EPH establishes Green Finance Framework to connect future financing with execution of its transition strategy

7. 5. 2024

Energetický a průmyslový holding, a.s. (“EPH”) has established its inaugural Green Finance Framework allowing the company to issue green finance instruments which may include bonds, loans, Schuldschein instruments, and other forms of green debt. EPH solicited a Second Party Opinion on its framework from S&P Global, which assigned a ‘Light Green’ shading to the framework, and Sustainable Fitch, which assigned a score of ‘Good’ to the framework. Both Second Party Opinion providers consider the framework to be aligned with the ICMA Green Bond Principles, among other standards.

At the same time, EPH announces new emission reduction targets. To give its stakeholders a clearer understanding of its goals, EPH decided to align its emission reduction targets with established science-based methodologies. Over the next decade, EPH’s objective is to decrease the CO2 emission intensity of its European power generation fleet in accordance with the ‘Below 2 Degrees’ pathway as outlined by the ‘Transition Pathway Initiative’. These emission intensity reduction efforts mainly involve accelerated phase-out of coal, reducing the full load hours of gas power plants, while gradually transitioning them to green gases.

In the long-term, EPH aims to achieve net zero operations by 2050. EPH has clearly defined vision for all assets in a zero-carbon energy system and its future Capex spending will be centered on adaptation of its asset portfolio for a decarbonized future.

The eligibility criteria for the assets to be financed through green finance instruments closely follow the substantial contribution criteria of the EU Taxonomy, ensuring that proceeds are allocated to assets needed to meet the EU decarbonization objectives. Key assets identified as eligible for green financing are represented by the hydrogen-aligned sections of the gas grid, power distribution grid, district heating systems, and hydrogen-ready gas cogeneration plants and power plants.

“After establishing a comprehensive transition plan and decarbonization targets, EPH recognized the importance of enhancing the transparency and accountability towards investors and banks by providing a connection between proceeds and EPH decarbonization strategy. EPH will continue to direct investments into projects with a strongly positive decarbonization impact. We believe this step will be helpful for all stakeholders to better understand our ESG ambitions and will contribute to diversification of our investor base,” says Gary Mazzotti, board member and ESG Officer of both EPH sub-holdings EP Power Europe, a.s. and EP Infrastructure, a.s.

The Green Finance Framework can be accessed here 

The Second Party Opinion from S&P Global can be accessed here

The Second Party Opinion from Sustainable Fitch can be accessed here

 

 

Disclaimer
No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of this communication or the opinions contained therein.
This communication contains certain forward-looking statements with respect to EPH’s business. These forward-looking statements may be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “plans”, “projects”, “anticipates”, “expects”, “intends”, “targets”, “may”, “aims”, “likely”, “would”, “could”, “can have”, “will” or “should” or, in each case, their negative or other variations or comparable terminology. Forward-looking statements may and often do differ materially from actual results. EPH’s business is subject to a number of risks and uncertainties that could also cause a forward-looking statement, estimate or prediction to differ materially from those expressed or implied by the forward- looking statements contained in this communication. The information, opinions and forward-looking statements contained in this communication speak only as of its date and are subject to change without notice. EPH expressly disclaims any obligation or undertaking to disseminate any updates or revisions to this communication, and will not publicly release any revisions it may make to the information contained herein that may consist of or result from any change in EPH’s expectations, revised targets or other objectives, any change in events, conditions or circumstances on which these forward-looking statements are based, or other events or circumstances arising after the date of this communication. As a result, undue influence should not be placed on any forward-looking statement.
No representation is made as to the suitability of any green finance instrument to fulfil environmental and sustainability criteria required by prospective investors. Each potential purchaser of green finance instruments should determine for itself the relevance of the information contained or referred to in the Green Finance Framework or the relevant documentation for such green finance instruments regarding the use of proceeds and its purchase of green finance instruments should be based upon such investigation as it deems necessary.