Environmental dimension

Reducing our climate impact by reducing emissions

Why is this important?

As part of the Paris Climate Agreement, the international community agreed to completely eliminate the use of fossil fuels in power production by 2050. The final declaration of the World Climate Conference in Glasgow (COP26) in November 2021 increased the pressure on industrialized countries to take and implement tough measures to protect the climate. In addition, the declaration cemented the phase-out of coal-fired power production.

Alpiq’s purpose is twofold: to ‘contribute to a better climate and an improved security of supply’. In line with the first part of our purpose, we are contributing to achieving the goal set out in the Paris Climate Agreement of fossil-free power production by 2050. At the same time, however, Alpiq’s main activity in improving the security of supply is electricity production, which comes with direct and indirect greenhouse gas emissions. This is especially true for Alpiq’s highly efficient gas-fired power plants, all five of which serve the balancing needs of the local grid operators that stem from the volatile production from wind and solar plants. For the time being, in the absence of sufficient alternatives, flexible gas-fired power plants are necessary for the integration of even more renewable energy from sun and wind. However, greenhouse gases are the main factor contributing to climate change, which is potentially endangering human society and nature.

This creates something of a dilemma. If our purpose were solely to contribute to climate protection, i.e. by avoiding any greenhouse gas emissions altogether, we could simply sell those assets which produce such emissions. However, this would not still the need for the supply of balancing energy. The plant would still be needed, only the ownership would change.

The reporting year 2022 is a case in point. It was an extraordinary year on the energy market, with lower production capacities (for example, due to a lack of nuclear availability in France or the stopping of operations in Germany) as well as very high energy demand after the end of the corona lockdown. To feed this demand and the balancing needs of the variable electricity generation from wind and solar, our gas-fired combined cycle power plants (CCGT) contributed strongly to the security of supply in 2022 with a high production volume. This resulted in a proportionate increase in total emissions. In terms of intensity, however, our CCGT emissions are gradually decreasing thanks to successive improvements and refurbishments of the different power plants and due to their higher load factors. Because of our continuous commitment to run our plants with highest efficiency and lowest emissions we believe that we are the best owner until they can be replaced with CO2-emissions free technology.

It is also worth noting that, on an Alpiq Group level, our renewable and nuclear assets include significantly lower greenhouse gas intensity. The global intensity of our emissions is therefore largely driven by the CCGT emissions.

What are we doing?

As an energy producer, Alpiq is aware of its greenhouse gas emissions and its responsibilities regarding climate change. Every production technology comes with its advantages and disadvantages and Alpiq owns a major share of renewable and low greenhouse gas emission production plants, which have a significantly lower impact on climate than thermal power plants. At Alpiq, we are continuously analyzing new solutions and technologies to contribute to achieving the goal of fossil-free power production.

This is why Alpiq over many years has developed an environmentally sound power production portfolio, including a significant part of low CO2 and climate-friendly power production, and intends to keep on this line for the years to come. Environmental protection and air pollution control play a crucial role in the construction of our power plants. Alpiq is taking effective measures to reduce emissions in the new power plants projects as well as in existing power plants.

Alpiq is aware that flexibility is becoming ever more important as the market penetration of power production from new renewable energies continues to improve. As a result, the focus is also put on storage power plants such as pumped storage hydro power as well as efficient and extremely flexible gas-fired combined-cycle power plants, which are required to maintain security of supply wherever there is a lack of hydro power potential, which is currently the case in most European countries. Alpiq operates these kinds of power plants and the associated emissions are duly reported.

How do we track the effectiveness of our approach?

Alpiq is applying a management approach to its development projects as well as its existing production site in which environmental topics and in particular greenhouse gas and air pollutants emissions are an important factor in any strategic decision. Certified management systems are deployed in accordance with each specific production technology and country regulations framework.

ISO 14001 framework, which focuses on environmental management system, is applied in all Alpiq gas-fired combined-cycle power plants - in some cases in accordance with the Eco-Management and Audit Scheme (EMAS environmental management system) - as well as in the Swiss hydropower business unit which has had an integrated management system for years (ISO 9001 - quality management - and ISO 55001 - asset management) and obtained official ISO 14001 certification in 2022.

Both ISO 14001 and EMAS are focused on monitoring environmental indicators to assess the ecological performance and on conducting audits to check the conformity and improvement of ecological processes. Both programmes strive to continuously reduce pollution.

Alpiq’s activities and performance are monitored through various key performance indicators. The greenhouse gas and nitrogen oxides emissions induced by our activities have been tracked since 2020. An additional set of environmental KPIs is being gradually deployed in order to focus on environmental performance monitoring.

For a detailed breakdown of Alpiq’s emissions across Scopes 1 (direct greenhouse gas emissions), 2 (energy indirect greenhouse gas emissions) and 3 (other indirect greenhouse gas emissions) in accordance with the Global Reporting Initiatives 305-1, 305-2 and 305-3, please refer to section 8.2 of this report under General Disclosures.

Milestones in 2022 

- With 98.6% of the total share of GHG emissions declared in 2022, electricity production from gas-fired combined-cycle power plants is the main source of CO2 emissions. 2022 emissions show a significant increase, due directly to the significant increase in CCGT production. The restart of production of Plana del Vent CCGT, Spain and the high demand and extreme volatility during this particular year explains this increase in terms of total value. However, in terms of intensity, the CCGT GHG emissions are still decreasing (see “GRI 305-4”). 

