Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• Water Quality
• Customer Affordability
• Employee Wellbeing
• Community Engagement
• Supply Chain Sustainability
• Governance

Environmental Achievements

• Reduced leakage by 4% in 2019/20, exceeding 6% commitment ODI target; Reduced leakage by over 8% over last five years; Improved biodiversity in over 244 hectares of SSSI-designated land over the last five years; Reduced greenhouse gas emissions by 7% compared to 2018/19 and 45% compared to 2014/15; Achieved 100% renewable energy commitment 10 years earlier than planned; Implemented policy to only purchase electric cars from now on and only electric vans from 2023; Waste audit completed providing better visibility of waste streams, with some waste streams as high as 99% diverted from landfill; Recycled over 115,000 tonnes of dry solids to agricultural land in 2019.

Social Achievements

• Supported around 70,000 customers through social tariffs and assistance schemes; Launched a COVID-19 £1 million emergency fund to support charities and non-profit organisations; Employee engagement score of 8.1/10, placing Severn Trent in the top 5% of utilities globally; 43% of new starters and 39% of promoted employees live in a social mobility cold spot; Launched a ‘Caring for our Colleagues’ campaign, providing support on mental and physical wellbeing; Nearly 1,500 employees volunteered; Raised over £120,000 for WaterAid.

Governance Achievements

• New Purpose and Values co-created with employees; Launched Sustainable Finance Framework and raised £200 million through US Private Placement debt issuance; Received Fair Tax Mark accreditation; Accredited as a real Living Wage employer; Improved ranking in the Stonewall Workforce Equality Index; Seven independent Board members, including the Chair; 56% Board members are female; 11% Board members are from a BAME background.

Climate Goals & Targets

Environmental Challenges

• Sewer flooding incidents increased due to severe weather; Challenging year in some areas of waste performance; Impact of COVID-19 on cash collection, non-household customer consumption, and bad debt costs; Impact of COVID-19 on non-household retail joint venture, Water Plus; Shortage of STEM expertise within the labour market and future talent pipelines; Climate change impacts on assets and infrastructure; Funding deficit of defined benefit pension schemes; Potential for regulatory penalties for not meeting operational performance targets; Risk of cyber attacks; Risk of extreme weather events.

Mitigation Strategies

• Developed revised working practices, virtual remote technicians, at-home network monitoring, and kept small teams together to ensure safety during COVID-19; Made £3.5 million available as part of Severn Trent Trust Fund for those unable to pay bills; Implemented improvement plans for sewer flooding; Developed updated assessment of prospects allowing for anticipated impacts of COVID-19; Strong financial position to withstand economic shocks; Significant investment to improve resilience of assets; Robust cyber security defenses; Contingency and future investment plans reviewed using ‘Extreme Flood Outline’ data; Additional hedging arrangements to reduce impact of fluctuations in interest rates and inflation on pension schemes liabilities; Continued outperformance on financing; Cleanest Water Plan to drive improvements across network; ‘Prevent, Restore, Repair’ strategy to improve supply interruptions; Innovative ways of finding and fixing leaks more efficiently; Catchment-based approaches to manage impact on river systems; Investing in energy generation opportunities; Developing new, more environmentally sustainable water sources.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Sustainable Supply Chain Charter; Prompt Payment Code; Real Living Wage mandatory in all future contracts.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events; Flooding

Transition Risks

• Regulatory changes; Market shifts

Opportunities

• Aquifer recharge; Increased biological treatment

Reporting Standards

Frameworks Used: GRI

Certifications: Carbon Trust Standard

Third-party Assurance: Deloitte

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)

Initiatives contribute to these goals through water conservation, renewable energy generation, and carbon emission reduction.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Gold for ‘Most Effective Digital Customer Experience’ at the European Contact Centre and Customer Service Awards; Top three for women’s representation amongst the Executive Committee and their direct reports in the Hampton-Alexander Review; Top three companies in the Social Mobility Index; Fair Tax Mark; Carbon Trust Standard.

