Sustainability activities and results

 

Monitoring of relevant indicators and open communication of progress are integral to sustainability activities. We aim to provide detailed information on the implementation of our sustainability activities and we follow international requirements and standards in preparing public reports.

In pursuing its long-term strategy, Ignitis Group emphasises the importance of the decarbonisation of the energy sector, the modernisation of the energy system, the expansion of renewable energy, the development of innovative solutions and sustainable growth while adhering to the principles of environmental protection, social responsibility and good corporate governance.

The non-financial performance of Ignitis Group in the area of Environment, Social and Corporate Governance (ESG) has been comprehensively assessed by Sustainalytics and MSCI.

Environmental protection

One of the priorities of responsible conduct of the Group is conserving environment and energy awareness. The Group contributes to the implementation of Sustainable Development Goals in the area of environmental protection by adhering to principles set out in the Environmental Policy.

In order to reduce the negative impact to the environment, the Group concentrates effort in those areas, where the impact is the greatest while action allows for best results. Ignitis Group has committed to achieve net zero emissions by 2050. In order to implement the target, the Group is investing in wind energy, increasing electricity distribution network efficiency, energy generation from waste and biomass as well as clean transport projects. In order to ensure continuous improvement of environmental protection effectiveness, the Group companies are encouraged to implement ISO 14001 standard.

GHG emissions

Climate change is one of our greatest challenges of the century, which requires engagement from both public and private sector as well as from each individual. Even though electricity and heat are the driving force of the economy, according to International Energy Agency, energy and heat generation sector contributes the most to carbon dioxide (CO2) emissions. Thus, transformation and decarbonisation of the energy sector are vital to implement the Paris Agreement and maintain the global temperature increase below 1.5°C.

Greenhouse gas (GHG) emissions of Ignitis Group companies

  Unit 2019    2020   
Direct (Scope 1) emissions Thousand t CO2 eq. 233 767
Indirect (Scope 2) emissions (market-based) Thousand t CO2 eq. 343 427
Other indirect (Scope 3) emissions Thousand t CO2 eq. 3 083 3 899
Total Thousand t CO2 eq. 3 659 5 093

*GHG emissions provided here are lower than indicates in the 2020 annual report of Ignitis Group. The discrepancy arises because the numbers were clarified after the release of the report. According to the recommendations of the GHG auditor, wholesale energy trading was excluded from Scope 3.

Emissions from renewable energy sources:

  Unit 2019    2020   
Biogenic emissions Thousand  t CO2 eq. 59 122

Emissions calculations were audited by external auditors. You can find the relevant reports below:

2019 audit statement   2020 audit statement

Considering the importance of climate change challenges, constant reduction of GHG emissions is a strategic activity of the Group with the core purpose of reducing and reaching net zero emissions by 2050.To strengthen the implementation of this goal, the Group formed a Sustainable Development Committee, which supervises the progress of emissions reduction and other sustainability-related activities as well as provide recommendations to the Management Board of Ignitis Group.

We are working to reduce GHG in the following ways:

  • by rapidly expanding capacity of our renewable energy sources,

  • by improving energy efficiency of our infrastructure,

  • by optimising consumption of resources necessary for operating,

  • by developing solutions that help customers consume more sustainably,

  • by applying newest technologies and investing in internal and external innovations.

Other emissions

The main other emissions emitted in Group’s operations of generating electricity and heat are nitrogen oxides (NOx), carbon monoxide (CO), sulphur dioxide (SO2) and dust. The concentration of emissions is being supervised regularly and all environmental protection standards are being followed. You can find detailed information on the emissions on the websites of Group companies:

Kauno Kogeneracinė Jėgainė 
Vilniaus Kogeneracinė Jėgainė
Ignitis Gamyba

Energy consumption

Energy consumption inside the organization consists of energy used by the Group’s production facilities, buildings and offices. The greatest share of energy is used in energy production processes. The Group is expanding its green energy generation capacities and invests in increasing the efficiency of the distribution network in order to lower the energy consumption footprint. For example, ESO invests in the installment of smart meters, which let manage, analyze and optimize energy distribution and consumption better. It is estimated that by 2028 all the meters will be replaced with smart ones (about 1.6 million units).

Seeking to strengthen its actions regarding climate change and to contribute to the comprehensive reduction of GHG emissions, the Group pays special attention to the increase of the consumption efficiency. Energy efficiency means that the same result is achieved using less energy, which not only results in a smaller ecological footprint, but also helps consumers spend less.

In October 2019, the Group and the Ministry of Energy of the Republic of Lithuania signed an Agreement on Energy Consumer Education and Consultation, thereby joining the initiative to promote energy efficiency in Lithuania.Its goal is to educate and consult consumers about energy efficiency, in that way helping consumers to lower the energy consumption costs and to join in the advancement of energy efficiency.  

