s Taizhou manufacturing plant has switched to biogas, making it the company’s first plant in China to achieve climate-neutral status. The plant’s switch from natural gas will result in a reduction of more than 7 000 tons of CO2 a year.
Despite being a small share of their total scope 1 - 3 emissions of 43 million tons, securing climate-neutral energy for the Taizhou plant is an important step towards the goal of having climate-neutral manufacturing operations by 2025 and reducing emissions across their global operations. This ambition is also part of Volvo’s broader aim to reach net zero greenhouse gas emissions by 2040.
“Just like all our manufacturing plants worldwide, the Taizhou plant already uses climate-neutral electricity, and this latest move ensures that it also has climate-neutral heating. It is our second car plant globally to become climate-neutral after our Torslanda facility in Gothenburg, Sweden.
“We’re acting fast when viable climate-neutral energy alternatives become available,” says Javier Varela, chief operating officer and deputy CEO at Volvo Cars. “The switch to biogas at our Taizhou plant demonstrates how each of our manufacturing locations across the globe is developing its own climate-neutral energy mix, based on what’s available in the region.
“Our Taizhou plant’s energy supply comprises of electricity and heating. It produces around 40 per cent of its electricity requirements from on-site solar panels – a share that is set to expand in the coming years. The remaining 60 per cent, which comes from the grid, is also climate-neutral electricity from solar. Its heating need is, with this latest switch, met by using climate-neutral biogas,” he says.
Volvo Cars recently expanded its sustainability strategy with new ambitious goals for the coming years. Our new aim to reach zero greenhouse gas emissions by 2040 builds on the previous ambition of being climate neutral by 2040. “It clarifies that our first priority is to reduce real emissions before turning to carbon removals to mitigate any unavoidable emissions. We are also encouraging our suppliers to do the same.”
Since the release of the company’s first sustainability strategy in 2019, it has made good progress towards its climate-action targets. In addition to reducing CO2 emissions from the company’s total operations by using 74 per cent climate-neutral energy, it is also progressing well towards the overall CO2 targets.
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