Environmental and climate risks: in-depth analysis and disclosure

[GRI - 102-29], [GRI - 201-2], [GRI - 302-1], [GRI - 305-1],


As noted earlier, climate change is one of the most significant environmental and social challenges of our era. The Conference of the Parties (COP) under the United Nations Framework Convention on Climate Change, held in Dubai in 2023, promoted the formula “transition away”; transitioning away from fossils and achieving carbon neutrality by 2050 (see information box).


The 28th Conference of the Parties (COP28) under the United Nations Framework Convention on Climate Change (UNFCCC) was held in Dubai from 30 November to 12 December 2023 and dealt with the main issues that had emerged from the previous COP27: the need to transition towards a system based on renewable sources and reduce the use of fossil fuels, the request for processing and possible updates to the contributions made at national level (Nationally Determined Contributions - NDC), the establishment of a Fund for losses and damages, which recognises compensation to developing countries that are more vulnerable to the eects of climate change.

As required by the Paris Accord, work was done during COP28 on the third phase of the global stock-take on climate (GST) relating to an assessment of all the national commitments undertaken (Nationally Determined Contribution – NDC)153. It emerged that in summing up all the national commitments and assuming that the goals they contained were fully achieved, the goal of limiting the average temperature increase to less than 1.5°C compared to to pre-industrial levels, is still a long way o. The parties therefore entered into an agreement to accelerate the global transition,

promoting the formula transition awayand drawing up a roadmap to drastically reduce the use of coal, oil and gas. For the first time in history, the agreement makes explicit reference to transitioning away from fossil fuels to achieve climate neutrality by 2050. New goals were set in this regard: triple renewables and double energy eciency, accelerate eorts to eliminate energy production from coal without osetting, eliminate inecient fossil fuel subsidies and promote the acceleration of zero and low emission technologies, including nuclear and carbon capture and storage technologies. With the aim of aligning national goals and measures to the Paris Accord, countries were asked to make new nationally determined contributions. Parties needed to submit their NDCs for 2035 by COP30, in line with the best scientific data available and results of the global stock-take.

Finally, an agreement was reached on how the Loss and Damage Fund would work. This had been created and adopted to support countries that were more vulnerable to climate crises, with Italy committing to an allocation of EUR one hundred million in this regard. The next COP29 conference will be hosted in 2024 in Baku, the capital of Azerbaijan.

Acea continued its climate-change mitigation and adaptation strategy with increased energy eciency in Companies, and regarding water, the reuse of purified wastewater as process water in plants; implementing actions aimed at increasing the resilience of infrastructure; adopting a plan to significantly increase generation from renewables154 and the dual objective of achieving a high level of eciency for final domestic usage and usage in energy processes and reducing carbon intensity (gCO2/kWh produced). The results obtained to date are positive – for example, only considering the energy generation plants of Acea Produzione, Ecogena (excluding heat) and from waste-to energy, a 20% decrease was recorded during the year in the specific intensity index for direct emissions (Scope 1) compared to 2022. Table 66 illustrates the energy intensity indices and Table 71, the emissions intensity indices.

Acea assesses climate risks, classifying them into physical and transition risks, in accordance with the CDP Questionnaire and with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).

Following a second project carried out in synergy with the main Group companies155 during 2022, Acea published the Climate-related Disclosure 2022 in December 2023, detailing the analysis of the different types of risk generated by climate change on the businesses managed (see the information box).


Acea, which has long been aware of the global challenge of climate action through to its experience with CDP, has aimed to expand its knowledge of the application of international climate scenarios through the development of two consecutive projects, of which the most recent in 2022, on the application of the approach recommended by the Task Force on Climate-related financial Disclosures (TCFD). The 11 Recommendations issued by the TCFD on Climate-Related Financial Disclosures represent the benchmark model at international and EU level. They are applicable to all organisations, are focused on risks and opportunities connected to climate change and increasing the capacity for a panorama based on precise analyses of scenarios. The 2022 project involved the main Group companies, operating in the water, energy production, energy distribution, and waste treatment and recovery sectors, to identify the physical and pertinent transition risks, as well as quantify the economic-financial impact of the risks described.

Certain key Parent Company functions also participated, especially during the phase to prioritise the risks identified. Once the priority risks to be evaluated and compared with the more representative scenarios and parameters were identified, the in-depth analysis began. In the scope of physical risks, most Companies selected the risk of drought and water stress. The risk of extreme precipitation and flooding (Acea Produzione, Areti and Gori), heat waves (Areti) were also examined. The outcomes of the scenario analysis on the risk of lightning strikes (Acea Ambiente and Acea Produzione), developed during the previous two-year period (2020-2021) were also confirmed as valid. In terms of transition risks, carbon pricing was identified as the most representative risk by most of the Companies involved.

For further details, see the Acea Climate-related Disclosure, available on the link: https://www.gruppo.acea.it/il-nostro-impegno/ informativa-climatica-tcfd.

153 Work was done on the third and final phase of the Global Stock-take (GST) at COP28 in Dubai. This referred to the more political segment, where delegates of the parties decided on the wording that would be included in the document for its final approval. The second phase had been completed in September (started in June 2022). This referred to the more technical segment, with the publication of a summary document that assessed and summarised what had been done globally since the signing of the Paris Accord at COP21 in 2015. The first, involving the collection of data, had begun after COP26 in Glasgow, and required member countries to send in their climate action plans, i.e. an inventory of the emissions produced, the goals for medium (2030) and long-term mitigation (2050), and adaptation plans.
154 In particular, in 2023 the output of the photovoltaic plants of the investee company reached 84.3 MW. Added to the 16.7 MW of Acea Production, total installed capacity stood at 101 MW.

155 In 2022, along with Acea Ato 2, Areti, Acea Produzione and Acea Ambiente, the companies Acea Ato 5, AdF, Gori and Gesesa took part in the TCFS project.