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SSE Renewables and SSEN Transmission continue to engage at a strategic level to promote the adoption of standardised measures for biodiversity quantification across the renewables sector and more broadly.
Our biodiversity net gain toolkits - which we have made open source - allow us to transparently quantify the progress we’re making to improve the natural environment on our onshore sites. This means we are building the renewables assets needed for net zero, while leaving the biodiversity at our sites in a measurably better state – tackling both the climate and nature emergencies, hand-in-hand.”
Kate Wallace Lockhart Head of Sustainability, SSE Renewables “
CASE STUDY.
SSE plc Sustainability Report 2023 83.
The next frontier: measuring marine and intertidal biodiversity While the methods for confidently enhancing the value of nature on land are well understood by SSE, measuring and monitoring marine biodiversity, either intertidal or within the ocean environment, poses different challenges and is a key area of focus for the future. As part of its efforts to connect Scotland’s remote islands to the national grid and progress vital reinforcements for future offshore renewable wind projects, SSEN Transmission is working with environmental groups to enhance the collective understanding of the wider marine environment and to recognise the potential impacts that such offshore projects may bring to the submarine environment. In doing so, SSE will be able to identify actions to protect and restore Scotland’s marine species and habitats.
An example of collaboration on marine biodiversity research is SSEN Transmission’s work with Orkney Skate Trust. SSEN Transmission is providing funding to support the Trust’s research work to survey the seabed that will be used for the proposed Orkney transmission connection. The research will collect and share invaluable data on the current condition of the seabed and the population of flapper skate. The information gathered from this partnership will provide SSE with a much deeper understanding of the marine environment and provide the facts to determine how SSE can help to preserve and enhance the unique wildlife and habitat on the seabed.
Given the complexity of the marine environment, and the extensive nature of its development ambitions, SSE Renewables is working in partnership to develop shared approaches and expand the amount of data available to developers to make informed and transparent decisions. A broad array of industry collaborations are seeking to develop knowledge and understanding of cumulative environmental impacts from offshore wind and the interaction between species affected by offshore wind farms. Research is underway into methods for better monitoring of seabirds and the development of an environmental platform collating species data from the variety of surveys being undertaken.
The core of this collaboration is being undertaken in Scotland and the UK. To support shared learning at an international level, SSE Renewables has joined the UN Global Compact’s Offshore Wind and Marine Spatial Planning Steering Group, created through the Ocean Stewardship Coalition, which runs a series of ‘sprint’ projects to quickly map existing initiatives and develop shared policy asks from offshore wind developers, academia, UN bodies and other institutions.
Finally, SSE Renewables is pursuing wider partnership opportunities with key conservation and research organisations to drive development of innovative approaches to measure marine and coastal biodiversity. This includes the adoption of artificial intelligence for species monitoring and exploring the potential for “ecological digital twins” to better understand the interaction between species and our assets.
More information on SSE’s approach to biodiversity can be found in SSE’s Annual Biodiversity Report, available at sse.com/ sustainability. The report highlights the work SSE has undertaken to protect and enhance biodiversity, contribute to biodiversity research and knowledge, and connect people with the natural world.
Protecting and restoring the natural environment 84 SSE plc Sustainability Report 2023.
Enhancing the natural environment.
SSE supports the conservation, restoration and enhancement of the natural environment; and promotes the integration of amenity, ecosystem, and biodiversity improvement into business activities.
Conserving and restoring valuable species and habitats SSE implements best practice measures to conserve, restore and enhance the UK and Ireland’s habitats and species. Where SSE’s operations interact with the natural environment, it strives to mitigate risks and works, wherever possible, to deliver biodiversity enhancement in line with its policy and legal requirements.
The strategic role of nature within the ED2 Business Plan Within SSEN Distribution’s 2023-2025 business plan, approved by Ofgem in December 2022, the role of nature has, for the first time, been identified as both creating future value for customers, and as a method of mitigating and adapting to a changed climate.
