Sustainability report highlights
Sustainability is at the core of Fortum’s strategy. Together with Uniper, we as Fortum Group are now the third largest producer of carbon dioxide -free electricity in Europe and a significant gas company. In our operations, we give balanced consideration to climate and resource issues, as well as our impacts on personnel and society.Sustainability report 2020
Sustainability Highlights 2020
- Uniper transaction succesfully completed and Uniper included as a subsidiary in Fortum’s reporting
- New corporate strategy released; a group-wide carbon neutrality target, in line with the goals of the Paris Agreement, by 2050 at the latest
- Coal-exit proceeding well; Uniper coal-fired power plant Heyden 4 taken out of commercial power generation at the end of 2020
- New, ambitious safety target measured as TRIF* for own personnel and contractors < 1.0 by the end of 2025 (*Total Recordable Injury Frequency)
- Annual outage at Loviisa nuclear power plant successfully completed, with nearly 1,500 workers from 10 different countries and NO Covid-19 cases
Transform our own operations to carbon neutral
In December 2020, Fortum announced a new strategy and its commitment to carbon neutrality. Fortum aims to drive the clean energy transition and focuses on reducing carbon dioxide emissions from its own operations. We have committed to the carbon neutral (Scope 1, 2, and 3 greenhouse gas, GHG, emissions) target globally, aligned with the goals of the Paris Agreement, by 2050 at the latest. In addition, we have the following ambitious mid-term targets in Europe:
- Reduction of CO2 emissions (Scope 1 and 2) in European generation by at least 50% by 2030 (compared to base-year 2019)
- Carbon neutral (Scope 1 and 2) in European generation by 2035 at the latest
In 2020, Fortum’s sustainability team faced a new challenge as we were tasked with consolidating the operations of our new subsidiary, Uniper, into the 2020 report.
Frequently asked questions
What are Fortum’s biggest sustainability challenges right now?
The entire energy sector is undergoing a transformation and Fortum is a key driver of this change.
2020 was a year of changes at Fortum, including the consolidation of Uniper and the launch of a new corporate strategy. Our key strategic priority is to transform our own power plants and operations carbon neutral. We have committed to the carbon-neutral target globally, in line with the goals of the Paris Agreement, by 2050 at the latest, and in our European generation by 2035 at the latest. By 2030, Fortum will phase-out or exit about 8 GW of coal-fired power generation.
While we proceed towards carbon neutrality, we must be able to provide our customers reliable and reasonably priced energy in the future, as well. We will also strengthen and grow in CO2-free power generation. Our target is to build 1.5-2 GW of new renewable energy capacity by 2025, primarily in Europe. In addition to climate-related targets, Fortum has set a new biodiversity target for the year 2021. We aim at conducting a minimum of 12 major voluntary measures that improve the living conditions of species and strengthen populations.
Why have Fortum’s carbon dioxide emissions increased so significantly in 2020?
Uniper was a considerably larger company than Fortum, before the consolidation. With Uniper, our power generation capacity more than tripled compared to 2019. In 2020, Fortum Group, of which Uniper is part, was the third largest producer of CO2 free electricity in Europe. As we consolidated Uniper and its generation capacity into our reporting, it is obvious that the reported emissions increased in 2020. Worth noting is also that we report the greenhouse gas emissions of our entire value chain.
In December 2020, we published carbon neutrality targets covering Fortum's operations. Our target is to be carbon neutral in European generation already in 2035 and in our operations globally in 2050 at the latest, in line with the goals of the Paris Agreement. We also have clear plan for phasing out coal-fired generation capacity. By 2030, Fortum will phase-out or exit about 8 GW of coal-fired power generation. In 2020, the share of our coal-fired power generation was 9% of total power generation globally, and the share of revenue of total revenue was 1 %.
Why natural gas is important in the transition to low-carbon energy system?
CO2 emissions of natural gas are about half of that of coal and just one-third of lignite emissions. Replacing coal with gas reduces total emissions by hundreds of millions of tons annually in Europe.
Natural gas enables increasing the amount of renewable electricity in the system, because it is very flexible and can be easily used to balance the energy system when wind doesn’t blow, or sun doesn’t shine. Over time, increasingly green hydrogen and other clean gases will replace natural gas. Fortum’s strong position in the gas business creates good prerequisites to succeed in providing green hydrogen solutions in the future.
What are Fortum’s targets and actions related to biodiversity?
Fortum has set a new biodiversity target for year 2021: at least 12 major voluntary measures enhancing biodiversity. We aim to improve biodiversity in connection with our operations, we carry out biodiversity-related projects, and we collaborate with our stakeholders in projects. We also assess the biodiversity impacts of our new projects and aim to mitigate them. In addition to the current mandatory/permit-bound biodiversity actions, Fortum engages in many voluntary habitat restoration and other projects improving biodiversity, especially in hydropower production. Examples of projects are, in addition to the Sustainability report, in our Biodiversity Action Plan.
How is diversity addressed at Fortum?
We understand that diversity and inclusion are key to our long-term success as a company in all our markets. We value diversity and foster fair treatment and equal opportunity in the recruitment, remuneration, development and advancement of employees, regardless of, e.g., ethnicity, gender, age, sexual orientation, disability, or any other factor. Discrimination or unfair treatment is not tolerated.
Fortum and Uniper are both participants in the Equal by 30 campaign, a global effort to reach gender parity in the energy sector by 2030. The initiative includes 12 governments and more than 130 participating organizations worldwide.
Fortum’s target is to comply with the principles issued in the Finnish Government Resolution on equal gender representation in the boards of listed companies with the aim of the board consisting of at least 40% of women and men each by 2020. At the end of 2020, Fortum’s Board of Directors comprised nine members, four (44%) of them were women. Uniper has set a target for women to account for 25% of its high-level executives by June 2022.
Year 2020 in short
As the world is facing not only a climate crisis but also a global biodiversity crisis, Fortum set a new biodiversity target, addressing the year 2021. Fortum aims at conducting a minimum of 12 major voluntary measures that improve the living conditions of species and strengthen populations.
Together with Uniper we grew in business, but also significantly in personnel. The safety of our personnel and contractors remains our top priority, and we set a new, ambitious safety target.