CLIMATE

Our management standards and systems mitigating direct environmental impacts have evolved towards strategic measures reducing the Group's contribution to climate change, as well as adaptation of the business models to address the effects of the physical consequences of climate change on the Company's assets.

Climate change poses a significant challenge to PKN ORLEN and the ORLEN Group companies. The global energy transition that is taking place before our eyes is a huge development opportunity for Central Europe. As the largest company in the region, we want to increase our involvement in this process.

The ORLEN Group views climate change risks as both business challenge and an opportunity for growth, which, however, will depend on awareness and resilience of the business models to the coming green transformation. We are prepared for these challenges and are ready to be part of Europe’s energy transition. Changes in the operation of power systems forced by new technologies and climate change are an integral part of PKN ORLEN’s strategy and business risk assessment. We manage climate change risks in a systematic and strategic way, taking into account market, regulatory, technological and reputational aspects.

The Paris Agreement aims to maintain global warming within the limit of 1.5°C. The EU climate legislation and relevant sector-specific rules (including ETS, RED2, FQD and EED) provide guidance to the industry on how to achieve the Paris Agreement targets. Reinforcement of the regulatory framework is expected given the new European commitments to reduce greenhouse gas emissions by 55% by 2030. We are an active participant in these changes and is monitoring the progressive strengthening of climate regulations through the European Green Deal.

PKN ORLEN has addressed those challenges by announcing in September 2020, as one of leaders in Central Europe, an intention to achieve net zero carbon footprint by 2050. In furtherance of this goal, we aim to reduce carbon emissions from the Group’s existing refinery and petrochemical assets by 20% and cut down carbon emissions per megawatt-hour of electricity by 33% by 2030. Our net zero emissions strategy is based on four pillars: energy efficiency in production, zero-emission power generation, fuels of the future, and green finance.

It is our ambition to reduce our Scope 1, 2 and 3 carbon footprint in a way that reflects the diversity of the Group’s operations, including compensation. PKN ORLEN has developed an approach to its production emissions (Scope 1 and 2), which is outlined in its decarbonisation strategy. In September 2020, we declared the ambition to become a net zero company, with a target of around 20% reduction of the current level of emissions from the Group’s production assets and a 33% emission reduction in electricity generation. PKN ORLEN is working to reduce its carbon footprint along the value chain, recognising also the indirect impacts (Scope 3). We have undertaken to publish the Scope 3 base data in the first half of 2022.

For further information on key policies and procedures governing climate and environmental protection issues at the ORLEN Group, see ‘Policies and internal regulations’  ; for further information on the projects implemented in 2020, see ‘Climate responsibility’ .