Environmental Metrics

ESG Focus Areas

• Climate Change
• Water Resource Management
• Wastewater Management
• Renewable Energy
• Biodiversity

Environmental Achievements

• Reduced leakage by 2.2%
• Generated 267 GWh renewable energy
• Self-generated 53% of energy needs from renewables
• Reduced net operational emissions (market based)

Social Achievements

• Launched employee electric vehicle scheme
• Published first standalone Sustainability Report in 2020
• Engaged with 800,000 customers on water efficiency

Governance Achievements

• Established board-level oversight of climate-related issues
• Created Corporate Sustainability Committee
• Submitted Scope 1, 2, and 3 Science Based Targets to SBTi
• Updated Corporate Sustainability Committee’s Terms of Reference to include greater focus on climate change

Climate Goals & Targets

Environmental Challenges

• Increased indirect costs from rising mean temperatures and reduced water availability
• Increased direct costs from increased severity and frequency of extreme weather events
• Increased direct costs from potential carbon pricing mechanisms
• Increased indirect costs from increased stakeholder concern or negative stakeholder feedback

Mitigation Strategies

• Extensive water resource management planning, including leakage reduction, demand management, and increasing water source capacity
• Drainage and Wastewater Management Plan with proposals for increasing sewer network capacity and sustainable drainage solutions
• Triple Carbon Pledge committing to net-zero operational carbon emissions, 100% renewable energy, and an all-electric fleet by 2030
• Investment in sustainability initiatives, including planting 1.3m trees and boosting biodiversity of 5,000 hectares of land

Supply Chain Management

Supplier Audits: 100% of suppliers assessed against standard environmental criteria, including climate change

Responsible Procurement

• Sustainable Supply Chain Charter
• Mandatory carbon reduction requirements in Design Manual

Climate-Related Risks & Opportunities

Physical Risks

• Rising mean temperatures
• Increased severity and frequency of extreme weather events

Transition Risks

• Carbon pricing mechanisms
• Increased stakeholder concern

Opportunities

• Access to new markets for renewable energy
• Increased investor confidence
• Reduced direct costs from more efficient production and distribution processes

Reporting Standards

Frameworks Used: TCFD, Science Based Targets initiative

Certifications: Carbon Trust Standard

Third-party Assurance: Carbon Trust

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 6 (Clean Water and Sanitation)
• Goal 13 (Climate Action)

Initiatives contribute to these goals through renewable energy generation, water resource management, and carbon emission reduction

Sustainable Products & Innovation

• Renewable energy generation from food waste, crop, solar, wind, and hydro schemes

Environmental Metrics

ESG Focus Areas

• Climate Change
• River Health
• Affordability
• Biodiversity
• Social Mobility
• Diversity & Inclusion

Environmental Achievements

• Improved biodiversity of over 4,600 hectares in the last two years.
• Generated a record total renewable energy of 507 GWh, equivalent to 52% of electricity use.
• Achieved 4* EPA status from the Environment Agency for the last two years.
• Reduced leakage by 3.5% since 2020.
• Reduced the number of pollutions by 30% this AMP.
• Operational net zero emissions including 100% renewable energy and an all-electric fleet (where available) by 2030.

Social Achievements

• Launched 100,000 Employability Hours Scheme, offering free skills and training.
• Donated c.£2 million to 73 community projects through Severn Trent Community Fund.
• Launched Affordability Strategy to support an additional 100,000 customers in water poverty.
• Supported around 215,000 customers through financial schemes.
• Launched ‘Wonderfully You’ Diversity and Inclusion Strategy and associated targets.
• Improved customer experience scores, with all nine customer service measures green.

Governance Achievements

• Confirmed Science-Based Targets in line with a 1.5°C pathway.
• Announced commitment to ‘Get River Positive’ with five River Pledges.
• Linked River Pledges to remuneration structures.
• Included ESG measures into bonus scheme metrics and carbon reduction measures within the LTIP.
• Published Strategic Direction Statement outlining long-term vision.

