Sustainable Development Report 2021

38 39 Sustainable Development Report 2021 MYTILINEOS Environment Society Governance Sustainability Standards & Assurance Tackling Climate Change [SASB EM-CM-110a.2] [SASB EM-MM-110a.2] [SASB IF-EU-110a.3] Introduction In August 2021, the Intergovernmental Panel on Climate Change (IPCC), in its Sixth Climate Change Assessment Report (AR6 WGI - The Physical Science Basis), stressed that the climate system is facing changes at an unprecedented scale. According to the IPCC, climate change is already affecting many extreme weather and climate conditions around the world with rising tempera- tures expected to exceed 2°C unless greenhouse gas emis- sions are significantly reduced, achieving net zero carbon foot- print and significant reductions in emissions of other greenhouse gases. According to the IPCC, between 3.3 and 3.6 billion people live in areas particularly vulnerable to climate change. The European Commission, in the framework of the implementa- tion of the European Green Deal, and the achievement of the greenhouse gas emissions reduction target of at least 55% by 2030, adopted in July 2021 a relevant package of proposals. The Commission emphasizes that it is crucial that the transition to a greener economy is done in a fair way, which was also high- lighted at the United Nations Conference on Climate Change in November 2021 (CoP 26). At CoP 26, the Just Transition Decla- ration was signed by more than 30 countries worldwide, includ- ing Greece. Through this Declaration, countries are committed to securing the support of employees, businesses and communi- ties in the transition to a greener economy. MYTILINEOS, as a modern Company, recognized the need to move to a more sustainable business model early on. At the end of 2020, the Company made the strategic decision of the energy transition as this approach was considered correct, both econom- ically, socially and environmentally. This decision was based on: • the desire of the Company to contribute, to the extent possible, to tackling climate change, as one of the greatest challenges facing humanity in the 21 st century, which requires the partici- pation of all in the transition to a net zero economy based on renewable energy sources, and • to the realization, after conducting the relevant analysis and identifying the different needs arising from its expanded activi- ties, that in order to remain resilient and competitive in the cur- rent challenges, the Company must integrate sustainability in the core of its activity, developing ambitious goals reducing CO2 emissions and achieving a net zero carbon footprint, sep- arately for each Busi-ness Unit. The new vision of the Company was outlined by the Chairman and CEO of MYTILINEOS, Evangelos Mytilineos, at the beginning of the "ESG Summit Net Zero Action" organized by the Company in February 2021: “Today, the need for urgent action to tackle climate change, is driving us at MYTILINEOS to take a big step towards this direc- tion, wishing to contribute to the drastic response to the phe- nomenon. The time has come to set the ground for a 100% sustainable and green industrial activity, and we are com- mitted to achieve 30% reduction in emissions across our entire business activity by 2030 and net zero emissions by 2050. Our ambitious climate targets are embedded in our corpo- rate DNA, and have become a strategic pillar, a decision-making criterion, and a driver to every business operation. Moving for- ward, sustainable growth is and should be a priority for all. Only by aiming high and setting bold targets, all industries - including us - can ensure the creation of long-term value for all and a col- lective sustainable future for generations to come.” 1. IPCC 2021, IPCC Sixth Assessment Report MYTILINEOS Climate Targets Progress against each individual target per Business Unit Overall target 2030* -30% reduction on total CO2e (Scope 1 & 2) emissions Business Uni Targets Climate scenario Core initiatives Metallurgy Total emissions kt CO2e (Scope 1 & 2) -65% Well below 2°C • Electrification exclusively from renewable sources • Use of low carbon fuels • Application of state-of-the-art technologies and digitization • Increased production of secondary aluminum and increased use of scrap in the production of primary aluminum Relative emissions t CO2e/t Al -75% Power & Gas Relative emissions kg CO2e/MWh ~50% • Production of 7,600GWh from RES Renewables & Storage Development Net zero carbon footprint • Use of electric power from RES • Use of electric vehicles • Replacement of gas-based office space heating installations with electric heat pumps • Use of batteries for energy storage at work sites Sustainable Engineering Solutions Overall target 2050 Net zero * compared to 2019 levels In 2021, MYTILINEOS started the implementation of specialized action plans for each key initiative that contributes to achieving the ambitious goals of reducing its carbon footprint. In total, 11 key initiatives and 50 sub-actions in all Business Units focus on the utilization of existing technology as well as on inno- vation and the development of pioneering solutions, tak- ing into account the specific characteristics of each Busi- ness Unit and the current situation in the energy system. More specifically: the implementation of strategic collaborations in the field of RES, best practices, pilot programs and actions, spe- cific technical actions applicable mainly to production activities, the optimization of existing processes and technological devel- opments, participation in European programs, monitoring of new technologies for future application, are indicative categories of actions that began to be implemented in 2021. The graph shows the progress against the main MYTILINEOS tar- get to reduce total CO2 emissions (Scope 1 & 2) by -30% in 2030 compared to the base year 2019. The Company has already recorded a decrease of almost 12.4% in 2021 through increas- ing its use of energy from renewable sources. However, due to the official start of the operation of the new natural gas fueled power plant, in mid-2022, the Company estimates that its CO2 emissions will peak at the end of 2023, as 1.5 year of full opera- tion of the new plant will have already passed. From this point onwards, the gradual reduction of CO2 emissions is expected to begin as a large part of the individual actions of the key decar- bonization initiatives in all Business Units will be at an advanced stage of implementation. The progress against the individual targets per Business Unit is outlined below. The reduction of the total CO2 emissions is mainly due to the reduction of Scope 2 emissions due to the optimiza- tion of the energy mix, through the gradual de-lignification and use of more energy from renewable sources. Total Scope 1 & 2 CO2 emissions (kt CO2 eq) 2019 2021 2030 2050 2020 0 1,000 2,000 3,000 4,000 5,000 4,639 -3.9% -12.4% -30% Base year Target 4,459 4,064 Net zero Business Unit Target categories Base year 2019 Status 2021 Target year 2030 %difference compared to the base year Metallurgy Total emissions kt CO2e (Scope 1 & 2) 3,056 1,070 -65% Relative emissions (t CO2e/t Al) 13.7 3.43 -75% Power & Gas Relative emissions (kg CO2e/MWh) 329 165 ~50% Renewables & Storage Development Total emissions kt CO2e (Scope 1 & 2) 7.64 Net Zero Sustainable Engineering Solutions 6.0 (-21.3%) 322 (-2.1%) 11.2 (-18.2%) 2,620 (-14.3%)