Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Renewable Energy
• Nuclear Power
• Carbon Capture and Storage (CCS)
• Energy Efficiency
• Customer Satisfaction
• Safety
• Diversity & Inclusion

Environmental Achievements

• Launched the world's first coal-fired CCS power plant based on oxyfuel technology at Schwarze Pumpe, Germany.
• Continued investments in wind power, acquiring several British wind power companies.
• Goal to halve specific emissions from existing operations from 1990 levels by 2030.
• Climate vision to be climate-neutral by 2050.

Social Achievements

• Improved Customer Satisfaction Index (CSI) score in Nordic countries from 62 to 69.
• Reversed customer loss trend in Germany and increased customer numbers.
• Annual "My Opinion" employee survey conducted.
• International Trainee Programme (VITP) accepted 19 trainees.

Governance Achievements

• Completed redemption of outstanding minority shares in Vattenfall’s German subsidiary.
• Appointed a Chief Nuclear Officer (CNO) to report directly to the CEO on nuclear safety issues.
• Established a Nuclear Safety Council.
• Implemented a Group-wide customer satisfaction index.

Climate Goals & Targets

Environmental Challenges

• Continued outages at German nuclear power plants (Brunsbüttel and Krümmel).
• Higher costs for CO2 emission allowances.
• Economic downturn in Europe.
• Competition for qualified employees.

Mitigation Strategies

• Thorough review of safety work at nuclear power plants.
• Investments in renewable energy and CCS technology.
• Price hedging strategies.
• Talent management program to attract, develop, and retain competent employees.
• Operational Excellence program focusing on productivity improvements.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Code of Conduct for suppliers.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products
• Expansion of renewable energy sources

Reporting Standards

Frameworks Used: GRI

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 13 (Climate action)

Initiatives in renewable energy, CCS, and energy efficiency contribute to these goals.

Sustainable Products & Innovation

• CCS technology
• Renewable energy projects

Awards & Recognition

• Vattenfall Europe named Best in Class Supplier in 2008 by Deutsche Institut für Service-Qualität.

Environmental Metrics

ESG Focus Areas

• Climate change
• Renewable energy
• Electrification
• Digitalization
• Human rights
• Supplier responsibility

Environmental Achievements

• Slightly lower CO2 emissions in 2017 compared to 2016 (22.6 Mt vs 23.2 Mt)
• 354 MW of new renewable capacity installed in 2017 (Sandbank offshore wind farm in Germany, Ray and Pen y Cymoedd onshore wind farms in the UK)
• Phased out coal-fired power generation in Berlin (Klingenberg conversion to natural gas, Reuter C closure)
• Initiated SamEnergi to capture surplus heat from industrial and commercial facilities

Social Achievements

• Improved employee engagement score in annual survey (64% vs 57% in 2016)
• Launched Vattenfall InHouse, providing sustainable energy solutions for property owners and tenant-owner associations
• Updated Code of Conduct for Suppliers
• Performed an evaluation of supply chain for hard coal from Colombia

Governance Achievements

• New financial targets adopted by the owner in December 2017
• New CFO appointed
• Updated Code of Conduct for Suppliers
• Improved integrity reporting and incident management

Climate Goals & Targets

Environmental Challenges

• Low electricity prices putting pressure on traditional business models
• Competition from non-utility actors
• Aging and unreliable distribution networks
• Regulatory risks related to environmental legislation
• Investment risks in renewable energy projects
• Risks associated with data and privacy breaches

Mitigation Strategies

• Investing in renewable power generation, decentralised solutions, grids, and market services
• Improving operational efficiency and cost control
• Increasing investments in distribution networks
• Close cooperation with city partners
• Integrating social and environmental considerations into business and value chains
• Implementing a Group-wide GDPR initiative

Supply Chain Management

Responsible Procurement

• Code of Conduct for Suppliers
• Human rights impact assessments

Climate-Related Risks & Opportunities

Transition Risks

• Decreased or elimination of state subsidies for renewable energy
• Regulatory changes
• Market shifts