Distribution network operator ESO founded the Energy Efficiency Club, uniting businesses in Lithuania that declare their energy savings. During the period of 2014–2020, the Energy Efficiency Club helped ESO save 1609GW, of which 362GW were due to the contribution of the Energy Efficiency Club.

It is important to develop a responsible energy consumption point of view from an early age. That’s why the Group is involved in the promotion of energy awareness for the young generation and develops the  “Ignitis Detectives” project. The project teaches youth in playful ways about the importance of saving energy and how to achieve it. You can find out more here (only in Lithuanian).

Waste

All generated waste is sorted by separating secondary raw materials and hazardous waste. The waste is entered into the Unified Product, Packaging and Waste Record Keeping System (GPAIS) before being handed over to waste management companies. The Group concludes agreements with specialised companies for safe management and handling of the waste generated from the production operations.

The Group’s partners and contractors are subject to the same conduct of business standards.

The Group above all emphasizes the importance of reducing waste. As part of the commencement of operations at the Kaunas waste-to-energy co-generation power plant, the Group is undertaking a project to educate the public about circular economy. We seek to build awareness among our clients and the broader public about the need to reduce, reuse, recycle before throwing away materials and objects that cannot be repurposed or recycled.  More about the project can be found here (only in Lithuanian).

Water management

Water is an essential natural resource in many of the Group's activities. In its operations, the Group draws surface water, groundwater and water from supply systems. Water resources are mainly used to ensure electricity generation processes - at the Kruonis pumped storage hydroelectric power plant, Kaunas Algirdas Brazauskas hydropower plant as well as the combined cycle unit and reserve power plant at the Elektrėnai complex. Appropriate management of water risks directly affects the Group’s performance and is therefore integrated into annual planning, risk assessments and is highlighted in yearly sustainability reports.

According to the World Resources Institute, Lithuania is in a low to medium water stress zone (10-20% ratio of withdrawals to supply). Much attention is paid to surface water, groundwater monitoring and protection measures. Ignitis Gamyba was the first company to implement the requirements of LAND 2-95 regarding public access to the water levels of the water bodies managed by the company. Hourly data of the Elektrėnai pond and Kaunas hydropower plant pond water levels is available on the website of Ignitis Gamyba (only in Lithuanian).

In order to avoid contamination of soil and groundwater, the collection and disposal of oil and other waste is always ensured in places where construction, installation, operation and reconstruction of electrical equipment is planned. Oil collection tanks are installed in the areas of open switchyards and substations where oil may leak from transformers and oil circuit breakers into the ground and groundwater.

Biodiversity

Through our activities, we aim to reduce any direct and indirect negative impacts on biodiversity. We prioritize the protection of fish in hydropower production and the protection of the bird population in wind energy production and electricity distribution networks.

To reduce the impact on the landscape and increase grid resilience to climate change impacts, we are making significant progress towards undergrounding – building new underground power lines in place of old, overhead power lines. The ten-year ESO investment plan (available here in Lithuanian), includes goals such as 11 200 km of new underground lines, 67% of 10 kV underground cables in the forests, 132 km of old gas pipelines replaced from old steel pipes to new polyethylene pipelines, among others.

In order to ensure the safe and reliable supply of electricity and to protect wildlife, ESO, in coordination with the Lithuanian Environmental Protection Agency, relocates stork nests that endanger the electricity grid and human safety in accordance with the Law on Protected Animals, Plants and Fungi. To eliminate unplanned emergency failures of overhead power lines, ESO relocates stork nests to nearby bird environments - stork nests are relocated no further than 100 meters from the original location of the wild bird nest.

Green Bonds

Ignitis Group green bond issues are based on the International Capital Market Association (ICMA) Green Bond Principles as well as being monitored based on their requirements and recommendations. In July 2017, the Group issued their first EUR 300 million bond and, a year later, in July 2018, a second green bond of the same amount was issued successfully again. The Group uses the investments to finance projects in wind energy, increase electricity distribution network efficiency, energy production using biomass and non-polluting transport projects. The financing obtained using green bonds is used by the Group to finance only green energy projects. During the period of 2020-2023, we are estimating investments of EUR 700-950 million into green energy production in order to complete construction projects by 2023 and reach 1.6-1.8 MW of installed capacity.

Social affairs and environment

We are inspired and united by a common goal - to create an energy smart future that is convenient, simple and environmentally friendly. We care about the experience and personal development of our employees. We ensure the protection of human rights, the quality and safety of the workplace, equal opportunities and diversity, as provided for in the Group's Equal Opportunities and Diversity and other policies. We promote civic engagement, volunteering, maintaining relations and collaborating with local communities, business and science cooperation, and public education on energy efficiency and safe energy consumption.

