Our approach to climate change

Here we report on our latest progress and plans on cutting emissions to reduce future climate change, known as climate mitigation, and how we are maintaining and improving our resilience to climate change, known as climate adaptation.

Task Force on Climate-related Financial Disclosures

Here we share our greenhouse gas emissions (GHGs) and progress towards meeting our six carbon pledges and science-based targets (SBTs). We present our six most sensitive climate risks and our new adaptation report. In this section, supported with content elsewhere in this integrated report and on our website, we include disclosures consistent with the TCFD Recommended Disclosures all sector guidance.

Download the Energy and carbon report

Singles | Spreads

Our six carbon pledges

Pledge 1

Reduce scope 1 & 2 emissions

↓ 2.2% compared to baseline

We are making good progress towards our science-based target to reduce scope 1 and 2 emissions by 42% from our baseline by 2030.

2021/22: 135,936 tCO2e

2019/20: 138,961 tCO2e (baseline year)

Pledge 2

100% of electricity used from renewable sources

We achieved this pledge from October 2021

From October 2021 the electricity we purchased was from guaranteed renewable sources. In addition, we generated a record 210 GWh of renewable energy in 2021/22, equivalent to 26% of our total electricity consumption.

Pledge 3

100% green fleet by 2028

27 fully electric vehicles (EV) now deployed in our fleet with plans for 200 low carbon vehicles by 31 March 2025

We have installed advanced telematics to improve understanding of travel patterns and are trialling options for larger vehicles. We are enabling employees to shift to EV through changes to the company car policies and launch of a salary sacrifice scheme ‘EVolve’.

Pledge 4

1,000 hectares of peatland restoration by 2030

Restoration activity well underway

We have restoration projects across the North West at different stages of maturity. As well as continuing our site work to completion, we aim to become an early pioneer in applying the Peatland Code at scale to independently verify the carbon benefits.

Pledge 5

Create 550 hectares of woodland by 2030

9 hectares planted and validated to the Woodland Carbon Code

Planting in 2021 was postponed due to weather and tree disease. The remaining 541 hectares have been planned and the funding identified.

Pledge 6

Set scope 3 science-based target

Targets verified by SBTi

Emissions from our value chain are the most challenging to address so we are working with our supply chain. We are exploring how to improve our calculation methods for scope 3 emissions so that we can consider and openly report the impact of our management choices.

Pledge 1

Reduce scope 1 & 2 emissions

2.2% compared to baseline

We are making good progress towards our science based target to reduce scope 1 and 2 emissions by 42% from our baseline by 2030.

2021/22: 135,936 tCO2e

2019/20: 138,961 tCO2e (baseline year)

Pledge 2

100% of electricity used from renewable sources

We achieved this pledge from October 2021

From October 2021 the electricity we purchased was from guaranteed renewable sources. In addition, we generated a record 210 GWh of renewable energy in 2021/22, equivalent to 26% of our total electricity consumption.

Pledge 3

100% green fleet by 2028

27 fully electric vehicles (EV) now deployed in our fleet with plans for 200 low carbon vehicles by 31 March 2025

We have installed advanced telematics to improve understanding of travel patterns and are trialling options for larger vehicles. We are enabling employees to shift to EV through changes to the company car policies and launch of a salary sacrifice scheme ‘eVolve’.

Pledge 4

1,000 hectares of peatland restoration by 2030

Restoration activity well underway

We have restoration projects across the North West at different stages of maturity. As well as continuing our site work to completion, we aim to become an early pioneer in applying the Peatland Code at scale to independently verify the carbon benefits.

Pledge 5

1,000 hectares of peatland

9 hectares planted and validated to the Wo

We have installed advanced telematics to improve understanding of travel patterns and are trialling options for larger vehicles. We are enabling employees to shift to EV through changes to the company car policies and launch of a salary sacrifice scheme ‘eVolve’.

Pledge 6

Set scope 3 science-based target

Targets verified by SBTi

Emissions from our value chain are the most challenging to address so we are working with our supply chain. We are exploring how to improve our calculation methods for scope 3 emissions so that we can consider and openly report the impact of our management choices.

TCFD - our progress and future focus

Risk management

TCFD definition

How the organisation identifies, assesses and manages climate-related risks.

Progress this year

  • Published our third adaptation report, including the outcome of a progress review of climate-related risks across the organisation.
  • Greater recognition of transitional risks in our corporate risk management system, in particular the investment needed to meet our carbon commitments and the potential costs to the business if we do not.

Future focus

  • Produce our PR24 business plan with full integration of carbon reduction and climate resilience priorities.
  • Finalise and publish our 2022 Drought Plan.
  • Improve our long-term strategic plans for water resources and drainage, integrating advanced climate change analysis to shape our investment and operational approaches in the short, medium and long term (up to 80 years).
  • Embed climate change impacts into corporate decision-making tools and processes.

Governance

TCFD definition

The organisation’s governance around climate-related risks and opportunities.

Progress this year

  • Oversight and scrutiny of climate change matters by the board and its committees, including approval of our new science-based targets, and review of the adaptation progress report and carbon commitments risk.
  • Strengthened governance by expanding our director-led climate change mitigation steering group and introduced six new cross-business working groups.
  • Introduced carbon measures into the executive remuneration framework.
  • Expanded our internal carbon and climate change teams.
  • Supplemented public disclosures through conversations with investors and participation in new climate-related indices and assessments.

Future focus

  • Communication and engagement programme with all stakeholder groups.
  • Deploy whole-life carbon costing using an internal carbon price aligned to government carbon values.

Metrics and targets

TCFD definition

The metrics and targets used to assess and manage climate-related risks and opportunities.

Progress this year

  • The first UK water company to have targets verified by the SBTi, including for scope 3 emissions. Achieved our pledge 6.
  • Delivered pledge 2: 100 per cent of electricity purchased has been renewable since October 2021.
  • Reduced scope 1 and 2 emissions by 2.2 per cent (gross) and 3.5 per cent (net) compared to our baseline year 2019/20.
  • Improved data collection and tracking of fuel use enabling targeted interventions.

Future focus

  • Data improvements for scope 3 emissions with more supplier and product-based estimates, rather than spend-based.
  • Work to validate our long-term net zero ambition to the new SBTi Net Zero Standard.
  • Use BEIS carbon values as an internal carbon price in our planning for medium and long-term investments, including PR24 (e.g. for 2030 we use the low case value of £140/tCO₂e).

Strategy

TCFD definition

How climate-related risks and opportunities impact the organisation’s businesses, strategy and financial planning.

Progress this year

  • Built relationships with key suppliers to reduce environmental impact by sharing best practice and collaborating on how to reduce GHGs.
  • Further developed our multi-capital approach to enhance decision-making processes, integrating both GHG impact and attributes of climate resilience.
  • Implemented climate change resilience plans (both physical and transitional) across AMP7, incorporating natural capital solutions.

Future focus

  • Further develop our mitigation and adaptation strategies and delivery plans.
  • Include low carbon and climate adjustable approaches in our PR24 business plan.
  • Assess and limit the carbon impact of our PR24 business plan.

Twin track approach to climate change

twin track diagram
Annual Report cover