Opportunities

• Growth in renewable energy
• Electrification of transport, heating, and industrial processes

Reporting Standards

Frameworks Used: GRI Standards, Core option, UN Global Compact

Certifications: ISO 14001 (nearly 100% of production and distribution portfolios), OHSAS 18001 (all business units), ISO 50001 (seven units)

Third-party Assurance: Ernst & Young AB

UN Sustainable Development Goals

• Goal 7
• Goal 9
• Goal 11
• Goal 12
• Goal 13
• Goal 17

Vattenfall's activities contribute to these goals through renewable energy production, electrification, sustainable cities, responsible consumption and production, climate action, and partnerships.

Sustainable Products & Innovation

• InHouse
• Haus Strom
• Nuon Solar Lease
• Decentralized heating and energy solutions

Awards & Recognition

• Gold rating for sustainability performance by EcoVadis

Environmental Metrics

ESG Focus Areas

• Climate change
• Renewable energy
• Fossil fuel phase-out
• Customer centricity
• Employee engagement
• Biodiversity
• Human rights
• Supply chain responsibility

Environmental Achievements

• Reduced CO2 emissions in Berlin by 50% (three years ahead of schedule)
• Installed 101 MW of new renewable energy capacity
• Achieved 75% share of fossil-free electricity generation
• Reduced CO2 emissions intensity by 4%, from 157 to 150 grams CO2 per kWh

Social Achievements

• Employee Engagement Index at 64%
• Launched OneTonneFuture app to help consumers reduce carbon footprint
• Expanded InCharge e-mobility charging network to over 10,500 points
• Partnered with Volvo Cars on e-vehicle charging solutions

Governance Achievements

• Adopted a new Code of Conduct and Integrity
• Implemented integrity training programs for employees
• Reported 46 integrity-related incidents, 11 leading to disciplinary action

Climate Goals & Targets

Environmental Challenges

• Higher prices of fuel and CO2 emission allowances impacting heat operations
• Negative effects of price hedges on Power Generation earnings
• Two fatal workplace accidents
• Swedish government's decision on regulated revenues for electricity grid operators
• Market volatility in fuel and CO2 markets
• Competition in the renewable energy sector
• Need for greater grid flexibility to accommodate renewable energy sources
• Brexit uncertainty

Mitigation Strategies

• Investing in renewable energy sources (wind, solar, battery storage)
• Implementing a CO2 roadmap to phase out coal by 2030
• Increased focus on safety and exhaustive investigations of accidents
• Continuing to operate hydro and nuclear power plants efficiently
• Developing alternative sourcing strategies
• Cost-cutting program to reduce costs by SEK 2 billion by 2020
• Diversification of portfolio
• Risk management framework and hedging strategies

Supply Chain Management

Responsible Procurement

• Vattenfall Code of Conduct for Suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather conditions (e.g., dry summer, storms)
• Reduced heat demand due to rising temperatures

Transition Risks

• Changes in climate-related policies and environmental regulations
• Competition in renewable energy sector

Opportunities

• Growth in renewable energy
• Electrification of industry and transport

Reporting Standards

Frameworks Used: GRI Standards, Core option, UN Global Compact

Certifications: ISO 14001 (nearly 100% of production and distribution portfolios), OHSAS 18001 or ISO 45001 (all business units), ISO 50001 (six business units)

Third-party Assurance: Ernst & Young AB

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 9 (Industry, innovation and infrastructure)
• Goal 11 (Sustainable cities and communities)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)
• Goal 17 (Partnerships for the goals)

Vattenfall's activities contribute to these goals through renewable energy production, electrification of industry, sustainable energy solutions, and partnerships.

