- in addition, new low-carbon energy solutions may induce new societal questions (new intrusive technologies, land rights-of-way, new conflicts related to the use of water or scarce resources, etc.)
- the publication in May 2021 of the International Energy Agency’s (IEA) Net Zero scenario sets 2040 as the new target for decarbonising the electricity sector by 100% (or even 2035 for developed countries). This target has been taken up by many players, including Eurelectric, investor coalitions (e.g. IIGCC) and SBTI in its new Net Zero standard published in October 2021, and has led EDF to reexamine its carbon trajectory and its 2020 commitments. This new situation carries risks for the Group: the risk of certain development projects being called into question, the risk of having to make commitments that are more difficult to keep, and the risk to the company’s profitability (by giving up profitable activities);
- new legislative or regulatory changes brought about by climate change could also have a negative impact on EDF’s business and lead to new legal or compliance risks;
- The Group may also have to deal with the emergence of new technologies or disruptive solutions that are part of the efforts to meet the transition objectives.
Such situations could make it more difficult to carry out these transformations and achieve the desired objectives. They could directly or indirectly affect the Group’s business volumes, margins, asset value, financial position, reputation and/or prospects.
d) Control actions to address transition risks
- Carbon trajectory: In 2018, the Group made a commitment to significantly reduce its carbon dioxide emissions, with a target of 30 million tonnes in 2030 instead of 51 million tonnes in 2017 (40% reduction). The EDF group also confirmed this goal in 2020 by joining the “Business Ambition for 1.5 degrees” initiative. The EDF group has made new commitments to contribute to achieve carbon neutrality by 2050, both in direct and indirect emissions (scopes 1, 2 and 3), with milestones set for 2023 and 2030. The SBTi organisation certified this approach in 2020 as going beyond the 2°C set out in the Paris Agreement. Thus, for the first time, the EDF group has set reduction targets for its indirect emissions, covering in particular the emissions associated with the sale of gas to end customers (see section 3.1.1 “Group Carbon trajectory”). These control actions will be reexamined in 2022 in light of the increased requirements to accelerate decarbonisation in the electricity sector.
- Deployment of low-carbon solutions: The Group has been particularly active in the development of renewable energy in France, electric storage and low-carbon electric mobility, which will make it possible to develop and promote the Group’s low-carbon energy solutions, particularly for the transport sector, which still emits a very high level of carbon dioxide in France and Europe.
- As a final step in the process of contributing to reach neutrality, the Group favours so-called “negative emission” projects to offset its residual emissions by 2050 (see section 3.1.1.6 “Use of negative emission solutions”)
- As a final step in the process of contributing to reach neutrality, the Group favours so-called “negative emission” projects to offset its residual emissions by 2050 (see section 3.1.1.6 “Use of negative emission solutions”)
e) Overall control actions – summaries and mapping of climate risks
- In 2019, a summary on climate change and its impacts on EDF, integrating the accumulation of all the knowledge acquired by the EDF group and its scientific partners, was presented to EDF’s Scientific Council.
- Since the 1990s, the Group has had significant expertise in climate change, both in its R&D department and in its engineering centres, and this expertise has been maintained over time. The precise resources allocated to this expertise are specified in § 3.1.2.4 “An internal climate department, unlike any other major electricity company”
- In 2019, a Group-wide climate risk mapping of all physical and transition risks was also established following the recommendations of the TCFD (Task Force on Climate-Related Financial Disclosures) and submitted to the Audit Committee. Climate risks are now identified, assessed and updated annually in accordance with the Group’s general risk mapping methodology (summarised in this risk factor and further detailed in section 3.1.3.2.2 “Indentifying climate change risks and opportunities”).
- This mapping of climate risks, based in particular on the operational entities’ adaptation plans and the report to the Scientific Council, has led since 2020 to a “climate” action plan, included in the Cap 2030 strategic programme, covering actions relating to emissions reduction and resilience. This action plan mobilises the Group both at the corporate level and at the entity level to guide and coordinate the various control actions.
- Numerous actions are carried out internally to raise awareness of climate issues among all employees and to mobilise them in concrete ways. By way of example (these examples are developed in § 3.1.3.5.2 “innovation and collective intelligence focused on climate action”), the Group has been deploying the Climate Collage to all its teams since 2020, and aims to make this deployment widespread by 2022; the “Fighting CO2” programme offers all employees in France the opportunity to become ambassadors for the energy transition by making a private commitment; and the Carbon Neutrality Passport enables employees to assess their carbon footprint and make a commitment to start taking action: obtaining this passport was one of the criteria of the profit- sharing agreement signed for 2020. Over 31,000 passports were obtained in 2021.
