Climate work with a tight schedule
We have moved our carbon neutrality target (Scope 1, 2 and 3) forward to 2030. We will exit all coal generation and related activities already by the end of 2027. Already today, our coal-based generation is small, with the share of coal accounting for only 3% of Fortum’s revenues in 2022. We are committing to set emission reduction targets based on climate science (SBTi 1.5°C). This commitment assumes full exit from Russia. We equally support the rapid climate actions and targets called for in the IPCC’s Climate Change 2023 report.
Extending the operations of the Loviisa power plant, power upgrades from hydropower plant refurbishments and replacing fossil fuels in district heating are examples of our actions.
The decarbonisation of industrial processes is a fundamental next step towards carbon neutral societies. We can achieve this by partnering with customers, developing and building new clean power and driving the development of clean hydrogen. A case in point is our cooperation with Microsoft, in which excess heat from data centres is used to produce emission-free district heat.
Clear direction for biodiversity
Our goal is that our current and new activities (Scope 1 and 2) no longer reduce terrestrial biodiversity, i.e., have no net loss from 2030 onwards. The wide-ranging target was formed on the basis of a science-based biodiversity impact assessment in which we examined Fortum’s own activities and those of our value chain. In 2023, we will work to assess the state of biodiversity of the lands and forests owned by Fortum, to identify actions to improve biodiversity.
We will also continue our long-term biodiversity work in relation to hydropower by taking part in local projects. The aquatic impacts of hydropower cannot be comprehensively measured with the science-based model we use, so, work with external partners in 2023 to develop a method to address this need.
We will reduce harmful impacts on terrestrial biodiversity in the upstream of the value chain (Scope 3) by 50 per cent by the year 2030 (base year 2021). These impacts are created for example in the fuel supply chain. Abandoning fossil fuels will significantly reduce our overall impact on biodiversity. This reflects the tight link between climate issues and biodiversity in a concrete way.
People and communities as a part of our sustainability approach
We want to be known as a company that cares about the people and communities around us and in our supply chains. Our safety targets and our commitment to drive a just energy transition are a reflection of this.
Occupational safety continues to be our highest priority. We are running an extensive leadership training programme, built on personal insights on what each of us can do to promote a common work safety culture in a positive way, rather than just focusing on preventing accidents.
As the pandemic subsided, the war in Ukraine and the consequential exceptional situation in the energy market posed new challenges to personnel wellbeing. We paid special attention to mental wellbeing in 2022 by, for example, providing conversational support and coaching opportunities.
In March 2023, Fortum joined the Energy for a Just Transition collaboration facilitated by BSR in partnership with The B Team and aiming to bring together committed energy, utilities, and related companies and critical stakeholders to help the energy industry to better plan for and implement a just, fair, and inclusive transition.
Sustainability reporting undergoing changes
The EU’s sustainability reporting framework is very extensive and a novel way of conducting sustainability reporting in a specific format. Sustainability matters will become an even more integral part of the Board’s Operating and Financial Review and the Financial Statements process. This new framework will introduce harmonised information for investors and other stakeholders on wide range of sustainability topics. Fortum is an experienced reporter, but the reporting based on the new CSRD Directive is a demanding task – even for us – and requires changes in the present reporting process. Sustainability and financial reporting experts, as well all the other business and corporate function experts from Human Resources to Risk Management, will be collaborating more extensively at Fortum as well as in other companies.
Big task ahead
With the new strategy, we at Fortum are building the company’s path forward from a strong common starting point. We will help societies to reach carbon neutrality and our customers to grow and decarbonise their processes in a reliable and productive way, while maintaining a balance with nature. In this work, our sustainability targets and broad collaboration with clients and stakeholders are key.