Climate change objectives

Reykjavik Energy Group aims to achieve carbon neutrality by 2030.

The Group has selected year 2016 as base year. 2016 is representative of the company’s typical Green House Gas (GHG) profile and is a sufficient baseline for the GHG target to show forward-looking ambitions. Furthermore, the selection of 2016 as base year ensures continued relevance and alignment to GHG accounting best practices.

In 2022, the emission of greenhouse gasses increased from the Reykjavik Energy Group. The decreased capture and storage of carbon dioxide into basaltic bedrock at Hellisheidi has the largest impact on increased greenhouse gas emissions from the Group in 2022. The percentage of reinjected and sequestered carbon dioxide from the Hellisheidi Geothermal Power Plant amounted to about 26% of its emissions. This is an increase from 2020. Electrical- and methane energy switching of the company's vehicle fleet also plays a crucial role, as well as proactive projects at Veitur Utilities, that aim at boosting the resilience of the utilities systems, due to climate crisis, please see appendices.

Emissions due to employees' commute and airline commute has increased in 2022 after COVID-19 ended. About 39% of the employees have entered a remote work contract with the group so that they work from home one to two days a week, and this has reduced emissions. Air travel has increased significantly, please see appendices.

The Reykjavik Energy Group has purchased certified emission allowances through the United Nations climate agreement. The permits are used to carbon offset emissions from Reykjavik Energy's car fleet, emissions from air travel due to employee's business travels, emissions from commuting, as well as part of the company's other emissions. The project funded by Reykjavik Energy in 2022 consists of improving clean cooking in Malawi, which reduces the emission of greenhouse gases, improves air quality, and contributes to the improvement of the health of women and children.

Guarantee of origin for electricity has been in place for the Group's total consumption of electricity, from 2016 to 2022.

Operations at Hellisheidi and Nesjavellir Geothermal Power Plants are carried out under a scheme that aims for a zero carbon footprint in 2025 and 2030, respectively. This means that 95% of the carbon dioxide emitted from the power plants, will either be captured and stored, or utilised.

Greenhouse gas emissions are calculated in accordance with the standard Greenhouse Gas Protocol – Corporate Accounting and Reporting Standard. In 2022 Reykjavik Energy started cooperating with the Science Based Target Initiative on certification of the group's climate goals.

Direct and indirect GHG emissions

In 2022, Scope 1, or direct emissions from the Reykjavik Energy Group's core operations, amounted to approximately 49,000 tonnes of CO₂ equivalents. Scope 2, or indirect emissions, was none due to the fact the Group produces the power it uses in its own core operations. These emissions are already accounted for in scope 1. Scope 3, or indirect emissions in the value chain, was approximately 1,900 tonnes of CO₂ equivalents. These indirect emissions can mostly be attributed to fuel consumption by construction contractors and waste generated in Veitur's sewage system. Scope 3 also takes other operational waste into account, business flights and commuting to and from work. The data for scope 3 are not exhaustive, as production of resources is not included. A project has been started to determine the role of procurement in the Group’s carbon footprint. Reykjavik Energy aims to weigh climate issues more heavily into procurement in the future. Steps have already been taken in tenders where contractors, suppliers, and manufacturers supply Reykjavik Energy with information regarding their product ‘s or service ‘s carbon footprint. Furthermore, financial rewards are provided by Reykjavik Energy for environmental aspects such as energy shift in contractor’s machines and devices and for them working according to certified environmental management systems.

Reykjavik Energy Group accounts for approximately 1% of Iceland's total GHG emissions, based on total emissions recorded in 2020 (Environment Agency of Iceland, 2022).