Climate Goals & Targets

Environmental Challenges

• Heightened focus on river quality.
• Increasing number of customers in water poverty.
• Rising energy prices and inflation impacting costs and customer bills.
• Supply chain disruptions due to geopolitical instability and COVID-19.
• Climate change impacts on water supply and waste water treatment.
• Cybersecurity threats.

Mitigation Strategies

• Launched ‘Get River Positive’ commitment with five River Pledges.
• Launched Affordability Strategy with £30 million funding.
• Invested in renewable energy generation (50% of electricity use).
• Improved supply chain resilience through diversification and alternative sourcing.
• Developed comprehensive resilience plans (WRMP, DWMP) to address climate change impacts.
• Implemented robust cybersecurity measures and training.

Supply Chain Management

Supplier Audits: 35 suppliers assessed through EcoVadis.

Responsible Procurement

• Sustainable Supply Chain Charter
• EcoVadis platform
• Net 15% biodiversity gain requirement for site construction works

Climate-Related Risks & Opportunities

Physical Risks

• Droughts
• Floods
• Extreme temperatures
• Increased rainfall intensity

Transition Risks

• Regulatory changes
• Changes in consumer behavior
• Carbon pricing

Opportunities

• Renewable energy generation
• Water efficiency improvements
• Development of energy-efficient products

Reporting Standards

Frameworks Used: TCFD, Science Based Targets initiative

Certifications: Carbon Trust Standard

Third-party Assurance: Jacobs

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 15 (Life on Land)

Initiatives contribute to these goals through water resource management, renewable energy generation, emissions reduction, and biodiversity enhancement.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• CDP Climate Change 'A List'
• Awards for Excellence in Recycling and Waste Management

Environmental Metrics

ESG Focus Areas

• Climate Change
• River Health
• Affordability
• Biodiversity
• Social Impact
• Diversity & Inclusion
• Governance

Environmental Achievements

• Reduced share of Reasons for Not Achieving Good Status (RNAGS) in region from 24% to 16%
• Reduced average storm overflow activations from 25 in 2021 to 18 in 2022
• Exceeded biodiversity target of improving 5,000 hectares of land four years early, achieving over 7,700 hectares
• Doubled biodiversity target to 10,000 hectares by 2025
• Generated 548 GWh of renewable energy
• Achieved Advancing Tier for the Carbon Trust Route to Net Zero Standard

Social Achievements

• Launched ten-year Societal Strategy aimed at helping change the lives of 100,000 people
• Launched £30 million affordability package to support customers struggling with cost of living
• Supported 132,296 customers through affordability schemes
• Improved employee engagement score to 8.4 out of 10 (top 5% of global utilities)
• Reduced Lost Time Incidents (LTIs) to 16 (best ever performance)
• Continued to narrow gender pay gap

Governance Achievements

• Increased weighting of environmental measures in Executive annual bonus plan to 20% (increasing to 30% for 2023/24)
• Four new equally-weighted carbon measures added to 2023-26 Long-Term Incentive Plan (LTIP)
• Appointment of Sarah Legg as Independent Non-Executive Director and member of the Corporate Sustainability Committee

Climate Goals & Targets

Environmental Challenges

• High inflation driving increases in energy costs
• Continued impact of geopolitical events
• Affordability pressures for customers
• River health concerns
• Extreme weather events (hot, dry summer and freeze-thaw event)
• Missed stretching target for external sewer flooding

Mitigation Strategies

• Investment in network resilience
• Demand management campaigns
• Affordability strategies and financial support packages
• Get River Positive river pledges and investments
• Investment in new technologies and infrastructure
• Insourcing of critical teams (e.g., Network Response Team)
• Improved planning and scheduling functions

Supply Chain Management

Supplier Audits: 89 suppliers assessed through EcoVadis

Responsible Procurement

• Sustainable Supply Chain Charter
• Real Living Wage for suppliers
• Prompt Payment Code adherence
• Sustainable Procurement Statement

