Open Power for a Brighter Future. We Empower Sustainable Progress
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OPEN POWER FOR A BRIGHTER FUTURE. WE EMPOWER SUSTAINABLE PROGRESS. SUSTAINABILITY REPORT 2019 SUSTAINABILITY REPORT 2019 01. Letter 4 Commitment to sustainability 1.1. Who we are 10 1.8. Environmental, social and governance ratings 1.2. Driving sustainable and indices 77 progress 17 1.9. Participation in 1.3. Results 2019 31 associations 80 1.4. Risk management 46 1.10. Profile of the report 84 1.5. Materiality study 53 1.11. Coverage of the report 85 1.6. ENDESA’s 2020-2022 sustainability plan 66 1. 7. CIRCULAR ECONOMY 73 2 Sustainability Report 2019 02. 03. 04. Creation of Pillars Appendices sustainable long-term value 2.1. Decarbonisation and 3.1. Good governance APPENDIX I. operational efficiency 89 and ethical conduct 226 ENDESA, committed to information 2.1.1. Decarbonisation 90 3.2. Occupational on sustainability 320 2.1.2. Operating efficiency 112 health & safety 240 APPENDIX II. 2.2. Focusing on people 135 3.3. Environmental Independent review report 322 sustainability 256 2.2.1. Our people 136 APPENDIX III. 3.4. Supply chain 300 GRI content index 324 2.2.2. Responsible relationship with communities 168 2.3. Innovation 191 2.3.1. Innovation 192 2.3.2. Digitalization and Cybersecurity 206 Contents 3 Committed to the new sustainable energy model and a fair and inclusive transition 4 Sustainability Report 2019 102-14 To meet this, in 2019 we announced the closure in the short term of a very significant part of the coal-fired power We are pleased to present the ENDESA Sustainability Report stations: for 2019 which, as in previous years, gives expression to our commitment to transparency in matters concerning sustaina- • Closing of generators 1 and 2 of the Alcudia thermal ble development. power plant, already effective from January 2020, and operation until August 2021 of generators 3 and 4 with a For some years now ENDESA has been committed to the maximum of 1,500 hours per year, after which they will main international reference frameworks promoted by the only be operational for up to 500 hours year. United Nations as a key agent in the construction of a new global and sustainable energy model. Therefore, we main- • Commitment to close the Compostilla and Teruel thermal tain a firm commitment to the Ten Principles of the Global power plants by 30 June 2020. Compact, to the Guiding Principles on Business and Human Rights, and to the Seventeen Sustainable Development • Request to close the As Pontes and Litoral thermal power Goals. In 2019 we confirmed our determination to contrib- plants. ute to the attainment of the United Nations’ Sustainable Development Goals, particularly SDGs 7 (Affordable and Our applications for closure are accompanied by action Clean Energy), 9 (Industry, Innovation and Infrastructure) plans to mitigate the impact caused by the decrease in and 11 (Sustainable Cities and Communities), and most es- activity by promoting the development of economic activ- pecially 13 (Climate Action), to which more than 90% of the ities and generating job creation in the areas where the investments of the 2020-2022 Strategic Plan are dedicated. two plants are located. Additionally, in September 2019 ENDESA also contributes indirectly, through the develop- ENDESA signed its adherence to the United Nations com- ment of social programmes and initiatives, to the attain- mitment in the area of Fair Transition under the “Climate ment of SDGs 4 (Quality education) and 8 (Decent Work Action for Work” initiative that Spain leads together with and Economic Growth). Peru and entities such as the ILO. This past year was especially important for us because in We foresee an increase in electricity demand in the future, November we presented our inspiring and challenging 2020- deriving from greater penetration of electrification. Therefore 2022 Strategic Plan, a plan that presents a firm commitment we must be prepared to meet the new and more complex to a sustainable, dynamic, efficient business model aligned needs of our customers and stay ahead of market trends, an- with the strategic vision of being the leading actor in the ener- ticipating the creation of new, more efficient and sophisticat- gy transformation of society. ed products and services. The 2020-2022 Plan is organised around decarbonisation Development of the electricity grid has long been a fun- and the necessary process of electrification of demand, damental pillar of ENDESA’s strategy. The projected in- creating infrastructures to facilitate these processes and vestment in this area, needed to drive the electrification ecosystems and platforms to support them. To do this, we of demand and the integration of energy from renewable have set ourselves the objective of increasing the installed sources, aims to improve grid quality and