- Scope 2 and Scope 3 emissions remains relatively constant and are mainly caused by energy procurement of power plants, representing approximately 1.4% of the total emissions. Mobility and office emissions remains fairly low, even with the addition of the business travel emissions. Scope 3 emissions were not yet fully recognized in the reporting year. Alpiq has set itself the goal of publishing a comprehensive balance sheet including all relevant Scope 3 emissions for the year 2023.

- The 2022 emissions relative to all business flights and train journeys are compensated through third-party project funding. 

- As mentioned at the start of this section, 2022 was an extraordinary one on European level and gas power plants (CCGT) were needed to improve the security of supply in 2022. This led to a proportionate increase in total emissions. However, these CCGT emissions are decreasing gradually in terms of intensity thanks to Alpiq’s efforts to successively improve and refurbish the different power plants and due to their higher load factors. 

- On a Alpiq Group level, our renewable and nuclear assets include significantly lower greenhouse gas intensity. The higher share of CCGT production induces a 24 g CO2e / kWh raise compared to 2021. The global intensity is therefore mainly driven by the CCGT emissions. 

- In terms of intensity, 2022 shows a significant decrease in nitrogen oxide emissions due to globally higher load factors, which increase the treatment efficiency of nitrogen oxide emissions, and the restart of production of refurbished Plana del Vent CCGT. 

- At the nuclear power plants in which Alpiq holds shares, there were no radiation doses to environment above the legal limits in 2021 and 2022. Further information on radiation doses can be found in the ENSI Radiation Protection Report 2021 (ENSI-AN-11280) and 2022, to be published mid-2023.

Numbers

- 5.32 – drop in GHG emission intensity from CCGTs against 2021 (%) 

- 2.058 – gross direct greenhouse gas emissions (million tonnes) 

- 2050 – year in which use of fossil fuels will be eliminated internationally

Frameworks/guidelines

- Paris Climate Agreement 

- ISO14001, ISO 9001, ISO 55001 

- Eco-Management and Audit Scheme (EMAS) 

- Greenhouse Gas Protocol

GRIs 

- GRI 305-1: Direct greenhouse gas emissions 

- GRI 305-2: Energy indirect greenhouse gas emissions 

- GRI 305-3: Other indirect greenhouse gas emissions 

- GRI 305-4: Greenhouse gas emissions intensity  

- GRI 305-7: Nitrogen oxides

Sustainable Development Goals

- SDG 7 

- SDG 9 

- SDG 13

Pursuing zero-emissions mobility using hydrogen

Hydrogen is an optimal alternative to fossil fuels as an energy carrier that can be generated and used without generating CO2 emissions. Provided the production process is carried out using carbon-neutral, renewable electricity, it contributes to the decarbonisation of road transport and heavy industry.

As the leading source of renewable energy, hydropower is well suited for hydrogen production. Thanks to their long operating hours, run-of-river power plants enable hydrogen production plants to run with a high degree of utilisation. An optimal balance between hydrogen and electricity generation is key to ensuring that production is economical and that sufficient electricity is available in the grid during critical periods.

In future, hydrogen production will also play a decisive role for other renewable energy sources, such as wind and solar power. Since hydrogen production can take up excess energy, it reduces the need for electricity grid expansions and contributes to the integration of new renewable energies into the system.

The advantage of the generated hydrogen is that it is transportable and can thus also be processed into methane or liquid fuels and combustibles regardless of location. Or it can be converted back into electricity and thus complement other storage solutions, such as stationary batteries. However, the associated technologies are not yet ready for the market, or they have a comparably low degree of efficiency.

Alpiq and the production of hydrogen

With hydropower in our DNA, Alpiq has the best prerequisites for the carbon-neutral production of this alternative energy carrier. Our focus is on the use of hydrogen for road transport. With our commitment to hydrogen mobility, we are already making a decisive contribution to the evolution of mobility.

In cooperation with H2 Energy and Linde Gas, we also intend to establish hydrogen as an alternative energy carrier, focusing on heavy goods transport. For this purpose, we hold a 45% stake in Hydrospider AG. In a cost-efficient manner, the company guarantees hydrogen that fulfils the quality standards of the Society of Automotive Engineers. Hydrospider has completed a 2 MW electrolysis plant at the Gösgen run-of-river power station. This is the first plant of this size in Switzerland to produce hydrogen for commercial operation.

In cooperation with EW Höfe and SOCAR Energy Switzerland, we also plan to build an electrolysis plant with a capacity of up to 10 MW in Freienbach, Switzerland. When completed, the plant will produce an annual output of around 1,000 to 1,200 tonnes of green hydrogen to enable zero-emission mobility. In addition, the exhaust heat will be fed into the regional district heating network that is currently being established. The plant will thus set new standards in terms of overall efficiency and make an important contribution to Switzerland’s climate-friendly energy supply.

Possible fields of application for hydrogen

In the transport sector, hydrogen is an alternative to fossil fuels. It can be used to power rockets and airplanes or in fuel cells for cars, trucks or ships that use electric propulsion. Its advantages are its operating range and the fast conventional fuelling process as well as its low resource consumption and weight compared to a battery.

In the industrial sector, hydrogen is applied in various fields: from the long-term storage of large quantities of energy and for emergency power supplies to the synthesis of other energy carriers and fuels and in the refining processes of the chemical industry.