EnBW has presented a new sustainable corporate strategy that includes a schedule to halve its CO₂ emissions by 2030 and become climate neutral by 2035.

To reach the target, the German utility has already discontinued 40% of particularly carbon-intensive generation, and plans to reduce its current coal-based generation capacity of 4.6GW by another 2.5GW by 2030, and shutter the remainder by 2035.

“We will benchmark every decision and every investment against these criteria, thereby firmly linking our future growth to sustainability,” chief executive Frank Mastiaux said.

The coal exit date seems late for a company that started its own energy transition away from nuclear and fossil generation as early as 2013 and is majority-owned by the state of Baden-Württemberg, which is governed by a coalition led by the Green Party.

But chief financial officer Thomas Kusterer defended the strategy now approved as a realistic path taking into account politics, society and financials.

“An ambitious target is one thing; a transparent route to the target, while ensuring it can be verified at any time, is another,” Kusterer said.

“We place great emphasis on this in the course of our constant dialogue with society and the world of politics. It is also especially important with regard to the capital market, which demands a clear-cut course here.”

Faster than RWE

The net-zero pledge comes as Germany’s government earlier this year has stipulated that the country would exit coal and lignite generation by 2035-38.

EnBW’s main rivals in the German market, compatriot RWE and Sweden’s Vattenfall, have set relatively late coal exit dates.

RWE – both one of Europe’s largest producer of fossil-based and of renewable energy – has promised to exit coal by 2040, while Vattenfall has pledged to become fossil-free “within one generation”, although the Stockholm-headquartered utility hasn’t specified an exact time-frame for this target.

Mastiaux said an extensive, 25-point package of measures, would be implemented in coming years to reach climate neutrality, organised along aspects of ecology, economy and social welfare.

The company’s services unit Energiedienst AG is already climate-neutral, while its grids division Netze BW will follow at the start of next year.

Fuel switch

EnBW will examine the possibility of switching from coal to more climate-friendly gases in the first phase, and then moving to carbon-free green gases or hydrogen in a second stage.

“Depending on market conditions and the political backdrop, we will make an instantly effective contribution to cutting carbon emissions with a fuel switch, while also securing the energy supply and preserving sites and jobs,” chief technology officer Hans-Josef Zimmer said.

He added, however, that the exit from coal will be linked to job cuts at the affected sites.

“In the future, all of our investments will be made on the basis of sustainability criteria, which will also have a positive effect on our jobs situation,” Kusterer said.

“The focus will remain on the continued expansion of renewable energies as well as the electricity and gas grids.”

“This will be increasingly complemented by further aspects of sustainable infrastructure and sustainable business practices, such as the key role played by electric mobility in transforming the transport landscape and protecting the climate, or the importance of telecommunications as the backbone of a modern and digital society.”

Transition

EnBW rolls out 'future growth' roadmap to reach climate-neutrality by 2035