efficiency, reduc- capacity in renewables by more than 38% in 2022, with ing operating costs, and increasing the value of the assets associated investment of Euros 3.8 billion. Furthermore, through investments in smart grids and the pursuit of ex- as part of this commitment to decarbonisation, the 2020- cellence. To this end, ENDESA continues to invest heavi- 2022 Plan includes the cessation of mainland coal-fired ly in the digitisation of the network, with Euros 1.1 billion generation in 2022 and the total ending of coal activity earmarked for this in its 2020-2022 Strategic Plan for the in 2030. period 2019-2022. Letter 5 102-14 We thus reiterate our firm commitment to contributing Agreement was signed, between ENDESA and the ma- to the development of a new energy model, based on a jority union UGT. The Framework Guarantee Agreement high degree of electrification from renewable sources, as a for ENDESA, S.A. and its electricity subsidiaries domi- more efficient and sustainable energy vector that ensures ciled in Spain, and the Voluntary Suspension or Termi- a fair and inclusive transition. nation Agreement for employment contracts were also signed. However, there is one particular event that undoubtedly casts a pall over this good news and we which we must • Regarding Occupational Health and Safety, although this mention: at the end of the year there was a terrible tragedy cannot compensate for the sad news of the death of the for all of us who work at ENDESA, the death of one of our ENDESA worker that occurred at the end of the year, it workers, as a result of an accident in the revision work of should be noted that the combined accident frequency the fire prevention system of the Cíjara hydroelectric power rate of own workers and contractors stood at 0.68, clear- station. We take this opportunity to reiterate, on behalf of ly below the 0.80 target. all of us who work at ENDESA, our most sincere condo- lences to his relatives and our absolute commitment to the • In terms of customer service, as a result of the contin- safety and health of all company employees. uous improvement process that we carry out at ENDE- SA, in 2019 we implemented a new way of managing We also want to reflect the main advances made in each of complaints, with a customer and end-to-end view of the our strategic lines and show our commitment to integrating process. This new model led to a 42% reduction in the sustainability into the strategy and operations of our busi- volume of complaints and a 36% reduction in handling nesses. The details that we include in this Report provide times, from 11 days in 2018 to 7.03 in 2019. insight and confirmation that ENDESA is progressing suc- cessfully along these lines. • In terms of Corporate Governance, we worked to define • Regarding decarbonisation, the ambitious strategic plan has and establish a sustainable leadership model that would led us to obtain reductions of 44% in absolute and 32% in allow us to fulfil our economic, social and environmental responsibilities from a balanced and fair perspective. In specific CO2 emissions compared with 2018, in both cases surpassing the objectives set. December 2019, the need to promote diversity as an es- sential factor to ensure competitiveness led us to makes • At ENDESA we continue to give close attention to person- some changes to the Policy on Selection of Directors in al development. During 2019 more than 1,100 employees order to bring ENDESA’s governance into line with best took part in the various actions carried out in ENDESA practices in this area. to enhance their capabilities. We held 2,198 training sessions, in which 9,060 workers took part, reaching an • We realise how important it is to extend our commitment to average of 40.5 hours per employee. sustainability to the supply chain, which is why in 2019 89% of contractors and new qualified ENDESA suppliers were It is also important to highlight the fact that on 23 Jan- examined on criteria relating to human rights, the environ- uary 2020, the Fifth ENDESA Collective Framework ment and Occupational Health & Safety. 6 Sustainability Report 2019 102-14 • ENDESA has followed a shared value creation approach in Our company faces a future of change from a position of the deployment of its activities, combining the interests firm commitment to the society to which we owe ourselves, of the company with the priorities and needs of the local excellence in our performance and our determination to lead communities in which it has a presence. For this we have this transformation. invested Euros 12.5 million in social initiatives, having car- ried out 203 projects that have generated 1,070,620 direct beneficiaries. We must not omit to mention the leading role that ENDESA Juan Sánchez-Calero Guilarte played in the United Nations Conference on Climate Change Chairman (COP 25), held in Madrid between from 2 to 13 December 2019.