Carbon footprint

Despite the fact that the PZU Group is an insurance and financial services organization, it is aware that measures to reduce its carbon footprint are essential. Achieving climate neutrality has become one of its strategic commitments. The PZU Group is an active participant of energy transition and by 2024 it plans to fully utilize energy from renewable sources and offset emissions from own sources. Within the time horizon of the strategy, PZU and PZU Życie should become climateneutral in scope 1 and 2.

In order to monitor this commitment, the PZU Group has been measuring its direct and indirect emissions since 2018. Every year, the measurement process is improved and its scope extended. The emissions calculation is independently verified by a certified verifier.

In 2023 the PZU Group continued multidirectional measures aimed at reduction of its emissions in scope 1 and 2, among others through purchase of energy from renewable sources, installing own installations for renewable energy production (photovoltaic panels) and purchase of energy from suppliers characterized by lower emission rates.

Below are the data on the total direct and indirect emissions for the whole PZU Group and for the main insurance companies: PZU and PZU Życie. The calculations of the carbon footprint were made in accordance with the international GHG Protocol Corporate Accounting and Reporting Standard. 2018 was selected as the base year. To fully illustrate the impact of the reduction measures on the group’s total emissions, indirect emissions (Scope 2) are calculated using two methods. The market-based method more fully captures the effects of the actions taken by using emission factors specific to the electricity sellers in question and taking into account the guarantee of origin of the electricity purchased.

Total direct emissions (scope 1) in the PZU Group

In PZU, PZU Życie and Bank Pekao, the cars in the own fleet were replaced with models producing lower emissions. In 2022, PZU and PZU Życie changed the address of the head office. As a result, refrigerant-related emissions fell in 2023 by 39.0% (-416 tons y/y).

Total scope 1 emissions dropped by 14.6% relative to the base year (2018), including fuel-related emissions down 11.2%, while refrigerant leakage emissions were 66.6% lower, compared to the base year. As in the report for previous years, the calculations were made for the facilities where consumptions are measured. In the case of consumption of natural gas by PZU and PZU Życie (total), they pertain to nearly 90% of the surface of the properties used by these companies.

Emissions associated with heat dropped by 0.2% (-0.1 thousand tons y/y), mainly due to reductions in floor space and the number of properties through changes of headquarters, among other factors.

Additionally, the above trends were driven by the reduction initiatives undertaken by the Group in the area of own properties and such efforts as, for example, thermal modernizations and optimization of energy consumption through changes in heating methods. Electricity and heat consumption remained limited as operations are still remote and/or hybrid.

Total scope 2 emissions calculated using the marketbased method dropped 55.8% relative to the base year (2018), including emissions associated with supply of heat were 44.3% lower, and emissions associated with electricity dropped by 62.7 % compared to the base year. Calculations were made for facilities where consumptions are measured.

In the case of PZU and PZU Życie (total) they pertain to approx. 90% of the surface of the properties used by these companies for electricity consumption and nearly 80% for heat consumption.

Total indirect emissions (scope 2) in the PZU Group – market-based method

Location-based indirect scope 2 emissions reached They reached 107.8 thousand tons of CO2e in 2023 compared to 112.2 thousand tons in 2022, which signifies a decrease by 4.0% y/y (-4.5 thousand tons). The locationbased method does not take into account certificates of origin or differences in the emission rates of individual suppliers.

The reduction of scope 2 emissions measured with the location-based method was attributable to reduced emissions associated with the lower heat consumption (-0.1 thousand tons CO2e) and the decreased emissions related to the consumption of electricity (-4.4 thousand tons CO2e). In the case of heat energy and electricity, the decrease in emissions (and consumption) was mainly due to the optimization of energy consumption, renovations or investments made, and the reduction of floor space and the number of properties through, among other things, changes of headquarters.

Total scope 2 emissions calculated using the locationbased method dropped 31.0% relative to the base year (2018), including emissions associated with supply of heat were 44.3% lower, and emissions associated with electricity dropped – by 21.8% compared to the base year.

Total indirect emissions (scope 2) in the PZU Group – location-based method

The share of PZU and PZU Życie in the Group’s emissions of greenhouse gas (Scope 1 and 2)

Scope 3 (indirect) emissions in selected categories dropped by 21.9%, or 5.5 tons relative to the base year (2018). The biggest impact was exerted by the drop in emissions associated with energy and fuels not covered by scope 1 and 2, mostly due to the purchase of energy with certificates of origin. Changes to the fleet policy brought about a decrease in emissions associated with diesel consumption, and an increase in those associated with gasoline, however, with a negative balance, i.e., the total WTT emissions associated with the consumption of these two fuels decreased in 2023 compared to the base year.

