T-Mobile Sets Industry-Leading 2040 Net-Zero Commitment

T-Mobile announced this week its intention to achieve net-zero emissions across the company's entire carbon footprint by 2040. As part of its sustainability efforts, T-Mobile—the first U.S. wireless company to set the lofty net-zero goal—also signed The Climate Pledge, a declaration from a community of companies and organizations working towards a more sustainable future by cutting global carbon emissions. Signatories of the Climate Pledge commit to reaching net-zero carbon emissions by 2040, which is ten years ahead of the Paris Agreement.

“As we know, sustainability is important to our customers and stakeholders,” Mike Sievert, T-Mobile CEO, said in a statement. “We are proud that we are doing our part to create a sustainable future for all—including becoming the first in U.S. wireless to set this bold target. And we hope companies like ours—and the partners and suppliers we work alongside—will join us in setting their own aggressive longer-term goals like these.”

ESG goals: PR or pioneer?

There is no doubt that corporate sustainability backed by well-defined goals and targets is paramount to the health of our planet and the success of businesses. Nonetheless, the “greenwashing” stigma of companies posturing for PR is valid, and every company's ESG efforts need to be looked at from the lens of “PR or Pioneer?” Measurement, reporting and accountability are critical factors in determining a company’s “true north” regarding its environmental commitments. Here, we’ll examine whether T-Mobile is simply phoning it in or if its words ring true.

Science-Based Targets Initiative (SBTi) validation undoubtedly indicates that the company's goals are measurable and attainable. T-Mobile is now the first U.S. wireless company to aim for net-zero emissions across all three scopes (defined below). This is validated by SBTi using its Net-Zero Standard, the first framework for company targets that’s in line with current climate science. The SBTi assesses these targets against a set of criteria to determine if they fit with the broader target of limiting global warming to less than 2 degrees Celsius above pre-industrial levels. The validation process helps ensure that the company's targets are ambitious, transparent and aligned with the latest science on the actions that are necessary to address climate change.

T-Mobile’s continued commitment to sustainability

T-Mobile has a history of setting aggressive renewable energy goals and decreasing the company's carbon footprint as outlined in Scope 1 (direct emissions) and Scope 2 (indirect emissions from purchased energy) of the Greenhouse Gas Protocol. The company's net-zero commitment now encompasses Scope 3—addressing the company's entire carbon footprint, Including both direct emissions from T-Mobile's operations and facilities as well as indirect emissions from purchased electricity. This includes customer device usage, shipping materials and fuel, employee transportation and travel and more. This is especially important—and difficult to tackle—because Scope 3 emissions currently account for two-thirds of T-Mobile’s emissions.

T-Mobile announced in January 2022 that it is the first telco to source 100% of its total electricity usage with renewable energy. The company's “circular economy” efforts and commitments across facilities indicate that T-Mobile is minimizing waste and maximizing efficiencies, lowering costs and increasing customer and employee satisfaction. All of this tells me that the company's goals are not greenwashed table stakes or stand-alone initiatives but are integrated into its overall business strategy. It also fits with the insights gained by my colleague Patrick Moorhead, CEO and chief analyst of Moor Insights & Strategy, when he talked a few months ago with T-Mobile's head of corporate responsibility and sustainability.

A call to action for the wireless industry

Why is it so significant that T-Mobile is the first U.S. wireless company to make the net-zero pledge? It boils down to energy consumption, supply chain, network infrastructure and legacy equipment. Telecommunication networks consume significant amounts of energy to support data and traffic growth, resulting in high greenhouse gas emissions. In addition, the industry relies on complex supply chains, contributing to emissions throughout the production and transportation of goods and services.

The deployment of network infrastructure such as cell towers and data centers also results in emissions from construction, energy consumption and waste disposal. What’s more, the telecommunications industry has a large installed base of legacy equipment that must be gradually retired from service and hopefully recycled to be replaced with more energy-efficient alternatives.

2040 is a long way away, and a lot can happen in 17 years, particularly considering the unpredictability of economic conditions. Companies are under increasing pressure to adopt environmentally sustainable and socially responsible practices while also prioritizing business interests and profit. T-Mobile has set some lofty goals in the past, but fortunately tracks its progress publicly and transparently communicates its efforts to improve iteratively.

I look forward to seeing the progress T-Mobile makes toward building a healthier planet, and I hope the company's efforts both set an example and put some pressure on other telcos to follow suit.