Biodiversity and Ecosystems

Material impacts, risks, and opportunities

ESRS 2 SBM-3

The global decline in biodiversity and degradation of ecosystems constitute a major environmental challenge as evidenced by the crossing of related planetary boundaries. As a builder, owner and operator of power plants, Alpiq understands that electricity generation depends on nature as a resource and that its activities have a significant footprint on ecosystems. To minimize its footprint, mitigate impacts and offset them where necessary, Alpiq has put measures in place to create, preserve or revitalise essential habitats for animals and plants, including financial support for many environmental revitalisation and improvement programs. The company ensures the quality, reproducibility and sustainability of its processes in this regard by implementing environmental management systems such as ISO 14001 and EMAS.

Furthermore, in 2023 Alpiq conducted a materiality assessment of potential impacts using the ENCORE (Exploring Natural Capital Opportunities, Risk and Exposure) framework to identify the company’s dependencies and pressures on nature. The assessment confirms that the generation of electricity via Alpiq’s production portfolio notably has very strong interdependencies with climate regulation, water resources and use, terrestrial / freshwater ecosystems and biodiversity as well as having the potential to provide flood and storm protection.

As mentioned in the Climate Change Chapter, to elaborate on the ENCORE study, Alpiq conducted a risk assessment on biodiversity with the WWF Biodiversity Risk Filter in 2025.

Ultimately, EIAs, including impacts on biodiversity, are a key part of all Alpiq projects and play an important role in driving strategic choices.

Identification process for impacts, risks, and opportunities

ESRS 2 IRO-1

In order to identify material IROs, Alpiq conducted a DMA as described under the chapter Material Sustainability Matters.

For the assessment of biodiversity and ecosystems-related IROs, internal experts reviewed business activities in Alpiq’s own operations as well as in the upstream and downstream value chain and came up with a qualitative assessment of the (potential) impacts on biodiversity and ecosystems.

The DMA identified a positive material impact on biodiversity: by contributing to electrification, negative impacts on biodiversity and nature can be reduced in different sectors.

Furthermore, the DMA identified several negative material impacts on biodiversity. Alpiq builds, owns and operates production facilities whose locations are strongly influenced by the natural resources used. The location of these facilities, particularly those using renewable energy, leads to construction in areas occupied by natural ecosystems of significant biodiversity value. Also, building new power plants or production facilities has a negative impact on the environment, e.g. the territorial footprint of construction, resulting in soil change or loss, impacting habitats for flora and fauna. In addition, energy production and transportation facilities, as well as construction work, generate emissions, including air pollutants, noise, light and electromagnetic fields, which have various effects on fauna.

Within the WWF Biodiversity Risk Filter Tools Alpiq’s assets fall under either of the three Electric Energy Production categories: (i) Hydropower, (ii) Geothermal or Combustion (for gas-fired & nuclear power plants), or (iii) Solar, Wind.

The WWF Biodiversity Risk Filter identifies the following “Very High Risk” (Scores = 4.2–5.0) physical risk factors for Alpiq’s assets:

• Landslides
• Land, freshwater, and sea use change
• Proximity to protected or conserved areas
• Impacts on local communities

The high risk related to land and freshwater use as well as protected and conserved areas again reflects the sensitive locations where Alpiq’s power plants are typically situated. The landslide risk aligns with the findings from the Munich Re tool, confirming the expectation that Alpiq’s infrastructure may face increasing impacts from landslides driven by heavier rainfall and rising temperatures.

Finally, local communities represent a critical stakeholder group for Alpiq, as their acceptance is essential for the timely development and construction of infrastructure projects. To mitigate this risk, Alpiq actively involves local communities in project developments, as shown by the Gondosolar project, where the municipality participates with a 35 per cent capital stake in the project sponsorship. Similarly, the development of large scale projects like the Gornerli multi-purpose dam can only be accomplished by involving the various stakeholder groups. Alpiq Project and Environmental Managers maintain a close dialogue with environmental, landscape protection and tourism organisations (Environmental Support Group) as well as with representatives of the concession communes, the canton and the Swiss Federal Government (Authorities Support Group). It is crucial for all bodies, committees and authorities involved in the process to work together closely and efficiently and to exchange information on a regular basis.