For the calculation of emissions in accordance with the GHG Protocol standard, for fuels, electricity (consumed in Poland), emission indicators or data from the National Center for Emissions Balancing and Management were used, while for heat (consumed in Poland) the indicator of the Energy Regulatory Office was used (based on the publication “Heating Energy in Numbers 2022”). The emission indicators for electricity consumed in foreign companies for 2023 were obtained from data published by the European Environment Agency (in previous years from the International Energy Agency), while those for heat energy were obtained from the UK Government’s Department of the Environment, Food and Rural Affairs (DEFRA) database. For scope 2 emissions calculated according to the location-based method, average emission ratios for the respective countries were used.

Total other indirect emissions (scope 3) in the PZU Group

The indicators for electricity from a given supplier (market-based method) were derived from websites of energy providers (for instance, Enea, Energa, PGE, Innogy Polska, Tauron Sprzedaż, Tauron Sprzedaż GZE, Tauron Polska Energia, PKN Orlen, ENGIE Zielona Energia).

The emission indicators for energy in the scope of WTT (well to tank) (scope 3), business trips, purchased raw materials and services, waste management and GWP for refrigerants were obtained from the DEFRA database. No biogenic greenhouse gas emissions were identified.

The following data sources were used: data on fuel, electricity and heat consumption came from the invoices for the facilities where the consumption is measured (on the basis of invoices in PZU and PZU Życie; this pertained to electricity in 90% facilities, for natural gas in nearly 90% facilities and for heat in nearly 80% facilities). Consumption of raw materials, refrigerants, waste volumes and business travel was determined on the basis of internal registers. Data that are not collected from the remaining companies were marked in the table with a dash. The greenhouse gas described in the emission indicators for fuels, electricity and heat in Poland is CO2. The other indicators included CO2, CH4 and N2O emissions as well as refrigerant gases. The volume of emissions released by each company was consolidated at the PZU Group level according to the operational control criterion.

Below are presented the greenhouse gas emissions taking into account the consolidated assets and number of employees.

As a result of the actions taken to reduce emission rates, reduce energy and fuel consumption and emission rates in Poland, the intensity of scope 1 and 2 emissions using the market-based method per employee dropped from 4.79 in the base year and 2.63 in 2022 to 2.61 tons CO2e in 2023. Emissions per million zloty of consolidated assets dropped from 0.61 in the base year and 0.23 in 2022 to 0.22 tons CO2e in 2023.

Intensity of greenhouse gas emissions

PZU and PZU Życie took actions aimed at reducing scope 1 greenhouse gas emissions associated with combustion of fuels. To this end, the companies have expanded their fleet in 2023 by 43 cars, i.e., 5 electric cars and 38 hybrid cars.

In 2023, there was no tender conducted to allow for verification of hotels for “sustainable hotel” features. Nonetheless, business travel providers (airlines, hotels) and users are paying greater attention to this aspect.

Similarly, PTE PZU has a fleet of mostly hybrid-powered cars and intends to reduce fuel and paper consumption by 10% in the horizon to 2024, and also develop remote and hybrid working tools.

In line with the commitment made in the ESG Strategy, PZU and PZU Życie carried out the offset of the CO2 emissions to which they contributed in 2022. These emissions were offset by purchasing certified offset credits, CERs, made available by the UN Carbon Offset Platform. As part of offsetting the environment for emissions generated in 2022, the funds were allocated to wind power development in India. The companies purchased offset units equivalent to emissions for PZU and PZU Życie of 17,425 Mg of CO2 . PTE PZU (purchased units equivalent to 36 Mg of CO2 ) and TUW PZUW (92 Mg of CO2 ) also joined the effort. The funds from the CERs purchased by TUW PZUW have been earmarked for the development of a hydroelectric complex – hydroelectric plants on the Jordão River in Brazil. In addition to the CO2 offset made, TUW PZUW has purchased 1,040 CDUs (carbon dioxide units) from the State Forests. CDUs represent 1 ton of CO2 that will be accumulated in the forest stand and soil as a result of additional activities. The purchase of CDUs represents TUW PZUW’s contribution to mitigating the negative effects of climate change in Poland.

Total CO2 emissions (Scope 1, 2 and 3) in PZU Capital Group by emissions sources