Back to Overview

Climate Impact

Introduction

Climate change is a global challenge that Scatec’s core business aims to address.

Policymakers are increasingly looking to renewable energy when tendering for new power generation to tackle climate change and due to declining costs. Scatec's main purpose is to develop solar, wind and hydro power plants to meet this need. We own and operate the power plants for about 20–25 years providing cheap, reliable and emission free electricity in growth markets. We acknowledge that our business activities have a carbon footprint and therefore account and report on our total direct and indirect emissions in accordance with the Greenhouse Gas (GHG) Protocol. We are also increasingly being impacted by climate change and therefore evaluate climate-related risks to, and opportunities for our people, business and physical assets.

Management approach

We are committed to reducing our direct and indirect greenhouse gas (GHG) emissions in line with what is required to limit global heating to under 1.5 degrees and achieving net zero emissions by 2040. We systematically seek to reduce and eliminate our direct greenhouse gas emissions through operational and technological means where practically feasible.

See more

We are committed to reducing our direct and indirect greenhouse gas (GHG) emissions in line with what is required to limit global heating to under 1.5 degrees and achieving net zero emissions by 2040. We systematically seek to reduce and eliminate our direct greenhouse gas emissions through operational and technological means where practically feasible. We work with our suppliers to ensure that they are working to reduce their GHG emissions. We monitor our climate risk exposure, carry out regular scenario analysis and mitigate risks identified.

The Chairman has the highest climate-related responsibility among the Board of Directors. The Executive Management Team, led by the CEO, is responsible for assessing and managing climate-related risks and opportunities. The team reports directly to the Board of Directors on a monthly basis.

Our process of identifying and assessing climate-related risks are integrated into our multi-disciplinary company-wide risk management process. We have extensive policies and procedures in place as part of our operating system to actively manage risks related to the various parts of the Company’s operations.

We reviewed climate risks and opportunities for our portfolio aligned with the Task Force on Climate related Financial Disclosures (TCFD) recommendations during 2021. Interviews and workshops were held with internal stakeholders to identify potential climate risks and opportunities for Scatec. Transitional opportunities from access to new markets and increased demand for our low-carbon energy production were confirmed as most material issues for Scatec, with physical risks from extreme weather being the most material risk.

To assess transitional opportunities, we use tools such as Bloomberg New Energy Finance’s New Energy Outlook (BNEF NEO) to inform our strategy and business decisions. We assessed physical climate risk exposure of our own operated power plants in 2021 using climate scenario data from the World Bank Climate Change Knowledge Portal . Extreme heat exposure was assessed for each operational site looking at increase in days with temperatures over 35 degrees in 2040-2059 in RCP 8.5 (high emission) and RCP 4.5 (intermediate emission) scenarios. Extreme rainfall risk was assessed by looking at change in maximum 5-day rainfall for the same locations, scenarios and time frames. The results were combined with our existing natural catastrophe risk database to increase understanding of related risks across our project portfolio.

Scatec’s lifecycle greenhouse gas emissions intensity versus global average by electricity generation technology

The figure above shows the results from a 2021 lifecycle assessment of our solar power plants and hydropower investments.

Our power plants have very low emissions compared to other electricity generation technologies even considering all the inputs to construction and operation. Our hydropower investments have very low lifecycle emissions by global standards and our solar power plants are aligned with global averages.

Key figure assumptions
Source of global average emissions factors is IPCC, AR5 WG3.
Scatec solar emission intensity is based on Scatec’s internal lifecycle analysis of Boguslav 54 MW solar plant in Ukraine. This is likely higher than for most other Scatec solar power plants globally, as most are located in areas with higher irradiation compared to Ukraine.

The key assumption is based on a 20-year operational lifetime (based on the Power Purchase Agreement, PPA) but it is possible that many power plants could operate beyond the PPA. Several of our PPAs have a time period of up to 25 years. The solar calculation does not include potential biogenic emissions from land use change.

Scatec’s hydropower factor is based on an average across Scatec joint venture hydropower plants assessed by the IHA using the G-res tool (run of river Maris Hydro plant is not included).

