This is an extract from a recent speech by Andreas Schell, CEO, EnBW at the company’s 2023 Virtual Annual General Meeting held on May 3, 2023.

The war in Ukraine was a turning point. It also fundamentally changed the energy industry and presented us as a company with major challenges last year.

The cessation of Russian gas supplies and skyrocketing prices clearly put us under massive pressure. Looking back, we can say
that we did our part to ensure a secure energy supply for our country and our 5.5 million customers, even through this difficult
time. We have diversified our sources of supply and reduced the share of Russian coal to zero. And while the tight situation made price increases unavoidable for our customers, our forward-looking procurement strategy enabled us to absorb these as well as possible and keep price adjustments below the market average at all times.

And we will continue to do more in this direction. The energy transition will only succeed if we pool forces and capabilities, and
optimally allocate investment spending. Long-term partnerships are key here. This is also one of the objectives of our planned partial sale of TransnetBW.

Last but not least, we have taken important steps and reached milestones to accelerate the energy transition. As the war made us
all acutely aware, to become less dependent on imports and reduce our carbon emissions, we must accelerate our efforts to increase renewable generation capacity in Germany.

Sustainability and decarbonization are not only goals that we have set for ourselves. They are what all of our stakeholders expect of us, including customers, capital market decision-makers, and the general public.

Sustainability and decarbonization are not only goals that we have set for ourselves. They are what all of our stakeholders expect of us, including customers, capital market decision-makers, and the general public. And rightly so. Because this is how we secure EnBW’s business model for the long term. It is all the more significant that we made major progress in this area last year.

Our climate targets have been evaluated and validated by the independent Science Based Target initiative. This ensures that our
carbon reduction pathway is in line with the 1.5 degree target under the Paris Climate Agreement.

We have a clear plan for gradually reducing our emissions in all emission categories, known as Scopes 1 to 3. Our goal is to be fully carbon neutral by 2035. To achieve this goal, we plan to halt coal-based electricity and heat generation as early as 2028, provided the necessary policy framework is ready in time. Of course, this raises the question of how we will continue to ensure security of supply. How do we make up for the electricity that we previously generated from coal?

We plan to halt coal-based electricity and heat generation as early as 2028, provided the necessary policy framework is ready in time.

There are two key aspects to this: The first is the rapid expansion of renewables. Last year, we took major investment decisions for large-scale projects, especially in the area of offshore wind energy. The second aspect is the expansion of flexible power plant capacity to meet demand when there is not enough electricity available from renewable sources. EnBW is doing this by investing in advanced natural gas-fired power plants that can switch to green hydrogen in the medium term.

At three locations so far, we are making former coal-fired power plants future-ready with fuel switch projects. In this way, we can
ensure a secure supply of energy and at the same time offer longterm prospects for the employees at these sites.

We have made good progress in the area of solar energy. In Brandenburg, we have brought two new solar farms into operation.
Together with a solar farm that went online in 2021, this creates a 0.5 gigawatt solar cluster that saves around 325,000 tons of carbon emissions annually.

We accomplished two significant milestones in offshore wind energy: We won an auction with bp early in the year to build a 2.9 gigawatt offshore wind farm off the east coast of Scotland. This is expected to be built from 2026/2027 and will be able to supply the equivalent of more than three million homes with wind power. It builds on our existing offshore wind partnership with bp and brings our joint project pipeline to around six gigawatts. Additionally, just a few weeks ago, we made the final investment decision to build the 960 megawatt He Dreiht offshore wind farm. This is scheduled to go into operation in 2025. 64 turbines, each with a capacity of 15 megawatts, will then generate green electricity for the equivalent of around one million households.

We are proud to say that He Dreiht is one of the flagship projects in Europe’s energy transition. That is also because we are
implementing this major project – a first in the offshore wind sector – without government subsidies. This is possible because we have already signed long-term power purchase agreements with industrial groups such as Evonik, Salzgitter, Fraport and Bosch.
These PPAs allow us to plan, and they give the companies concerned access to renewable energy that will contribute to their
own decarbonization. So they are a win-win arrangement.

Since 2010, when EnBW completed the first German offshore wind farm, we have built four such wind farms and put them into
operation. In recent years, in combination with the projects now planned, we have become an international player, recognized beyond Germany’s borders, in a technology that is highly relevant to the future of energy.

Together with the state, regional and local administrations, we have launched a pilot project in the Zollernalbkreis district to speed up the approval process for an onshore wind farm. We will apply proposals from a joint working group for the various stages of the approval process and test them for feasibility and effectiveness.

The slow pace of renewables expansion is currently a significant sticking point. With this project, we are actively addressing this issue with the involvement of policymakers and taking an important step toward accelerating the expansion of renewable energy in our home state of Baden-Württemberg. In the future, time to approval is to be used as a performance indicator for every wind energy project.

I already mentioned our fuel switch projects. In these projects, we are converting our coal-fired power plants in Heilbronn, StuttgartMünster and Altbach-Deizisau into modern gas-fired power plants that are hydrogen-ready right from the start. In concrete terms, this means that there will be no more coal-fired power generation in the Stuttgart region from as early as 2025/2026 and in Heilbronn from 2026. From 2035, the power plants are planned to run entirely on hydrogen.

An integral part of this sustainable corporate strategy is of course a sustainable financing strategy. Our climate targets across the entire value chain are now scientifically validated. This also makes good business sense. Because this much is clear: Science based targets and SBTi validation are now a compelling argument in the capital market, for retail investors, institutional investors and financial institutions alike.

We responded early to this development, among other things by issuing green bonds and including sustainability criteria in our
syndicated credit line. Our green bonds also make an important contribution on the road to decarbonization.

Since 2018, we have issued green bonds for a total of 3.5 billion euros, most recently in November 2022 with two green bond issues of 500 million euros each. The projects we finance with these bonds make an important contribution to achieving the Paris climate targets.

The complete speech can be accessed here