ČEZ Group

Based on forward-looking projections of its assets, ČEZ is forecast to continue relying on coal and gas in the long term. As a result, the company is projected to significantly exceed its total 1.5°C carbon budget between 2022 and 2037 and is not expected to reduce its emissions intensity between 2022 and 2027 in line with its 1.5°C pathway. The company needs to reduce its emissions intensity by approximately 16% per year between 2022 and 2027 to align with its 1.5°C pathway.

About 36.8% of the power generated by ČEZ in 2022 was from fossil fuels. The company has set a coal phase-out date of 2038. It plans to reduce the share of electricity it generates from coal to 25% by 2025 and to 12.5% by 2030. ČEZ is preparing for the construction of small modular reactors (SMRs) with a total capacity of over 1,000 megawatts (MW); the company plans to launch the pilot project by the end of 2032. Additionally, the company aims to install 6 gigawatts (GW) of renewables capacity by 2030, of which 1.5 GW will be completed by 2025.

ČEZ aims to reduce its scope 1 and 2 emissions intensity by 50% by 2030, 83% by 2033 and 97.3% by 2040, compared to 2019. The company also aims to reduce its scope 3 category 11 (use of sold products) emissions by 30% by 2030, 58.8% by 2033 and 90% by 2040, compared to 2019. The target for 2030 has been validated by the SBTi as consistent with a well below 2°C target pathway. The targets for 2033 and 2040 are validated by the SBTi as consistent with a 1.5°C target pathway. Additionally, ČEZ plans to phase out coal power plants by 2038.

ČEZ plans to reduce the share of electricity it generates from coal to 25% by 2025 and to 12.5% by 2030. The company is preparing for the construction of small modular reactors (SMRs) with a total capacity of over 1,000 MW. Additionally, the company aims to install 6 GW of renewables capacity by 2030, with 1.5 GW of that capacity to be established by 2025. It also intends to increase the installed capacity for electricity storage by at least 300 MW by 2030 and quadruple the charging capacity and operate at least 800 charging stations by 2025.

In 2022, 63.2% of the energy generated by ČEZ was from low-carbon sources, including nuclear sources and renewables. ČEZ has been investing in technologies such as nuclear fusion, small modular reactors (SMRs) based on high temperature fluoride salts and floating photovoltaic power plants. In 2022, the company allocated around 70% of its research and development (R&D) investment and 65% of its total CapEx to EU taxonomy-aligned and other low-carbon related activities.

ČEZ’s emissions intensity decreased between 2017 and 2022 due to a reduction in the share of coal-fired electricity in its generation mix from almost 45% in 2017 to 32% in 2022, while its share of energy generation from low-carbon sources increased from 53% in 2017 to 63% in 2022. To align with its 1.5°C pathway in 2027, the company must reduce its emissions intensity by approximately 16% per year. This requires the company to accelerate its rate of reduction by 1.2 times its historical trend.

ČEZ aims to achieve climate neutrality by 2040. The company has set up plans to scale up its low-carbon energy generation capacity and energy efficiency services, and it has prepared financial support for its transition. However, ČEZ still lacks a comprehensive stakeholder engagement strategy on climate change or emissions reduction.

The company commits to engaging in social dialogue with workers and unions. It also discloses the categories of stakeholders it engages with on a just transition, including, employee’s, trade union groups and management representatives. Furthermore, the company demonstrates ongoing social dialogue and meaningful engagement with affected stakeholders, through working groups and open dialogues in decommissioning coal stations. No evidence was found that the company undertakes low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders other than its employees in its just transition planning.

No public commitment was found in the public domain stating the company’s intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks. The company has a commitment to re- and up-skill workers and stakeholders affected by the low-carbon transition, however, it does not disclose the actions it takes towards affected stakeholders in this regard. The company does disclose the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. It does this through a policy which is aimed at promoting upskilling of stakeholders from vulnerable groups and women. However, no relevant disclosure was found of a process for identifying skills gaps for workers and affected stakeholders in the context of the transition.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. However, no evidence was found that the company has a process to identify, assess and mitigate salient human rights risks in its own operations and supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. The company does, however, have a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. However, no evidence was found of a time-bound target for paying all workers a living wage. While the company discloses the proportion of its direct workforce covered by collective bargaining agreements, no relevant disclosure was found of the company’s required working hours. The company discloses some indicators of workforce diversity, including age and gender. However, no relevant disclosure was found of additional indicators of workforce diversity for each category type. Nevertheless, the company commits to gender equality and women’s empowerment.

The company commits to protecting personal data. However, no evidence was found of a privacy statement regarding the collection, sharing and access to personal data. The company discloses its global tax strategy and has relevant disclosure on the corporate income tax paid for each relevant jurisdiction. The company does have a policy prohibiting bribery and corruption, and it includes corresponding clauses in its contracts with business relationships. Furthermore, the company has a lobbying and political engagement policy, and it specifies that it does not make political contributions. Yet, no relevant disclosure was found of the company’s expenditure on lobbying activities.