Sustainable Products & Innovation

• Decentralized energy solutions (solar panels, heat pumps, batteries)
• E-mobility charging solutions
• Smart energy solutions
• Fossil-free steel manufacturing (HYBRIT)

Awards & Recognition

• Gold rating from EcoVadis
• Rated as the most sustainable energy company in the Sustainable Brand Index B2B

Environmental Metrics

ESG Focus Areas

• Climate change
• Human rights
• Sustainable supply chain
• Biodiversity
• Resource use
• Employee engagement
• Diversity & Inclusion

Environmental Achievements

• Reduced CO2 emissions to 19.3 Mtonnes from 22.0 Mtonnes (including the heat operations in Hamburg, which were sold in September).
• Installed 474 MW of new renewable capacity (Horns Rev 3 and Slufterdam wind farms).
• Phased out coal from the Hemweg 8 power plant in the Netherlands, reducing annual CO2 emissions by more than 2 million tonnes.
• Closed the coal-fired Reuter C combined heat and power station in Berlin and connected Europe’s largest power-to-heat facility to the district heating network.

Social Achievements

• Improved Employee Engagement Index to 69% from 64%.
• Reduced Lost Time Injury Frequency (LTIF) to 2.1 from 1.9.
• Increased share of female managers to 26% from 24%.
• Acquired DELTA Energie, adding 170,000 customers.

Governance Achievements

• Issued the first green bond of EUR 500 million.
• Implemented the Hearts and Minds approach to improve health and safety culture.
• Launched a new career website and various programs to secure necessary competences.
• Received the Committed to Equality (C2E) Diversity Assured Accreditation at a Gold Standard in the UK.

Climate Goals & Targets

Environmental Challenges

• Major disruptions following Storm Alfrida in Sweden.
• High competition and growth investments affecting electricity sales margins.
• Regulatory uncertainty regarding coal and natural gas phase-out.
• Capacity shortages in the electricity network in parts of Sweden.
• Significantly lower revenue frames for distribution operations in Sweden (2020-2023).
• Legal proceedings regarding electricity network concession in Berlin.
• Increased Lost Time Injury Frequency (LTIF).

Mitigation Strategies

• Intensive work on repairing the electricity network after Storm Alfrida.
• Increased deliveries of fossil-free solutions and customer growth.
• Transparency with stakeholders.
• Investments in electricity networks in Sweden and Berlin.
• Appealing the decision on revenue frames in Sweden.
• Continuing the appeal process for the electricity network concession in Berlin.
• Implementing the Hearts and Minds approach to improve health and safety culture.

Supply Chain Management

Responsible Procurement

• Code of Conduct for Suppliers
• Sustainability requirements in tenders

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Infrastructure damage

Transition Risks

• Changed customer preferences
• Stranded assets
• Brand damage

Opportunities

• Growth in renewables
• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI Standards, Core option, UN Global Compact

Certifications: ISO 14001 (nearly 100% of production and distribution portfolios), OHSAS 18001/ISO 45001 (all business units), ISO 50001 (seven business units)

Third-party Assurance: Ernst & Young AB

UN Sustainable Development Goals

• 7
• 9
• 11
• 12
• 13
• 17

Vattenfall's strategy and purpose reflect the UN's Agenda 2030, particularly the SDGs for Affordable and clean energy, Industry, innovation and infrastructure, Sustainable cities and communities, Responsible consumption and production, Climate action, and Partnerships for the goals.

Sustainable Products & Innovation

• Decentralized energy solutions (solar panels, heat pumps, batteries)
• E-mobility charging solutions
• Power-to-heat technology
• HYBRIT fossil-free steel project

Awards & Recognition

• HYBRIT recognized at the UN climate summit as one of the world’s four most ambitious climate initiatives.
• Committed to Equality (C2E) Diversity Assured Accreditation at a Gold Standard in the UK.

Environmental Metrics

ESG Focus Areas

• Reduce CO2 and phase out fossil fuels
• Provide affordable energy
• Invest in renewable capacity
• Protect nature and biodiversity
• Develop innovative and sustainable solutions for customers
• Minimise emissions of pollutants to air, water and land
• Provide affordable, stable and flexible grid infrastructure

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• climate change
• biodiversity
• sustainable resource use
• employee health and well-being
• human rights
• sustainable supply chain
• integrity

Environmental Achievements

• Reduced absolute CO2 emissions by 55% since 2017.
• Achieved 2-degree SBTi target in 2020, ten years ahead of schedule.
• Set a more ambitious 1.5-degree SBTi target for 2030 and Net Zero target by 2040.
• Immediate landfill ban on decommissioned wind turbine blades.
• Targeting 100% recycling of blade components by 2030.
• Phased out glyphosate use in all operations with a complete ban from 2022.

