This is a necessary process

PKN Orlen is the partner of the report

– "We want to be a future-oriented company, one that transforms and develops not only in Poland, but also at the global level" - says Daniel Obajek, CEO of PKN Orlen, while presenting a part of the company's new strategy, which is achieving carbon emission neutrality by 2050.

Breakthrough strategy

– "The presented strategy of carbon emission neutrality is a breakthrough document that defines our approach to business in the coming decades" - says the President. – "The global energy transformation that is happening right in front of our eyes is a great opportunity for development for Central Europe. As the largest company in the region, we want to become even more involved in this process and we have compelling reasons to do so. In recent years, we have not only been actively developing new business areas, but we are also a leader in the consolidation of the Polish energy and fuel sector" - he emphasizes.

The reduction in CO2 emissions will be introduced in stages and will involve production processes, as well as the products themselves, manufactured by all companies within the group, including the Energa energy company. The objective for the first stage is to reduce CO2 emissions from refining assets by 20%, and in the energy sector - by 33%, by 2030. PLN 25 billion in investments

Achieving the objective will require substantial investment outlays, estimated by the company at about PLN 25 billion. They will be spent on projects related to improving energy efficiency, but also on the commissioning and use of offshore wind energy facilities, renewable energy sources, photovoltaic installations and biofuels. Hydrogen technologies will also be developed, and the alternative fuel distribution network will be expanded.

The first energy transformation on such a scale in Poland is to be financed by sustainable development bonds and green bonds issued by the group on the European capital market, as well as EU funds.

Green pressure

At a conference, during which the new strategy was announced, the colour of the company's logo was symbolically changed to green. However, there is no denying that reduction of CO2 emissions for a company operating in the fuel and energy sector will be a major challenge. However, as Michał Perlik - Executive Director for Financial Management - explains, both Orlen as well as the entire industry are left with no other choice.

– "The issue has to be analysed from many perspectives. On the one hand, we have consumers and stakeholders who expect companies to become increasingly eco-friendly. On the other hand, however, we have systematically rising prices of CO2 emission allowances. The more the energy transformation progresses, the lower the burden on the company from the emission will be" - explains Perlik.

In addition, financing for environmentally harmful projects is becoming less available. - "If we do not change our approach, we will be driven up the wall when it comes to obtaining financing for the implementation of our projects and investments" - adds the Executive Director.

Changes in credit policies

– The credit policy of banks or, in broader terms, financial institutions is actually turning green - confirmed Maciej Tarnawski, Head of the Credit Market Products Department at Santander Bank Polska. Banks analyse the possible impact of a given investment on the environment, the extent it can contribute to reducing CO2 emissions, and other such aspects.

– "It needs stressing that mere declarations of companies of their environmental friendliness are not enough to be granted a loan. Banks expect something more, such as developed strategies, specific action plans and consistency in their implementation. It has already become a standard on the American, Western European and Japanese markets, and it is also becoming more common in Poland" - says Tarnawski.

In his opinion, also investors and shareholders (e.g. of pension funds) now pay greater attention to what companies are in their portfolios - whether they are "green" or "dirty".

Rationalization of the decision-making process

– "The challenge that the companies from the fuel and energy industry face is immense" - admits Gustaw Szarek, Associate Partner at McKinsey & Company. This sector is the largest source of CO2 emissions. Limiting them requires a complete revolution, not only in organizational and production processes, but also in terms of the product itself, which is the cornerstone of this sector's business activity.