Employee Diversity

A work environment that encourages diversity enriches the employees’ experience and strengthens equal opportunities for their talents to unfold. Research also indicates that in companies where employees feel valued and involved in their activities, the loyalty of the employees is greater and staff turnover is lower. Therefore, the Group’s strategic target of improving the employee experience also includes the promotion of diversity.

Put together, the Group’s companies have almost 4,000 employees. Even though work opportunities available at Ignitis Group are not in any way based on sex or other characteristic not relevant to the job functions, due to the specificity of the energy sector, there tend to be more male employees.

        General demographic data of employees in 2019
All employees

28 % women

72 % men
Specialists

35 % women

65 % men
Middle managers

31 % women

69% men
Managers

30 % women

70 % men
By age

33 % 17 – 36 years of age

48 % 37 – 56 years of age

19 % 57 – 76 years of age

 

Employee Health and Safety

We aim to create a safe work environment for our employees and partners, and that’s why we constantly revise and improve our work safety features and processes established to identify potential risks. The Group’s companies use various measures for this. For example, preparation of safe work guidelines, equipment acquisition and distribution among employees, creation of a safe work environment, mandatory work safety training, etc.

Work safety success is ensured with the help of dialogue between the employer and the employees. The Group puts a significant amount of effort to inform and educate employees on this subject, and employees are encouraged to report possible violations and risks. This way we ensure zero tolerance for work safety violations. The Group’s companies constantly collect information about accidents, inflicted damage, injuries.

 

Employee Development

It’s important to us that employees feel empowered to improve their knowledge, so we provide them with various opportunities to achieve it. The Group has established a training academy where various general, professional and managing competence training is provided. For example, there are leadership, team building, change management, project management and other types of training available. The Group takes care of qualification raising of its employees and ensures that employees have all the necessary certification for work required by law.

In 2019, each employee was subject to 8 hours of training (only live training hours counted) in the Group. In 2018, training time reached 25 hours per person (including live and online training).

In 2019, 498 employee competence and carrier advancement evaluations were carried out in the Group, education plans were devised and 83 % of employees participated in official annual performance reviews.

Human Rights and Equal Opportunity

We value every employee and seek to ensure equal opportunity when hiring and promoting, regardless of one’s age, gender, race, cultural background, religion, sexual orientation or other criteria which are not directly related to work. The Group respects and protects the rights of its employees, stands against any human rights violations and promotes equal opportunity everywhere, where it can have an impact.

Work conditions, remuneration, benefits and other organizational aspects for our employees are determined to ensure equal opportunity and to help employees manage work, personal life and take care of familial obligations.

The Group’s Code of Ethics and Equal Opportunity and Diversity Policy establish the principles of equal opportunity and diversity to be upheld in the Group, as well as the main means of their implementation. One of such means of implementation  is the Group-wide Trust Line, to which employees and other stakeholders can confidentially report any possible breach of sustainability principles, including violations of human rights and equal opportunity, which are then investigated by the Group via an established process.

Employee Satisfaction and Benefits

We seek to shape an organizational culture with dedication and direction, as well as to ensure a good employee experience. We have been conducting the Employee Net Promoter Score (eNPS) surveys since 2019. This research helps us indicate how much employees value various experiences in the organization, how satisfied they are and if they would recommend us to their friends and colleagues.

eNPS survey results indicate progressive improvement. During the second quarter of 2019, the score was 23 %, while during the second quarter of 2020, it jumped to 54 %. The constant improvement of the score is one of the Group’s strategic goals.

The employee benefit system is implemented across the entire Group. Benefits are a motivational tool to increase the involvement of employees, and to assist them in balancing work and personal obligations. Employees can use additional motivational incentives to improve their skills, performance results and enrich their experience in the company.

Financial support

The granting of support in the Group is regulated by the Ignitis Group Financial support policy. Following good practice in other countries and in the private sector, financial support to close communities is currently available only to Group companies developing renewable energy projects and maintaining such production capacity, i. y. UAB Ignitis renewables and its subsidiaries. Read more about it here.

You can find more information about the Lietuvos Energija charitable fund by clicking on this link (information available only in Lithuanian language).

Community engagement and collaboration

Community - a group of people who are united by place of residence, occupation, shared beliefs, norms and common objectives, interests or other identity. In the context of the Group's activities, we identify those communities that are affected or may be affected by the Group's activities.

We aim to minimize potential negative impacts on communities and be a trusted member of communities. When forming and improving our sustainability activities, we take into account the opinions of community members, therefore we give priority to open and active communication.

More about how we work with communities can be found here (link).