Social Achievements

• Increased employee engagement index to 75% (reaching the 2025 strategic target).
• Improved lost time injury frequency (LTIF) by 5.6% to 1.7 per million hours worked.
• 39% of all manager hires were female (exceeding the 35% target).
• Implemented a group-wide mental health program.
• Developed a human rights action plan (“11 Steps to 2022”).
• Successfully managed the phase-out of coal-fired power plants, ensuring mutually agreed-upon solutions for all employees.

Governance Achievements

• Established a robust risk management framework.
• Implemented a Vattenfall Integrity Programme (VIP) for managers and relevant staff.
• Improved transparency in tax management and reporting.
• Adhered to the Swedish Corporate Governance Code.
• Completed the sale of Stromnetz Berlin.

Climate Goals & Targets

Environmental Challenges

• Public support for renewable energy and grid investment projects is decreasing.
• Ensuring responsible sourcing of materials, particularly for solar panels.
• Long lead times and permitting processes for building electricity grids.
• Competition for skilled workers.
• Regulatory and market uncertainty regarding the future role of natural gas.
• Opposition to energy infrastructure projects.
• Climate change impacts on assets and operations.
• Liquidity and credit risks due to electricity price volatility.

Mitigation Strategies

• Developing innovative products and services to support customer decarbonisation.
• Investing in employee development and attracting external talent.
• Advocating for policy changes to shorten permitting processes.
• Investing in modernising and weatherproofing the electricity network.
• Implementing a price hedging strategy to manage market price risk.
• Engaging in dialogues with local communities and stakeholders.
• Implementing a robust risk management framework.
• Diversifying the supply chain.

Supply Chain Management

Supplier Audits: 3 site audits conducted for goods and services

Responsible Procurement

• Code of Conduct for Suppliers
• Sustainability requirements in tenders
• Supplier risk assessment tool (SRAT)

Climate-Related Risks & Opportunities

Physical Risks

• Infrastructure damage from extreme weather
• Flooding
• Reduced production due to increased cooling water temperatures
• Supply chain disruptions

Transition Risks

• Changed customer preferences
• Stranded assets
• Brand damage
• Not meeting stakeholder expectations

Opportunities

• Growth in renewables
• Development of energy-efficient products and services
• Flexibility services

Reporting Standards

Frameworks Used: GRI Standards (Core option), Integrated Reporting Framework, UN Global Compact, TCFD

Certifications: ISO 14001, ISO 45001

Third-party Assurance: PricewaterhouseCoopers AB

UN Sustainable Development Goals

• Goal 7
• Goal 9
• Goal 11
• Goal 12
• Goal 13
• Goal 17

Vattenfall's activities contribute to all 17 SDGs, with a particular focus on the six most relevant goals.

Sustainable Products & Innovation

• High-temperature heat pumps
• Biogas offerings
• Flexible charging software for electric vehicles

Awards & Recognition

• EcoVadis Platinum rating
• CDP A- rating

Environmental Metrics

ESG Focus Areas

• Renewable energy
• Climate change and GHG emissions
• Affordable energy
• Biodiversity
• Human rights

Environmental Achievements

• Reduced Scope 1+2 emissions by 7% compared to 2021 and 13.7 Mt of CO2e since 2017
• Reduced Scope 3 GHG emissions by 25% compared to 2021
• Reduced water-use intensity by 5% compared to 2021
• Generated 7% less waste compared to 2021, and recycled 21%
• Emissions from own operations decreased by 51% since 2017

Social Achievements

• Employee engagement index at 80% (75% in 2021)
• Reduced Lost Time Injury Frequency to 1.1 from 1.7 in 2021
• Berlin Office named most Sustainable Office Building in Germany

