Pillar 3: Climate actions

WE BELIEVE THAT ONLY LOW CARBON & REGENERATIVE ECONOMIC MODELS WILL ENSURE SUCCESSFUL BUSINESS GROWTH IN THE FUTURE

For me, Climate Action is not only a business topic, but also a
question of responsibility for the future. Looking at my daughter’s
artwork is a simple reminder that the choices we make today will
matter in shaping the world our children will inherit tomorrow.
In daily operations, this means improving step by step, and I am
proud to contribute to a Group that takes this journey seriously.

Michael Brehm
Fleet Management / HSEQ, SSE Deutschland

CLIMATE TRANSITION – EMBEDDING CARBON IN DECISION-MAKING

In 2025, SSE took a decisive step forward in its climate journey by moving from measurement to structured decision-making.

Building on its first Group-level carbon footprint, the Company focused on integrating carbon considerations into both operational actions and strategic planning across its value chain.

To support this transition, SSE developed an approach combining actions that can be implemented now without waiting for strategic decisions with long-term decarbonisation pathways.

This dual dynamic enables the Group to reduce emissions today while progressively embedding carbon into investment choices, operational priorities and future development scenarios.

By strengthening the link between data, action and decision-making, SSE is laying the foundations for a more consistent, informed and scalable climate transition.

Three drivers for Climate at SSE

Decarbonise our value chain
Sustainable management of the environment
Embrace circularity

“Building our first carbon footprint gave us much more than a baseline — it revealed where our real impact lies across the value chain and challenged some of our assumptions. In 2025, we worked across the organisation to develop decarbonisation scenarios, exploring what different transition pathways could look like for SSE. Some insights proved counter-intuitive, pushing us beyond conventional thinking. Beyond carbon reduction, this work is also becoming a powerful lever for optimisation, efficiency and more informed decision-making across the Group.”

Agnieszka Gasiorowska,
Head of Sustainability, SSE Group
Climate Actions Pillar Leader

In 2025, SSE structured its climate approach around two complementary time horizons, forming a single integrated decarbonisation system.

At strategic level, the Group developed a set of 16 decarbonisation scenarios, providing a first assessment of emission reduction potential, operational feasibility and financial implications. These scenarios are currently under expert review to support future Board-level decisions.

In parallel, SSE launched a Decarbonisation Guidebook, enabling the deployment of immediate actions at local level. Piloted in Romania and extended to the Czech Republic, it is designed for progressive rollout across all markets in 2026, delivering early emission reductions while strengthening operational and data foundations.

Together, these two dimensions enable SSE to embed carbon into decision-making, combining immediate impact with the preparation of long-term, data-driven climate pathways.

UNDERSTANDING OUR CARBON IMPACT IN OUR VALUE CHAIN

Building on the first Group-level carbon footprint established in 2024, SSE deepened its understanding of emissions across the value chain. This analysis highlights key emission hotspots and provides a clear basis to prioritise decarbonisation efforts.

KEY LEARNINGS

Raw materials are the primary driver of SSE’s carbon footprint
Emissions linked to raw materials acquisition alone represent 60.88% of total emissions, making it the most significant decarbonisation lever.
Emissions are concentrated in upstream activities
Including purchased goods and services, which account for 63% of total emissions, confirming the dominant role of Scope 3.
Scope 3 represents the majority of total impact
At approximately 88.6% of total emissions, requiring engagement beyond SSE’s direct operations.
Operational emissions remain critical for immediate action
Scope 1 and 2 are directly controllable and can be reduced through energy transition, electrification and efficiency improvements.
Effective decarbonisation requires action across the full value chain
Combining operational levers (energy transition and efficiency) with Scope 3 levers such as supplier engagement, material choices, logistics optimisation and low-carbon product innovation and availability at scale.

Carbon Footprint

THIS ANALYSIS HIGHLIGHTS THE MAIN EMISSION HOTSPOTS ACROSS SSE’S VALUE CHAIN, WITH A STRONG CONCENTRATION IN UPSTREAM ACTIVITIES.

Defining decarbonisation pathways

Building on the understanding of our emission hotspots across the value chain, SSE structured its decarbonisation approach to move from insight to action. Rather than focusing on isolated initiatives, the Group adopted a structured methodology to explore how different levers can be combined to drive meaningful emission reductions.

Defining decarbonisation pathways

“By modelling scenarios such as HypexBio based solutions, we gain a clearer understanding of where the most meaningful emission reductions can be achieved, and under which conditions they can be developed and scaled. This approach helps us identify promising pathways, while progressively assessing their feasibility, scalability and alignment with our business and industrial realities.”

Markus Troger
CBDO SSE Group

CLIMATE CLOSER LOOK

CLIMATE | SCENARIO-BASED APPROACH TO 2035

SSE developed a set of 16 scenarios to define its decarbonisation trajectory by 2035, each combining different levers across energy, operations and the value chain. Each scenario evaluates emission reduction potential over a 10-year timeframe, together with associated capital and operational expenditures, providing a comprehensive view of both impact and investment requirements.

This approach enables the Group to explore multiple pathways to reduce emissions, while assessing their feasibility, operational implications and potential return on investment.

By combining operational and financial perspectives, the scenario approach allows SSE to identify pathways that are both impactful and economically viable for the Group.

SSE structured its decarbonisation approach around three main families of levers, illustrated through concrete operational actions:

ENERGY TRANSITION & EFFICIENCY

Focusing on energy optimisation across operations, electrification of equipment and processes, and the transition to renewable energy sources.

Examples:

Replacing diesel-powered equipment with electric alternatives at production sites
Optimising energy consumption in manufacturing processes (e.g. blasting, mixing, heating)
Switching to renewable electricity contracts or on-site energy production

OPERATIONS & MOBILITY TRANSFORMATION

Addressing process optimisation, industrial efficiency and the reduction of fuel consumption across operations and logistics.

Examples:

Optimising drilling and blasting operations to reduce energy and material intensity
Reducing fuel consumption through fleet optimisation and logistics planning
Improving transport efficiency through route optimisation and load management

VALUE CHAIN & PRODUCT EVOLUTION

Targeting supplier engagement, material optimisation and the development and scaling of low-carbon product solutions.

Examples:

Working with suppliers to reduce emissions linked to raw materials (e.g. explosives inputs, chemicals)
Replacing diesel-powered equipment with electric alternatives at production sites
Substituting high-materials with lowercarbon lower-carbon alternatives where feasible manufacturing processes (e.g. blasting, mixing, heating)
Developing low-carbon product formulations and ensuring their availability at scale

Carbon Footprint

THIS ANALYSIS HIGHLIGHTS THE MAIN EMISSION HOTSPOTS ACROSS SSE’S VALUE CHAIN, WITH A STRONG CONCENTRATION IN UPSTREAM ACTIVITIES.

SSE VALUE CHAIN – CIVIL EXPLOSIVE & FINE CHEMICALS
Life cycle stages and processes

SCOPE 3 – INDIRECT

SCOPE 1 – DIRECT & SCOPE 2 – INDIRECT

SCOPE 3 – INDIRECT

“Our carbon footprint has moved us beyond measurement to a clearer understanding of where our impact lies across the value chain. It allows us to focus on the most relevant levers — across operations, sourcing and logistics — and to prioritise actions where they create the greatest value. This insight now informs both immediate actions and the structuring of our long-term decarbonisation pathways.”

Neil Kirby
Project Controller SSE Group
Decarbonization Project Sponsor