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.

Environmental protection

One of the priorities of the Group’s responsible conduct is environmental protection and energy awareness. The Group contributes to the implementation of the Sustainable Development Goals directly related to the environment in accordance with the principles established in its Environmental Protection Policy.

In order to reduce the negative impact on the environment most effectively, the Group concentrates on the areas where its impact is greatest and where its actions can deliver the best results.

Ignitis Group has committed to reduce its net carbon dioxide (CO2) emissions to zero by 2050. To achieve this goal, the Group is actively investing in wind energy, increasing the efficiency of the electricity distribution network, energy generation from waste and biomass as well as clean transportation. In order to ensure a continuous improvement of the Group’s environmental protection measures, the Group’s companies are encouraged to implement the ISO 14001 environmental management standard.

Greenhouse Gas (GHG) Emissions

Climate change is one of humanity’s greatest challenges in this century. It requires the involvement of public and private sector as well as of every individual. Even though energy from electricity and heat power up the economy, according to the International Energy Agency, electricity and heat producers contribute the greatest share of carbon dioxide (CO2) emissions. That’s why the transformation and decarbonization of the energy sector is vital in order to be able to stay in line with the Paris Agreement and to limit the average Earth temperature rise to 1.5 °C degrees.

Considering the importance of challenges arising from climate change, continuous lowering of greenhouse gas emissions is the Group’s strategic target, with the main objective of reducing carbon emissions to zero by 2050. The Group has established a Sustainable Development Committee, which oversees the reduction of emissions and the progress of other sustainability goals, as well as providing recommendations to the Group’s management board to support this objective.

We are pursuing our CO2 reduction goals in these main ways:

  • Rapid development of generation capacities reliant on renewable energy sources
  • Improvement of energy efficiency of the infrastructure
  • Optimization of resource management
  • Development of solutions to help customers consume more sustainably
  • Application of the latest technologies and investment in internal and external innovations

Amongst all Group’s operations, GHG emissions are greatest in thermal power plants that are a part of EU Emissions Trading System. GHG emissions from combustion plants were measured in accordance to Lithuanian legislation and the results were audited by independent evaluators. The Group aims to announce a precise assessment of its total GHG emissions in accordance with the GHG Protocol and prepare a thorough emissions reduction strategy based on science-based targets (Read more here).

Table: GHG emissions and intensity 2016 2017 2018 2019
GHG emissions in combustion power plants (Elektrėnai Complex), t CO2 eq* 200,670 65,369 36,301 19,012
Total generated energy, MWh** 1,688,955 1,438,707 1,164,419 1,185,077
Total CO2 intensity (g CO2 eq/kWh) 119 45 31 16
Energy generated in combustion power plants (Elektrėnai Complex), MWh 691,881 305,123 221,178 152,026
Total CO2 intensity only in combustion power plants (Elektrėnai Complex) (g CO2 eq/kWh) 290 214 164 125

*Only generation-based emissions (includes only Elektrėnai Complex with its electricity and heat generation capacities), assuming that renewables energy emissions equal zero.

**Electricity and heat generation (does not equal delivery) in all power plants of the Group, including wind, hydro.

Data provided reflects last several years and shows big decrease due to decreased use of natural gas for electricity production in Elektrėnai Complex. Looking at 2020 and beyond, we see that the intensity may rise due to greater generation at the Elektrėnai Complex and the start of operations at the waste-to-energy power plants.

Table: GHG emissions Unit 2018*** 2019
Scope 1 t CO2 eq 42,083 24,602*
Scope 2 (location-based) t CO2 eq 107,685 116,701
Scope 2 (market-based) t CO2 eq 303,391 330,308
Scope 3 t CO2 eq 35,258 52,536**
Biomass t CO2 eq 62,136 51,675

*Scope 1 reduction due to decreased use of natural gas for electricity production.

**Scope 3 increase is in large part due to increased water use.

*** Preliminary calcalations

Some of the data provided above is based on best-available estimations and does not at this point include indirect emissions from the power distribution network. 

Transmission losses play a major role in the carbon intensity of the electricity distribution networks. The rate of technological losses of distribution at Ignitis Group rests at around 6% and is comparable to the industry average.