Scatec climate roadmap

Plotting a course for net zero by 2040

As the climate crisis worsens, it is becoming increasingly clear that it is necessary for all actors to cut emissions as fast as possible and ultimately reach net zero emissions. Scatec has therefore developed an ambitious climate target aligned with the Science-based Target net zero requirements, set by the Science Based Target Initiative (SBTi).

Read more

GRI 305-3

Direct (Scope 1) greenhouse gas emissions

a. Total Scope 1 emissions: 916 tCO2e

b. Greenhouse gas emissions include CO2, CH4 and N2O and SF6.

c. No biogenic sources are reported currently (no biofuel used). However, emissions from land use change may be reported in future based on upcoming changes to the GHG Protocol.

d. 2019 base year emissions were 1,846 tCO2e and was chosen as it is first year Scatec included material Scope 3 emissions.

e. The GWPs used in the calculation of tCO2e are based on the Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment Report (AR4) over a 100-year period. CO2 = 1, CH4 = 25, N2O = 298
The sources of the emission factors are described in the Greenhouse gas accounting methodology section below.

f. Consolidation Approach: Operational control

g. Standards, methodologies and assumptions: Refer to the Greenhouse gas accounting methodology section below.

GRI 305-1: direct greenhouse gas emissions

Direct GHG emissions (scope 1)UnitActual 2021Actual 2020Actual 2019
Total GHG emissionstCO2e9167551,846

GRI 305-2

Energy indirect (Scope 2) greenhouse gas emissions

a. Location-based: 4,952 tCO2e

b. Market-based: 3,763 tCO2e

c. Electricity factors include CO2, CH4 and N2O

d. 2019 base year emissions were 5,109 tCO2e (same for market and location based) and was chosen as it is first year Scatec included material Scope 3 emissions.

e. The GWPs based on IPCC Fourth Assessment Report (AR4) over a 100-year period. CO2 = 1, CH4 = 25, N2O = 298
The sources of the emission factors are described in the Greenhouse gas accounting methodology section below.

f. Consolidation Approach: Operational control

g. Standards, methodologies and assumptions: Refer to the Greenhouse gas accounting methodology section below.

GRI 305-2: Energy indirect greenhouse gas emissions

Energy indirect GHG emissions (scope 2)UnitActual 2021Actual 2020Actual 2019
Total location-based GHG emissionstCO2e4,9525,6885,109
Total market-based GHG emissionstCO2e3,7632,9095,109

GRI 305-3

Other indirect (Scope 3) greenhouse gas emissions

a. Total Scope 3 emissions: 25,110 tCO2e

b. All emission factors are in tCO2e and include CO2, CH4 and N2O

c. No indirect biogenic emission sources we can report on

d. Scope 3 emissions are calculated for the following activities; business travel and well-to-tank activities.

e. 2019 base year emissions were 241,294 tCO2e and was chosen as it is first year Scatec included material Scope 3 emissions.

f. The GWPs based on IPCC Fourth Assessment Report (AR4) over a 100-year period. CO2 = 1, CH4 = 25, N2O = 298
The sources of the emission factors are described in the Greenhouse gas accounting methodology section below.

g. Standards, methodologies and assumptions: Refer to the Greenhouse gas accounting methodology section below.

GRI 305-3: Other indirect greenhouse gas emissions

Other indirect (Scope 3) greenhouse gas emissionsUnitActual 2021Actual 2020Actual 2019
Total air traveltCO2e5497393,658
Total well-to-tanktCO2e1,994 (1)2,171 (1)2,367 (1)
Total purchased capital goodstCO2e19,6262,604 (2)227,390 (2,3)
Total upstream transportationtCO2e8271,1227,652 (2)
Total waste generatedtCO2e513422
Total employee commutingtCO2e912294201
InvestmentstCO2e1,202N/AN/A
Scope 3 totaltCO2e25,1105,954241,249
Total (Scope 1, Scope 2 market based and Scope 3)tCO2e29,7899,618248,249

(1) Well to tank emissions restated to include upstream electricity emissions and losses for all countries

(2) 2020 and 2019 capital goods and upstream transport restated to include Release projects

(3) Capital goods emissions in 2019 were higher than in 2020 and 2021 due to significant procurement activities. Emissions in 2022 are expected to be of a similar size due to new projects under development.

