Ikea Group, the world’s biggest furniture retailer, will double its investment in renewable energy to $4 billion by 2020 as part of a drive to reduce costs as cash-strapped consumers become more price sensitive.
The additional spending on projects will be needed to keep expenses down as the company maintains its pace of expansion, Chief Executive Officer and President Mikael Ohlsson said in an interview in Malmo, Sweden.
“I foresee we’ll continue to increase our investments in renewable energy,” said Ohlsson.
Companies from sportswear maker Puma to drinks producer PepsiCo are expanding efforts to cut their use of scarce resources as they jostle for customers.
Ikea plans to get 100 percent of the energy consumed at its stores and by subcontractors from renewable sources by 2020. The Almhult, Sweden-based company owns 250,000 solar panels, mainly in the U.S., and invested in 126 wind turbines in northern Europe to cover 34 percent of its energy consumption.
In October, Ikea said it planned to more than double spending on wind farms and solar parks to as much as $2 billion to have the company cover more than 70 percent of its energy consumption by renewable sources in 2015 and protect it from volatile fossil-fuel prices.
The retailer is expanding its product range for customers to live more sustainable lives themselves, focusing on waste handling and cutting energy and water use.
“For now, we’re mainly focusing on the big parts of resource use at home,” Ohlsson said, adding that Ikea is testing some solar solutions for customers in the U.K., he said