A Customer Value Proposition (CVP), is a mechanism that Ofgem allows for network expenditure, outwith the normal set of expected outputs, in the pursuit of innovative ways to create value for customers. SSEN Distribution’s proposal to establish new seagrass meadows in the seas around its licence areas, due to its exposure to the marine environment when replacing subsea electricity cables, was granted funding. This CVP seeks to understand the value of seagrass both as a method of enhancing marine biodiversity and, potentially, providing important evidence on the contribution of seagrass replanting for carbon sequestration.
A second element of the Business Plan, is the funding of nature-based solutions for carbon removal. The objective of SSEN’s plans for a nature-based solutions approach, is to tackle residual emissions at the end of its science-based targets aligned carbon abatement activity, thus demonstrating nature-based solutions as a feasible and credible method, while delivering wider environmental and social ecosystem service benefits.
This work has set in motion a significant policy shift; it not only secures funding for investment in nature for the short term, but shifts the policy dial for future price controls, laying the pathway for others to follow.
The co-existence of nature and renewable energy SSE’s portfolio of hydro-electric power stations has co-existed with the valuable ecosystems of the north of Scotland, for nearly 80 years. Decades of experience exist in fulfilling statutory obligations to ensure that Atlantic salmon can follow their migratory path (see case study on the journey of the smolts).
This includes the continued operation of adult fish counters at key strategic locations with fish count records dating back over 60 years in some instances. This information is invaluable in informing wider conservation strategies for Atlantic salmon and SSE Renewables have longstanding commitments to sharing this with conservation agencies and fisheries boards. In addition, SSE Renewables currently commit to extensive and targeted management interventions to enable juvenile salmon (smolts) to migrate safely to sea each year (see case study on page 83). A similar approach is in place to enable upstream migration of adults.
The development of onshore wind in Scotland, often in places where peat dominates the landscape, has led to an obligation on developers to both protect and enhance peatland habitats. Through sensitive site design and long-term habitat management plan commitments, SSE Renewables has extensive expertise in peatland restoration and management practices. For example, SSE Renewables’ Strathy South wind farm commits to an ambitious forest to bog restoration scheme involving the removal of 1,132ha of commercial forestry, considered to be of very low biodiversity value, and returning this to native peatland habitat. The project.
SSE plc Sustainability Report 2023 85 has also committed to a further 468ha of offsite open moorland bog restoration.
Managing habitats during Transmission upgrades SSEN Transmission has introduced an ‘Irreplaceable Habitats’ policy, which puts stringent processes in place to prioritise the avoidance of routing transmission infrastructure through ancient woodland, veteran trees and peatland wherever possible.
In circumstances where impacts are unavoidable due to the extent of ancient woodland coverage in its network area, and where network resilience could potentially be put at risk, SSEN Transmission set out comprehensive and site-specific irreplaceable habitats plans to minimise any potential impacts wherever possible. Examples include exploring micro-siting, reducing standard operational corridors and restorative action.
In the case of ancient woodland specifically, SSEN Transmission is committed to funding appropriate restoration projects to enhance the condition of existing ancient woodland sites (for example, by removing invasive non-native rhododendron) or where tree removal is unavoidable (historically, this tends to affect commercial plantation), replacing removed trees with native broadleaves to enhance woodland ecosystems.
For example, in Scotland’s rainforest in Argyll, SSEN Transmission is working with the Argyll Coast and Countryside Trust (ACT) to deliver 30 hectares of new woodland. The business also provided funding to ACT for a woodland officer to help develop plans for the planting activities. Over the next five years, SSEN Transmission will need to plant approximately 650 hectares of woodland in this area.
Supporting communities to improve wellbeing and enhance nature SSE works to raise awareness and understanding of biodiversity and conservation, encouraging both employees and communities to connect with the natural environment around them. The importance of connecting with nature and having access to outdoor spaces remains essential for people’s physical and mental wellbeing.
Many of SSE’s assets provide recreational amenity, for example Galway Wind Park in Ireland has a series of recreational trails open to the public called the Galway Wind Way; SSEN Distribution repurposed excess topsoil from its submarine cable reinforcement project at Loch Broom to support four wildflower meadow projects in Ullapool; and SSE Thermal’s dedicated liaison manager at its Aldbrough site has been working alongside the local community to deliver a number of biodiversity improvements to a local woodland, St Michaels Woodland, by introducing bird nesting boxes, wildflower planting and other infrastructure improvements to promote community use.
