EPH on its decarbonisation pathway: securing the stability of supply and focusing on hydrogen-ready projects
4. 7. 2023
We are glad to present our eighth sustainability report, which depicts the very challenging and volatile year 2022. EPH Group faced an unprecedented situation, similar to other industry peers when the need to ensure power supplies and grid stability proved crucial. We are proud that we succeeded in both of these goals. Despite the near-term challenges posed by the military invasion of Ukraine for energy security in Europe, we are convinced that the energy system development will continue to be driven by long-term EU decarbonisation goals. EPH believes that our aim to reduce our carbon footprint by 60% by 2030 and achieve carbon neutrality by 2050 shall remain valid.
“We have made substantial investments in several state-of-the-art flexible hydrogen-ready power generation plants. Significant projects include the Kilroot gas power plant in the UK, with nearly 700 MW of capacity, and two gas power plants in Tavazzano and Ostiglia, Italy, with a capacity of 800 MW and 880 MW, respectively. Together with other planned investments in new-build gas development projects in the UK and the Republic of Ireland, we are planning to spend approximately €2.3 billion, resulting in a total installed capacity of 4.4 GW of flexible low-emission power, crucial for European energy transition. This shall complement our existing portfolio of zero or low-carbon-intensive sources. ” said Daniel Křetínský, CEO and Chairman of the EPH Board of Directors.
Besides generation assets, our gas infrastructure significantly contributed to the security of supply in Europe. Particularly the storage facilities helped to mitigate potential disruptions with more than 64 TWh of storage capacity. EPH acknowledges the temporary role of natural gas considering the EU decarbonisation goals and is aware of the need to gradually replace it with renewable gases such as biomethane or hydrogen. We believe that hydrogen will play an important role in the European energy market to ensure energy system stability in a zero-carbon future. EPH aims to play a leading role in the transition to hydrogen future as its infrastructure is optimally positioned to secure transit, storage, and distribution of hydrogen and other alternative gases. In 2022, the share of low or zero carbon emissions business on the Group’s total sales was 91%.
To accelerate the energy transition, the lignite operations in Germany shall be transferred into a new sister company, EP Energy Transition. This company will have a clearly defined transition strategy and plans to invest around €10 billion into the development of renewable energy sources, batteries and highly-efficient hydrogen-ready power plants. As a result, EPH will be almost free from all of its current coal assets by 2025 and will completely abandon coal as a power generation source by 2030.
Gary Mazzotti, ESG Officer of EP Infrastructure and EP Power Europe, concluded: “The power generation business transformation cannot happen without a robust gas infrastructure ensuring grid stability and supply. We are also aware of the social aspects of the energy transformation and remain dedicated to providing a safe and stable environment for our employees and understand our responsibility towards the communities in which we operate, striving to maintain as many jobs as possible.”
EPH’s robust management of ESG risks and its implementation of suitable policies, programs, and initiatives was reflected in a strong ESG risk rating of 21.3 received in December 2022 from Morningstar Sustainalytics. This result represents an improvement in the score (the lower score, the better) from 22.0 received previously and confirms EPH’s position in the medium-risk category. EPH secured 17th position out of over 80 companies from the multi-utilities sector.
The full version of the EPH Sustainability Report, with many interesting case studies, can be found here.