A LOOK AT THE RISKS AND OPPORTUNITIES
The Group also launched a study on the transition risk related to a European alignment with a 15C trajectory the results will be
communicated in accordance with the CSRD Directive
1
1 Corporate Standard Reporting Directive
TRANSITION RISKS REVIEW – CLIMATE MITIGATION
ENGIE gas networks: a necessary transformation
toward total decarbonization
The reduction of the volume of gas in certain networks
(transport, storage or distribution) or in certain sectors
(buildings, electricity production) and the imposition
of stricter carbon criteria for methane currently represent
the most significant risks for ENGIE’s activities
and for its gas networks in particular.
The acceleration of Europe’s climate ambitions
cannot be accomplished without the use of
these assets, which guarantee European energy security
and decarbonization through their transformation.
• Continuity of the methane supply and the coupling of different
energy vectors are essential for a decarbonized energy
system since they can support the electricity network during
demand peaks. This is especially true with the development
of hybrid heat pumps.
• French networks guarantee the gas supply in Europe
in a complex geopolitical environment and will,
in the future, enable the distribution of biomethane
synthetic gas and even hydrogen. They provide assurance
to the French and European system in the event
of incidents on the other energy vectors (unavailability
or delay in the nuclear fleet, for example).
• Finally, a good portion of the transport or storage
network can be converted to hydrogen.
Renewable electricity:
a supply chain that is mature but under pressure
and a growing demand for exemplary behavior
The supply of renewable electricity is
a key element in ENGIE’s decarbonization.
At a time of accelerated development of new installed
capacities, the manufacturing ability of the wind and solar
components and batteries industry will determine
the extent to which operators are able to meet
their climate ambitions.
Thus, the value chain is a key element in the strategy
implemented by ENGIE, which has set up an action
plan designed to best integrate these risks
in investment decisions, reduce its exposure
to them by promoting the reuse and ecodesign
of turbine components the Zebra project
or solar panels and diversify its supply chain
Low carbon gas: promising technologies
to be industrialized
Accelerating decarbonization is also based on
a massive roll-out of low carbon gases
(biomethane, hydrogen and synthetic methane),
which requires substantial investment in capital
and human resources. These technologies remain
exposed to regulatory constraints and growing conflicts
of use (e.g. wood energy or agricultural waste).
Sufficient production quantities will be necessary,
particularly to guarantee the continuity of the gas-fired
power plants, which are responsible for ensuring
the balance of the electricity networks. The need
to transform or build adapted networks
could also delay the hydrogen economy.
The Group is committed to a proactive role
in low carbon gases to minimize the hazards
to its business and push back these technological
boundaries. ENGIE thus plays a significant role
in developing the new technologies around
2G biomethane and synthetic molecules (ENGIE Lab),
as well as CCS
(Carbon Capture and Storage),
which will support decarbonization efforts.
An ambition facing major
social and societal challenges
The energy transition that ENGIE is undertaking
includes major social transformations, particularly
with employees, the regions, customers and suppliers.
These transformations carry a reputational
and development risk for the Group, such as
the exclusion from certain markets on the basis
of the requirements in bid tenders and
their criteria for sustainability, or the lack
of competitiveness to attract talent.
In addition to its climate ambitions, the Group
is also committed to a Just Transition
(see the dedicated notebook) to assist
its most disadvantaged customers the regions
in which the Group operates and the employees
when fossil activities are closed down especially
in the case of the coal phaseout the coal phaseout
Development of renewable energy both mature
and in development requires an increase in training
that is both quantitative number of persons trained
and qualitative level of expertise In this regard
ENGIE has set up training courses to enhance
the skills of its employees
Renewables Academy
72 - CLIMATE NOTEBOOK