Climate-Related Risks & Opportunities

Physical Risks

• Drought
• Flooding
• Extreme temperatures
• Storm events

Transition Risks

• Stricter environmental regulations
• Increased carbon pricing
• Changing customer expectations

Opportunities

• Investment in renewable energy
• Development of energy-efficient technologies
• New markets in green hydrogen or ammonia

Reporting Standards

Frameworks Used: TCFD

Certifications: Carbon Trust Route to Net Zero Standard (Advancing Tier)

Third-party Assurance: Jacobs

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 15 (Life on Land)

Initiatives contribute to these goals through water resource management, renewable energy generation, carbon emission reduction, and biodiversity enhancement

Sustainable Products & Innovation

• Net Zero waste water treatment hub

Awards & Recognition

• Biodiversity Champion Award (Responsible Business Awards)
• Partnership Award (Chartered Institute of Ecology and Environmental Management Awards)
• Net Zero Award (Anaerobic Digestion & Biogas Industry Awards)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Water Resources
• Wastewater Management
• River Health
• Biodiversity
• Affordability
• Social Impact
• Governance

Environmental Achievements

• Achieved EPA 4* for the fourth consecutive year.
• Reduced share of RNAGS to 14%.
• Invested £1.2 billion in capital projects, bringing the total investment this AMP to over £3 billion.
• Reduced leakage to lowest ever annual levels of 380.7 Ml/d.
• Installed over 111,000 smart water meters.

Social Achievements

• Launched 10-year Societal Strategy to support 100,000 people in or at risk of poverty.
• Donated over £2 million to over 100 organizations in the region.
• Achieved an employee engagement score of 8.6 out of 10.
• Increased affordability support to £550 million.

Governance Achievements

• Severn Trent achieved first place as the best performing FTSE100 company for representation of women on the Board.
• First company in the FTSE100 to have a female Chair, CEO and CFO.
• Incorporated Social Value into the proposed Remuneration Policy.

Climate Goals & Targets

Environmental Challenges

• Challenging weather conditions, including 10 named storms and record high river levels.
• Increase in wastewater volumes.
• Missed targets on total pollutions, sewer flooding, and spills from storm overflows.
• Barlaston pollution incident resulting in a £2 million fine.

Mitigation Strategies

• Implemented a ‘first responder’ strategy to enhance incident handling capacity.
• Developed a new vulnerable customer process.
• Established a documented Storm Readiness approach.
• Invested in long-term resilience through the PR24 Business Plan (£12.9 billion investment).
• Implemented measures to prevent future pollutions (Barlaston incident).

Supply Chain Management

Supplier Audits: 100% of contracted suppliers signed up to the Sustainable Supply Chain Charter

Responsible Procurement

• Sustainable Supply Chain Charter
• Code of Conduct
• Modern Slavery commitments
• Real Living Wage

Climate-Related Risks & Opportunities

Physical Risks

• Drought
• Flooding
• Extreme weather events

Transition Risks

• Increased regulatory scrutiny
• Carbon taxes
• Changing consumer behavior

Opportunities

• Investment in renewable energy
• Leakage reduction
• Demand management
• Innovation in wastewater treatment

Reporting Standards

Frameworks Used: TCFD, EU Taxonomy, SASB

Certifications: Carbon Trust Route to Net Zero Standard (Advancing Tier)

Third-party Assurance: Jacobs (GHG data); DNV Business Assurance Services UK Limited (EU Taxonomy)

UN Sustainable Development Goals

• Goal 6 (Clean Water and Sanitation)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)
• Goal 15 (Life on Land)

Initiatives contribute to these goals through water resource management, renewable energy generation, emissions reduction, and biodiversity conservation.

Sustainable Products & Innovation

• Renewable energy from food waste
• Biofertiliser

Awards & Recognition

• Fair Tax Mark
• Princess Royal Training Award
• Race Equality Matters Bronze Trailblazer Status
• Engineering & Manufacturing Employer of the Year (Multicultural Apprenticeship Awards)