Using innovative techniques to improve salmon management.
SSE Renewables is responsible for mitigating the impact of hydropower on salmon in water catchments in the north of Scotland, which can require trapping young salmon (called smolts) in spring during their seaward migration and transporting them downstream, to allow safe passage past dams.
In 2022, to improve the number of smolts reaching the sea, SSE Renewables took over management of the Tirry trapping site on the Shin water catchment area. SSE Renewables’ dedicated hydro environment team, which includes a full-time fisheries biologist, has implemented several innovative changes, including the use of a motorised trap, a novel automatic release cage to preserve the nocturnal migration of smolts, and rock-filled bags to direct river flow and smolts into the trap. Total capture increased to 4,000 smolts in 2022 and 4,200 in 2023, almost four-times higher than the 10 year average capture rate.
Improving the number of smolts reaching the sea increases the likelihood of adult returns and has contributed towards increasing numbers in the catchment area in recent years, which is a positive trend at a time when the abundance of wild salmon is at an all-time low across Scotland.
Full detail of the project can be found in the SSE Renewables Sustainability Report 2023, which will be published later in the year at sserenewables.com/sustainability.
Sensitive habitat conservation during network upgrades.
In 2022/23, SSEN Distribution replaced the 11kv subsea cable between the isles of Mull and Coll. Through stakeholder consultation it was identified that the cable route would run through unique machair habitat. This habitat is a low-lying grassy plain that supports plant species such as red clover, bird’s-foot trefoil, yarrow and daisy, and rarer species such as lesser-butterfly orchid, Hebridean spotted orchid and marsh orchid.
Working with NatureScot, Scotland’s nature agency, SSEN Distribution identified mitigation actions that would minimise the impact of the cable replacement to this unique habitat. Where the machair habitat was found to be sensitive (due to shallow root systems), coir matting, additional reseeding and temporary fencing were used to support re-establishment of the habitat. In addition, minimal trench width excavation was used, lifting as little of the machair as possible, for as minimal a time as possible. This ensured there was no detriment to the root system, allowing the machair to rapidly re-establish.
The local stakeholders and NatureScot were satisfied with the retention efforts, with NatureScot planning to showcase SSEN Distribution’s efforts as best practice in machair preservation during construction. In 2023/24, SSEN Distribution will continue to monitor the integrity of the machair.
PARTNERING IN ACTION.
INNOVATION IN ACTION
Protecting and restoring the natural environment 86 SSE plc Sustainability Report 2023.
Responsible consumption and production.
SSE relies on natural resources and recognises the impacts of resource extraction on the natural environment. SSE supports the sustainable use of land and water resources and embraces circular economy principles alongside the waste hierarchy to seek opportunities to mitigate these impacts.
Resource efficiency SSE is working towards more sustainable patterns of resource consumption by reducing reliance on non-renewable and single use products. As a result of SSE’s rationalisation of its recycling and resource recovery services as well as working with suppliers on circular economy approaches, SSE is driving improvements in its recycling and diversion from landfill performance.
SSE has waste management controls within each of its businesses and seeks to follow the waste hierarchy to prevent, reduce, reuse and recycle its waste. It provides recycling facilities at its key offices and operational sites and adheres to the relevant regulatory requirements for waste management at its different sites and locations.
SSE’s target for 2022/23 was to divert 85% of waste by tonnage from landfill and recycle 40% of waste by tonnage. It exceeded these targets, with 65% of SSE’s total waste being recycled/composted and only 5% being sent to landfill. The proportion of waste sent to landfill more than halved compared to the previous year. This was due to a higher proportion of waste being processed as ‘energy from waste’ and an increase in waste recycled. Recycled waste increased as a result of improved recycling processes implemented at sites, as well as the inclusion of additional waste recycling data, such as metals.
Over 2023/24, SSE expects to further broaden the coverage of waste performance data to include large capital projects and minor works. SSE’s 2023/24 performance target is to divert 95% of waste by tonnage from landfill and recycle 50% of waste by tonnage. It is expected that the planned scope expansion of waste data in 2023/24 will influence performance, in particular recycled waste data. SSE will continue to review its waste target to ensure that it remains stretching.
