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A word from the CEO

“In 2020 we set ambitious goals for our scope 1 and 2 emissions to reach net zero by 2050. A roadmap to achieve this target will be one of our key focus areas for 2021.”

Dear Stakeholders,

Our business was resilient to the 2020 crisis

I’m incredibly proud of our company’s achievements over the most challenging year in recent history. The COVID-19 pandemic had limited impact on our operations and our ability to deliver clean energy to our customers. With our acquisition of SN Power, a major hydro-power player, we now have 3.3 GW in operation. And despite challenging circumstances, we grew our project pipeline from 5.2 GW to 9.8 GW.

In 2020, we stated our ambition to become a major global player in solar, hydro, wind and storage solutions, and an integrator of high-value infrastructures. We completed our first solar hybrid plants for two United Nations organisa­tions in South Sudan. We started commercial operation of the 54 MW Boguslav project in Ukraine, the 47 MW Redsol project in Malaysia, and completed the 258 MW Upington solar power complex in South Africa. The scope of our operations has grown, and so has the range of environmental, social and governance (ESG) topics significant to us, and the complexity of our efforts. With this comes responsibility, and rightful demand for trans­parent and open reporting on our progress and results.

The renewable energy market is growing

The renewable energy market has shown a remarkable resilience to the global crisis. In contrast to all other fuels, renewable energy grew by almost 7% 1) in 2020, according to the IEA. At the same time, ESG investments have sky­rocketed, displaying an immense faith in the capability of green and sustainable technology to contribute to reducing the effects of climate change. Our ESG performance is a competitive advantage in this growing market. Our business is essential to tackling climate change and our ESG performance and reporting are strong. This attracts new projects and desirable business partners, reduces business risk, and provides a better chance of project success.

ESG capability and finance are increasingly connected

Investment in ESG-aligned companies increased dramat­ically over the year. A key milestone was the launch of the EU Taxonomy for Sustainable Activities. Although some of the details of the Taxonomy are still unclear, there is no doubt that strong ESG performance and transparent reporting will be essential to access new sources of funding in renewable energy. Our ESG capability puts us in a strong position to take advantage of this. In 2020 we also refinanced one of our credit facilities at attractive terms, including a new USD 180 million ESG-linked facility, reflecting how sustainability and finance is becoming even more intertwined.

We work hard to manage ESG risks in our operations

Over the year, we collaborated more closely with our suppliers to better understand the ESG risks across our supply chain. We rolled out human rights training for all employees and provided tailored training for our most exposed staff. Although we made good progress, we do not underestimate the scale of the challenges we sometimes face in complex and high-risk markets. We continually work to improve our processes with a strong focus on cross functional collaborations and regular lessons learned.

With operations embedded in local communities, we are strongly committed to making a positive impact even during challenging times. We felt a keen sense of responsibility during the pandemic to maintain a strong, local and safe presence in our communities. We launched relief efforts including sanitation and medical supplies as well as educational consultations across all eleven countries where we have operations. We believe we further strengthened our local relations in these communities during the year. We had an exceptionally good year from an HSSE perspective with no serious injuries and improvements across all our key performance indicators. This strong result reflects our focus on safety and raising awareness of health and safety matters in all our projects.

We share the sense of urgency about climate change

We focus on the total footprint of our company’s activities. In 2020, we set ambitious goals in line with the Science Based Target Initiative to reduce our scope 1 and 2 emissions by more than 50% by 2030 and to reach net zero by 2050. Total GHG emissions from our business activities in 2020 amounted to 7,359 tons including scope 1 and 2, and air travel in scope 3. We also expanded our reporting on scope 3 emissions with estimates for our largest sources of indirect emissions in our value chain.

We are proud that our solar plants avoided approximately 1.6 million tons of GHG emissions in 2020. And now that we have entered the hydro-power segment, we will work to update our climate strategy and targets to reflect this. The Carbon Disclosure Project recognised our efforts in 2020 by awarding us a place on its prestigious ‘A’ List for tackling climate change.

I am beyond proud of the Scatec team’s achievements in an otherwise challenging year. Our vision is to improve our future, and I am confident that we have contributed significantly towards this in 2020. Being a sustainable business is a responsibility we take seriously. Our goal is to continue to grow responsibly and sustain our strong position in ESG. Despite all the uncertainties, I am truly optimistic about the future and look forward to going to work every day to improve it.

Raymond Carlsen,