Other Emissions

Regarding other emissions, the Group’s activities of producing electricity and thermal energy emit mainly nitrogen oxide (NOx), carbon monoxide (CO), sulfur dioxide (SO2) and dust. The concentration of the emissions is monitored regularly, and all environmental protection regulations are strictly followed.

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.

            Incidents and accident statistics
  2019 2018 2017
Number of employee fatalities 0 1 0
Number of contractor fatalities 0 0 1
Lost time injury rate (per million hours worked) 5.79 4.47 9.78
Total number of employees during reporting period 3742 3826 4513

Lost-time injury is any incident at work which resulted in lost time at work. Generally, lost-time injury is calculated by the number of incidents per million hours of work and is called the lost time injury rate or LTIR.

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

In order to increase transparency in the Group’s companies, as of 2018 Ignitis Group and its subsidiaries do not provide financial support.

Lietuvos Energija charitable fund, through which financial assistance was previously disbursed, is being liquidated. New calls for proposals are no longer published and the proposals are not considered.

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

Our activities are geographically dispersed throughout the different regions of Lithuania and other countries where various communities are located. These communities may affect the Group's operations and, vice versa, the Group may have an impact on the communities’ residential, social and economic environment. Therefore, we believe that it is mutually beneficial to consider the needs of the respective communities, to develop joint projects, to establish partnerships in order to strengthen the sustainable development of both the communities and the Group.

We aim to minimize potential negative impacts on communities and to be a trusted member of communities. The opinion of the communities where we operate is important to us in shaping and improving our sustainability activities, and therefore we seek above all to foster open and pro-active communication, especially in the following areas:

  • Within the context of existing and planned Group activities that may have or are having a significant impact on communities. For example, when unpleasant odours are released or the sound and / or visual environment of the communities is significantly altered as a result of existing Group facilities or temporary construction work being carried out by the Group, its partners or contractors;
  • Whilst carrying out educational activities related to the specifics of the Group's operations, especially in the field of energy efficiency;
  • When developing solutions that improve the socio-economic environment of communities and contribute to the preservation of their natural environment;
  • Being a trusted employer in all Lithuanian and foreign regions where we operate.

Examples of ongoing activities:

  • Utilizing the media - television, radio, press and the internet - to inform the public about the safety principles that must be observed when working in the field. Particular attention is devoted to reminding residents about the underground electricity and gas network, as well as to the dissemination of advice on safe behaviour during storms.
  • We contribute to strengthening the education of the public and especially the younger generation about energy by organizing public tours of the objects managed by Ignitis Gamyba: combined cycle unit (CCU) in Elektrėnai, Kruonis PSHP, Kaunas HPP. Although tours were temporarily suspended during the pandemic, during 2019 more than 100 tours were organized, which were attended by more than 1,700 visitors from various companies, schools and other institutions.
  • Active participation in Lithuania’s Energy Day initiatives: in 2019, our employees taught more than fifty lessons on energy and energy efficiency to students of all ages.
  • Maintaining close contact with local communities is especially important for the Group’s companies implementing new large-scale projects - Ignitis Renewables, Vilnius CHP and Kaunas CHP. The companies periodically organise meetings, participate in community celebrations, where they present their activities, the status of project implementation, and engage in a dialogue.
  • Innovation and development projects create value for residents and communities by making their lives easier, creating opportunities to generate energy themselves and to use more environmentally friendly means of transport. For example, the Group has developed the world's first nationwide remote solar power platform, Saulės Parkai (Solar Parks), where any resident of the country, even when residing in an apartment, can become the owner of a part of the solar power plant and use the energy produced in it. In Lithuania’s capital Vilnius, Ignitis Group has developed a wide network of fast electric car charging stations Ignitis ON.

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

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 the corporate responsibility reports.

Corporate Responsibility Reports ESG disclosures:
Report of 2019 1H 2020 ESG disclosures
Report of 2018  
Report of 2017  
Report of 2016  
Report of 2015  
Report of 2014  

ESG Risk Rating

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

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.

Sustainalytics