The chemicals maker, once part of DowDupont, joins a growing list of companies that have announced plans to cut emissions and reduce carbon footprint following pressure from investors.
Near-term investments in packaging, specialty plastics, coatings and some other businesses are expected to generate about $2 billion of additional earnings before interest, tax, depreciation and amortization (EBITDA), and the new ethylene and derivatives complex is expected to deliver about $1 billion of EBITDA per year by 2030.
The new facility would more than triple Dow’s ethylene and polyethylene capacity from its Fort Saskatchewan, Alberta site, and the company expects to allocate about $1 billion of capital spending annually for the project.
Dow also said it signed eight new renewable power purchase agreements across Europe and Americas to reduce its Scope 2 emissions, or emissions from the power a company uses for its operations, by more than 600,000 metric tons of carbon dioxide equivalent per year.
Dow had last year set a target to be carbon neutral by 2050.
United Nations scientists say the world’s net emissions must fall to zero by 2050 to limit the rise in global temperatures to no more than 1.5 degrees Celsius versus pre-industrial levels.
Net zero plans require companies to decrease carbon dioxide emissions and offset any remaining emissions using projects that capture the gas.