“We have worked consistently this year to sustain our A score in CDP for 2021. Key initiatives such as measuring the lifecycle emissions of our hydropower projects, engaging with key suppliers and further developing our climate targets have been high on our agenda. We have extremely dedicated colleagues globally who contribute to this recognition”, says Julie Hamre, VP ESG Reporting & Strategy.

Commuter survey

At the end of 2021, we carried out a global employee commuter survey to better understand how our employees get to and from work, and the climate impact from this.

Read more

Scatec climate cup 2021

Scatec arranged a two-week competition to boost knowledge of our climate strategy and raise awareness of what can be achieved with just a few adjustments to behaviour at home and at work.

Read more

Greenhouse gas accounting methodology

Scatec calculates and reports our GHG emissions according to the Greenhouse Gas Protocol  “A Corporate Accounting and Reporting Standard, Revised edition” and the “Corporate Value Chain (Scope 3) Accounting and Reporting Standard”. The Global Warming Potential (GWP) used in the calculation of carbon dioxide-equivalents (CO2e) are based on the Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment Report (AR4) over a 100-year period.

See more

The carbon inventory is divided into three main scopes of direct and indirect emissions.

Scope 1 includes all direct emission sources. This includes all use of fossil fuels for stationary combustion resulting from onsite backup generators, transportation (in owned, leased, or rented vehicles), and fugitive emissions of sulphur hexafluoride (SF6) from electrical equipment. Emission factors used for fuels are from the Department for Environment, Food, and Rural Affairs (DEFRA), 2021. Data is collected monthly and reported externally on an annual basis.

Scope 2 includes indirect emissions related to purchased energy. These GHG emissions are reported for offices and onsite maintenance facilities. The electricity emission factors are based on national gross electricity production mixes from the International Energy Agency’s  statistics (IEA Stat). Emission factors per fuel type are based on assumptions in the IEA methodological framework. Primarily two methods are used to “allocate” the GHG emissions created by electricity generation to the end consumers of a given grid. These are the location-based and the market-based methods. The location-based method reflects the average emission intensity of the grids on which energy consumption occurs. The market-based method reflects emissions from electricity that companies have purposefully chosen (or not chosen). Our Scope 2 emissions are reported using both methods. Data is collected monthly and reported externally annually.

Scatec purchases International Renewable Energy Certificates (I-RECs). In 2021, 2,394 MWh of I-RECs were purchased in Egypt from the special purpose vehicle (SPV) responsible for our Benban power plant. Each I-REC represents proof that 1 MWh of renewable energy has been produced and includes the environmental benefits this renewable energy has generated. Scatec also consumes own generated renewables on most sites, but this is not always measured.

Scope 3 includes indirect emissions resulting from value chain activities and the GHG emissions are a result of the company’s upstream and downstream activities. Emissions from capital goods are calculated based on procurement figures and best available emissions factors (either standard values or environmental product declarations (EPDs)). Emissions for purchased goods and services, such as from construction are based on actual activity data collected by contractors (construction emissions are reported under Scope 1 when Scatec is the engineering, procurement and construction (EPC) sub-contractor building the plant). Fuel- and energy-related activities (not included in scope 1 or scope 2) are calculated based on scope 1 and 2 activity data using emission factors per fuel type are based on assumptions in the IEA methodological framework. Upstream transportation and distribution is calculated using the EcoTransIT online calculator based on actual volumes transported from manufacturer port of origin to site. Business travel emissions are based on data gathered by and received from Scatec’s travel agencies. Employee commuting emissions are calculated based on data collected from an employee survey and Defra emission factors. Investments are calculated based on equity share of scope 1 and 2 emissions Waste data is estimated by a third party based on the total number of permanent employees. Data is collected and reported externally on an annual basis.

Responsible supply chain

Resource use and circularity

Diversity and inclusion

Local value creation

Human rights

Health, safety and security

Ethical business conduct

Biodiversity

Water management

Reports

Report from the Board of Directors

Download Corporate Governance Report Statement on equality and non-discrimination