Latvenergo – the first company in the Baltic states to receive an evaluation from the Moody’s climate target scoring system

Latvenergo is the first company in the Baltic states to publish Moody’s opinion on the climate targets defined by the company and the feasibility of achieving them. The NZ-3 score received by the Group confirms the high credibility of reaching the climate targets of the Group and its compliance with the requirements of the Paris Agreement. Latvenergo aims to achieve climate neutrality in electricity generation by 2040 through the development of new RES capacity. Moody’s started assessing the climate targets of the companies this year, and only those companies that demonstrate a real commitment to reducing climate change and GHG emissions in their operations are undergoing the assessment.

Moody’s, which has rated the creditworthiness of companies to date, has started offering a new rating this year by creating a Climate Target Rating, and Latvenergo Group is the first company in the Baltic states to publish the rating received.

Moody’s has granted an NZ-3 score on the Net Zero Assessment (NZ) scale to Latvenergo. This indicates that significant GHG emission reduction targets exist within the Group, as well as that the planned activities of Latvenergo in moving towards climate neutrality are positively assessed and comply with the objectives of the Paris Agreement. It is important to note that Moody’s ratings are only available to companies that are involved in climate change mitigation and set targets to reduce GHG emissions. Not only are the targets set assessed but also the procedure of their implementation and the management of climate aspects.

“We are proud to have the courage to undergo this assessment, and, consequently, we are assured and confident of our role in contributing to green energy and climate neutrality among Baltic energy companies. During our participation in the first assessment, the commitment of Latvenergo to the climate goals of the strategy already received the important NZ-3 score. The real work on implementing our targets is in progress – the development of new RES capacity is not just an ambition. These are solar park and wind farm projects that will contribute to the uniqueness of the generation portfolio of Latvenergo in the Baltic states in the coming years. Only we will have all the forces of nature at our disposal – water, sun and wind,” – says Guntars Baļčūns, Chief Financial Officer of Latvenergo AS and Head of the Sustainability Committee.

Investors, other business partners and the public more often choose to do business with and buy goods and services from companies that demonstrate real and measurable progress towards climate neutrality. It is, therefore, good practice for the energy sector to not only set climate targets but also demonstrate the real achievability thereof through third-party assessment.

In its Sustainability Strategy targets, Latvenergo Group is committed to reducing direct* GHG emissions by 47% (in comparison with 2021) by 2030 through the development of new RES generation capacity. Most of this will come from wind power, as well as the solar parks that are now growing rapidly, with an estimated total capacity of 2,300 MW by 2030. This is the basis for achieving climate neutrality in electricity generation in 2040, thus also helping other sectors to transition and achieve climate neutrality in 2050.

The Sustainability Strategy of Latvenergo Group was approved at the end of 2023 and complements the medium-term operational strategy with objectives and targets to be reached in environmental, social and governance sectors. A number of commitments to reaching climate neutrality comprise part of the commitments and actions defined in the Sustainability Strategy.

*Direct or scope 1 GHG emissions are emissions from sources that are owned or controlled by the company. The volume and intensity of these emissions by Latvenergo Group are influenced by several factors, i.e., the share of RES in the consumption of primary energy resources, the amount of energy produced and the operating modes of production facilities.

Moody's Net Zero Assessment