Education

Ignitis klasė is an educational program about energy and innovation

Ignitis together with the Museum of Energy and Technology organizes free educations (live and remotely) for groups of 6th-11th grade students. In Ignitis klasė lessons, students have the opportunity to get acquainted with various energy topics - energy history, electricity generation in Lithuania, renewable energy resources and developing future innovations - electric mobility, new energy production methods and future energy challenges. They also talk about energy efficiency, the causes of climate change and ways to mitigate it. The aim of this initiative is to encourage students to take an interest in energy, to get acquainted with measures to prevent pollution, and to promote energy efficiency in an efficient, conscious and sustainable way. In the 2020-2021 academic year, about 500 students and as many participants of different age groups participated in this program in a public distance learning class. In the 2021–2022 school year, it is planned to extend the lessons of the Ignitis klasė and invite even more children to get acquainted with energy.

Governance aspects

Led by an experienced management team, the Group has achieved significant results in the field of sustainable energy development while demonstrating a commitment to the highest principles of environmental protection, social responsibility and governance.

The Group operates under a transparent, efficient and robust governance model. Since 2016, the company annually ranks among the best-managed state-owned enterprises: it has been announced as the governance leader in the category of large companies and has been awarded the highest possible A+ rating according to the Governance Index.


 

Business continuity assurance

In the Group, business continuity is enshrined in the Business Continuity Policy and related documents and standards. The policy provides a framework that ensures the Group's preparedness for an unforeseen disruption. The highest level of attention is paid to safe and uninterrupted operations: the Business Continuity Policy and crisis management plans of the Group of companies are approved by the Board of AB Ignitis Group.

On the basis of the business impact analysis, business continuity plans are prepared in each of the Group's companies in coordination with the parent company. The main business continuity plans of the Group companies are Business Continuity Plan, Emergency Plan, Crisis Management Plan and Disaster Recovery Plans. The policy sets out responsibilities for the preparation, review, and periodic testing of the plans. Regular training exercises are also held in the Group companies.

Prevention of corruption

Ignitis Group strives to act responsibly and sustainably, so it does not tolerate any manifestations of corruption in its daily operations and advocates for fair and ethical business and transparent communication with all stakeholders.

You can find out more about corruption prevention activities on this page:

Prevention of corruption

Reports and indicators

You can learn about our sustainability activities and progress towards the implementation of the highest principles of environmental protection, social responsibility and good corporate governance (ESG) in our reports and sets of indicators.

Sustainability (CSR) reports ESG indicators (according to Nasdaq ESG Reporting Guide)
2020 report (integrated into the Annual Report, starts at page 89) FY 2020   1H 2020
2019 report (integrated into the Annual Report, starts at page 83)  
2018 report  
2017 report  
2016 report (in Lithuanian)  
2015 report (in Lithuanian)  

ESG ratings

Sustainalytics ESG Risk Rating  
Sustainalytics

Summary Report

The non-financial performance of Ignitis Group in the area of Environment, Social and Corporate Governance (ESG) has been comprehensively assessed by Sustainalytics, a leading independent provider of ESG and corporate governance ratings, research and analysis. It has provided the ESG Risk Rating as set forth in the ESG Risk Rating Summary Report.

ESG Risk Rating Summary Report by Sustainalytics in brief:

  • The total score of 26.5 places Ignitis Group in the top fifth best performers in both its subindustry and industry group and in the top half globally, with over 12,000 companies assessed to date.
  • Overall, Ignitis Group is at medium risk of experiencing material financial impacts from ESG factors, due to its medium exposure and strong management of material ESG issues

This external rating represents an extensive evaluation of our performance in the most material areas of sustainability and may assist investors and other stakeholders in their decision-making.

MSCI ESG Rating  
msci

 

In 2021, Ignitis Group received a rating of AA (on a scale of AAA-CCC) in the MSCI ESG Ratings assessment.

DISCLAIMER STATEMENT. The use by Ignitis Group of any MSCI ESG RESEARCH LLC or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service marks or index names herein, do not constitute a sponsorship, endorsement, recommendation, or promotion of Ignitis Group by MSCI.  MSCI services and data are the property of MSCI or its information providers, and are provided ‘as-is’ and without warranty. MSCI names and logos are trademarks or service marks of MSCI.

EcoVadis Rating


ecovadis

In April 2021 our sustainability practices in the Customers and Solutions segment were recognized with a silver medal by EcoVadis, a ratings platform that focuses on supply chain sustainability.

Our subsidiary Ignitis falls among the top 8% of all companies assessed by EcoVadis and among the top 16% of companies within the energy supply industry.

Report highlights (link)

Performance overview (link)

Rating certificate (link)

 

 

ecogain

 

In 2021, the impact and actions of our Group in the context of biodiversity conservation have been assessed by the independent Swedish organization Ecogain. In the Biodiversity Index, which measures how large companies disclose information related to biodiversity, we ranked second in the Baltic region ranking table (12 points).

Report (link)