Governance Achievements

• Updated Human Rights Policy
• 2,119 managers and other relevant employees attended integrity training
• 55 integrity-related incidents reported in 2022

Climate Goals & Targets

Environmental Challenges

• High electricity prices and high inflation
• Supply chain disruptions due to climate events
• Regulatory instability
• Competition for talent
• Managing stakeholders’ disparate expectations

Mitigation Strategies

• Helping customers with advice on energy saving
• Taking steps to save energy in own operations
• Expanding renewable capacity
• Improving ability to attract and develop talent
• Increased transparency and stakeholder engagement

Supply Chain Management

Responsible Procurement

• Code of Conduct for Suppliers and Partners
• Sustainability requirements in tenders

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Water scarcity
• Wildfires

Transition Risks

• Loss of revenue from fossil fuel assets
• Stranded assets
• Policy/regulatory changes

Opportunities

• Increased demand for renewable energy
• Partnerships to reduce climate impacts

Reporting Standards

Frameworks Used: GRI Universal Standards 2021, UN Global Compact

Certifications: ISO 14001, ISO 45001

Third-party Assurance: PricewaterhouseCoopers AB

UN Sustainable Development Goals

• Goal 7
• Goal 9
• Goal 11
• Goal 12
• Goal 13
• Goal 17

Vattenfall's contributions to the SDGs are described in the report.

Sustainable Products & Innovation

• High-temperature heat pump

Awards & Recognition

• Two gold awards in the International Customer Experience Awards 2022

Environmental Metrics

ESG Focus Areas

• Driving decarbonisation with our customers & partners
• Securing a fossil-free energy supply
• Delivering high-performing operations
• Empowering our people

Environmental Achievements

• Vattenfall's goal of net-zero emissions by 2040 has been approved by the Science Based Targets initiative
• Sale of Berlin heat business to the State of Berlin, ensuring responsible operation with a focus on reduced carbon dioxide emissions.
• Continued progress on Vattenfall’s district heating project near Edinburgh, UK, providing low carbon heat to 3,000 homes, schools and retail buildings.

Social Achievements

• Increased electricity sales as more customers choose Vattenfall (customer base increased by 5% to 11.4 million contracts)
• Continued expansion of charging networks for electric vehicles with agreements signed in both Germany and Sweden
• Partnership with Kia in the Netherlands to provide sustainable energy solutions and alleviate grid congestion
• Acquisition of Meiners Elektrotechnik in Germany expanding heat pump installation capacity.
• Employee Engagement Index ≥75%

Governance Achievements

• The Board of Directors proposes a dividend of SEK 4 billion for 2023.
• The Swedish Energy Market Inspectorate has decided on the model and WACC for the revenue frames for electricity grid operators for the period of 2024-2027

Climate Goals & Targets

Environmental Challenges

• Significantly lower electricity prices in Europe compared to 2022 (average 60% lower)
• Lower volumes from hydro power and lower availability for nuclear power
• Negative contribution from price hedges on the Continent
• Lower electricity prices both in the Nordics and on the Continent
• Reduced price area differences compared to 2022
• Temperature effects impacting sales volume
• Delayed restart of Ringhals 4 and lower availability of Forsmark 2 (nuclear power)
• Sale of the Magnum gas-fired power plant in the Netherlands
• Temporary reduction in the electricity grid fee during the period 1 July–31 December 2023

Mitigation Strategies

• Strategic divestments of the heating operations in Berlin and wind power projects off the coast of Norfolk in the UK, strengthening preparedness for future investments.
• Vattenfall partly hedges the electricity generation; positive contribution from Nordic price hedges offset by negative contribution from continental hedges.
• Price adjustments for heat in Berlin and the Netherlands compensating for higher fuel costs in 2022.
• Increased investments in local and regional grids to meet increased demand.
• New framework agreement for technical consulting services to manage electricity network expansion.
• Participation in a research project to evaluate vehicle-to-grid technology to enhance grid stability.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Science Based Targets initiative