million tons of greenhouse gases
of renewable energy produced,
equivalent to the consumption
of 190 thousand families
in the carbon footprint of energy
production compared to 2015,
aiming at -22% by 2021

The commitment to reduce our greenhouse gas emissions

Fossil fuels contribute to climate change and reducing their use is therefore essential to limit the increase of the main and most common greenhouse gas: carbon dioxide.

The Group’s commitment originates in the transparency and accountability of its actions and its commitment to fight climate change and continues throughout the many projects it has initiated to promote energy production from renewable sources, to reduce energy consumption and to provide its customers with opportunities to reduce their greenhouse gas emissions.

Since 2006, in fact, the Hera Group has been a member of the Carbon Disclosure Project (CDP), an independent not-for-profit organization that offers businesses and countries a way to measure, track, manage and share information about climate change and on the sustainable use of water resources on a global scale. Compliance with the CDP requires measuring and reporting all its performance and the initiatives it takes to reduce greenhouse gas emissions. In 2017, Hera achieved an A- level on an A-D scale, improving its previous year’s results.

The Group’s greenhouse gas emissions are mainly due to its plants (waste-to-energy and district heating plants), and to leaks from the gas network and from landfills.

Total greenhouse gas emissions
2015 2016 2017
Direct emissions (scope 1) (t CO2) 1.533,410 1.396,716 1.426,401
Indirect emissions from consumption of electricity (scope 2 market based) (t CO2) 268,909 295,393 193,746
Total of scopes 1 and 2 (t CO2) 1,802,318 1,692,110 1,620,147
Carbon intensity index (t CO2 CO2 emitted scope 1 and 2/EBITDA Euro mln) 2,038 1,845 1,645
Indirect emissions from consumption of electricity (scope 2 market based) (t CO2) 205,430 210,855 245,542

Composition of total greenhouse gas emissions

In 2017, the Hera Group released 1.6 million tonnes of carbon dioxide (-4% compared to 2016). Direct emissions (scope 1) amounted to 1.4 million tonnes, down 3.5% compared to 2016 at the same perimeter mainly due to (i) a reduction in greenhouse gas emissions from waste-to-energy plants (-9.3%) due to a reduction in the organic fraction of treated waste as a result of the increase in separate waste collection; (ii) a reduction in emissions from landfills (-6.5%), which was affected by lower landfill use and, to a greater extent in 2017, the upgrade of the biogas recovery system at the Il Pago (FI) landfill, resulting in lower methane emissions (-18,417 tonnes of greenhouse gases).

Emissions indirectly caused by electricity consumption (scope 2) amounted to 194,000 tonnes, a sharp decrease compared to 2016 (-34%), as a result of Hera Spa’s decision to purchase electricity from renewable sources (43% of the Group’s total consumption). This has allowed the Group to save about 146,000 tonnes of CO2, 10% of the Group’s total compensating for the increase in electricity consumption following the entry of Aliplast into the corporate scope, as indicated in the paragraph “Promotion of energy efficiency”.

As part of the ISO 50001 management system, 226 energy consumption reduction measures have been defined by Hera Spa, AcegasApsAmga and Marche Multiservizi, some of which have been implemented and some of which will be implemented by 2020, and which achieve an overall savings of over 10,092 toe/year (in line with the 2020 target of reducing consumption by 5% compared to 2013) and over 19,000 tonnes of CO2 per year. In addition, 66 other energy efficiency improvement measures have been implemented, are in progress or are planned by Herambiente, Hera Servizi Energia and Hera Luce, for a total of 6,302 toe/year of overall savings, reaching approximately 12,000 tonnes of CO2 per year.

The ratio between carbon dioxide emissions and the Group’s gross operating margin shows a decrease compared to 2016 (-19%) mainly due to the reasons described above. The revenue ratio also shows a significant reduction in 2017, decreasing from 379 to 288 t of CO2 per million Euro.

The Carbon Footprint of Energy Production
2015 2016 2017
Waste-to-energy plants (t) 438,874 415,350 376,630
District heating (t) 224,868 212,035 214,215
Landfills (t) 361,807 269,965 252,429
Total (t) 1,025,549 897,351 843,274
Electricity and thermal energy produced by plants (MWh) 1,633,868 1,583,247 1,599,165
Carbon footprint for energy production (kg/MWh) 628 567 527

DEFRA coefficients were used to estimate vehicle emissions, and the Ispra coefficients were used to estimate electricity consumption emissions.

Considering the emissions produced by the electricity and thermal energy plants shown in the table, the carbon footprint of our energy production in 2017 was 527 kg/MWh, 7.0% lower than it was in 2016, due to the lower emissions of waste-to-energy plants and landfills, as described above. The measures carried out and planned by the Hera Group will enable us to further reduce the carbon footprint of our energy production in the years to come. By 2021, we expect to decrease the carbon footprint of our energy production by 22% (484 kg of CO2/MWh) compared to 2015 by building two new landfill biogas power plants, a plant to produce bio-methane from organic waste and by further decreasing the use of landfills to treat municipal waste.

The EU-ETS (European Union Emission Trading System) sets a cap on the total level of emissions allowed to all participants in the scheme, but it also allows them to trade emission quotas on the market according to their needs and within the set limits. The Hera Group has 9 plants that are authorized to emit greenhouse gases on the basis of Emissions Trading regulations, for a total installed furnace power of 520 MW. The carbon dioxide emissions recorded in 2017 at these plants amounted to approximately 178,000 tonnes, up 6% compared to 168,000 in 2016, due to weather differences and greater use of the Casalegno Imola plant. For all the plants concerned, the maximum emissions limit set for 2017 is 42,457 tonnes, in line with the previous year thanks to the new rights acquired by the Cogen Barca plant, thanks to the new plant layout, which partly offset the planned drop envisaged by the regulatory system. The free quota allocation amounted to 24,070 tonnes.

In 2017, emissions classified as scope 3 were calculated for the first time, i.e. indirect greenhouse gas emissions that occur as a result of the company’s activities, but from sources that are not owned or directly controlled by the organization. This category may include both activities upstream and downstream of the business perimeter, such as the extraction and production of purchased raw materials or emissions related to the use-phase of products sold. The total emissions of the categories considered in the calculation amounted to more than 19 million tonnes, a value ten times higher than that of the Group’s total direct and indirect emissions (scopes 1 and 2). The highest values are related to the sale of electricity and gas (16.5 million tonnes) and to the production of electricity by associated companies (1.6 million tonnes).

Greenhouse gas emissions avoided (thousands of tonnes)
2016 2017
Energy production from renewable sources 243.5 240.8
White certificates 763.4 496.2
Internal energy efficiency measures 12.1 19.3
District heating 129.2 125.7
Separate waste collection 205.3 209.4
Electricity from renewable sources sold 1,234.0 867.7
Total 2,587.4 1,959.1

Considering the emissions avoided by the production of energy from renewable sources, energy saving initiatives, district heating, separate waste collection and the sale of electricity produced from renewable sources to customers, total greenhouse gas emissions avoided in 2017 amounted to 2.0 million tonnes. This amount includes 144,000 tonnes of emissions avoided thanks to Hera Spa’s purchase of entirely renewable energy, starting in 2017. Comparing this value to the number of inhabitants served by the Group, 446 kg of greenhouse gases per person were avoided by Hera’s activities. The decrease in greenhouse gas emissions avoided by the sale of electricity from renewable sources is almost entirely due to the change in the composition value of the national complementary energy mix (GSE data) which in 2015 had a 27% share of renewables while in 2016 this value fell to 16%.