In order to further evaluate Alpiq’s territorial impact, a specific biodiversity footprint indicator was developed and tested on the hydropower asset portfolio. The in-house analysis, carried out in 2025 via a Geographic Information System, establishes the direct interaction or proximity between the assets and the main biodiversity zones listed in cantonal and Federal registers. Considering the complexity of hydropower assets (water intakes, dam & reservoirs, penstock, powerhouse, etc.) this constitutes a test case enabling further analysis and possible extension to other asset types and locations.

ESRS E4-3

Alpiq manages the construction and operation of production sites proactively in order to minimise their impact and promote the existing biodiversity. This includes the collaboration with different interest groups and the implementation of remediation, renaturation and compensation measures for Alpiq’s development projects and for the watercourses on which the company operates.

Environmental expertise is also developed internally to improve the overall environmental quality of projects. An environmental assessment, including nature and biodiversity, is a key part of all Alpiq projects and plays an important role in driving the company’s strategic choices, even at an early stage.

For hydropower plants, the impacts of water withdrawals vary from case to case. In the case of Switzerland, the impact on watercourses has been assessed in accordance with the Federal Water Protection Act. For all the facilities managed by Alpiq, remediation measures are identified and implemented. The remediation measures include the construction of specific measures to allow fish migration (fish ladder, bypass channel), sediment evacuation and management, residual flow management and re-naturalisation. Finding a good balance between energy production and nature protection is a complex process, managed in close collaboration with all stakeholders.

In addition, Alpiq has been involved in the following initiatives to promote biodiversity:

• The Ruppoldingen hydropower plant has produced environmentally beneficial renewable energy on the Aare since 2000 and has held the naturemade star quality seal since 2010, the highest certification for particularly eco-friendly electricity from 100% renewable sources. As part of this certification, 0.7 centimes per kilowatt-hour sold are allocated to the Alpiq Green Fund, which has financed environmental enhancement measures totaling CHF 7.8 million to date.
• The implementation of various projects to develop sustainable tourism in the region of the “Vallée du Trient” nature park, where Alpiq operates various hydropower plants.
• Cooperation with Swiss universities and universities of applied sciences to ensure a science-based approach that takes political and social aspects into account and supports effective measures over the long term.
• Engagement with the public to promote the preservation of delicate ecosystems. The aim is to foster a harmonious interplay between human activities and ecosystems and ensure the sustainability of environmental compensation measures.

To give some concrete examples, in April 2025 Alpiq Hydro Aare created a new fish ladder at its run-of-river power plant in Flumenthal at the River Aare in the canton of Solothurn. The near-natural facility complies with state-of-the-art environmental standards as it enables fish to swim safely around the power plant and creates new biotopes. At peak times, around 20,000 fish per day are likely to use the fish pass.

Another initiative involved Alpiq’s Donation Ambassador Committee (DAC) in the Czech Republic, which supports projects in the areas of education, nature, and social responsibility. One of its recurring activities is the maintenance and restoration of a valuable wetland ecosystem near Onomyšl. Alpiq employees contribute to various efforts, such as recreating small ponds to improve water retention. These measures are showing positive effects, with previously disappeared amphibian and insect species returning to the habitat.

Finally, Nant de Drance SA is implementing 14 environmental compensation measures in connection with the construction of its pumped storage power plant. These include ecological restoration and flood protection on part of the Trient watercourse at Vernayaz. The first phase of the work – enlarging the Trient – is a key step in the flood control program. Following the flooding in the canton of Valais in November 2023, which was caused by a rise in the levels of several watercourses including the Trient, the municipalities of Vernayaz and Martigny are welcoming this project. It aligns with their commitment to address flood protection for the local population as an urgent priority.