SSE is also introducing the principles of circularity into its business activities and is collaborating with stakeholders to create solutions for industry-wide challenges and support circular supply chains.
Creating the Coalition for Wind Industry Circularity (CWIC)
In March 2023, SSE Renewables with partners the University of Strathclyde, National Manufacturing Institute Scotland and Renewable Parts Ltd, launched the Coalition for Wind Industry Circularity (CWIC). The creation of CWIC followed the signing of a Memorandum of Understanding in July 2022 with Renewable Parts and the University of Strathclyde which identified three priorities for collaboration: 1) Increase the circularity of in-service parts on onshore wind farms; 2) Establish an end-of-life strategy for onshore wind farm parts; and 3) Deliver a UK Wind Circular Economy Sector Deal to maximise the environmental and socio-economic opportunities to ensure UK leadership on circularity.
CWIC seeks to bring together the UK wind sector to create a supply chain for the refurbishment and reuse of wind turbine components within the UK. Analysis, commissioned by CWIC undertaken by BVG Associates, modelled the economic value associated with this proposal, with the assessment identifying a potential European market of £8.9bn from 2025-2035 and creating 20,000 full-time equivalent jobs based on demand for just 10 wind turbine component parts. More than 25 organisations have submitted an expression of interest to join CWIC, including some of the world’s largest global wind developers, government institutions, innovation bodies and SMEs.
Beyond component parts, SSE Renewables is also focusing on progressing solutions for large-scale and commercially viable options for the reuse, recycling and remanufacture of end-of life turbine blades. SSE Renewables remains active in SusWIND, with progress made on the development of a life cycle analysis toolkit to enable owners of wind turbines to make informed sustainable decisions when turbine blades must be decommissioned.
The Company is a pilot partner of ReWind, a tool produced by DNV which profiles which materials are contained in wind turbines, how they can be disposed of in the best possible way, what can be recycled and what the recycling method would be. It is intended that SSE Renewables will use this tool to quickly assess turbine recyclability percentage and options for end-of-life planning and sustainable decommissioning. Digital solutions such as ReWind will aid the move towards increased recycling rates for decommissioned wind assets.
PARTNERING IN ACTION.
SSE plc Sustainability Report 2023 87.
Reusing materials to support birdlife at Creag Riabhach.
In 2022, SSEN Transmission continued its work to expand the transmission network in the north of Scotland. Several new overhead lines and substations to facilitate new renewable generation were under construction and some wooden boxes used to store equipment were identified as having reuse potential.
An opportunity was identified to reuse the wood and reduce waste by using it to build nest boxes for birds. Nesting sites for birds are in decline in many areas in Scotland. Discussions with Forestry and Land Scotland and the Highland Raptor Study Group identified that the wooden boxes could be used in the local area as well as further afield. In total, 36 boxes were built for a variety of birds, including barn owls, tawny owls and kestrels. The boxes will help support raptor populations, particularly kestrels which have been showing recent steep declines in numbers. The initiative has already proven to be a success, with two tawny owl chicks hatching in one of the repurposed boxes near Nethy Bridge in the Cairngorms which were recently ringed by Highland Raptor Study Group for monitoring purposes.
Managing water use Water plays a significant role in SSE’s operations, being used in the energy production process including as a coolant in power stations and a source for power generation in hydroelectric generators. SSE also uses water as an amenity in its buildings.
In 2022/23, total water abstracted by SSE fell to 23,354 million m3 from 23,896 million m3 from the previous year. This was largely due to a reduction in water passing through SSE’s hydro generation plant as a result of lower levels of rainfall compared to the previous year. The vast majority (97%) of water abstracted in 2022/23 was used in SSE’s hydro generation operations. This water is technically recorded as abstracted, but it passes through turbines to generate electricity and is returned to the environment almost immediately, and therefore has minimal environmental impact.
Total water consumed increased significantly over this period, by over 70%. This was due to increased output from thermal generation overall, as well as a proportional increase in the output from thermal power plant with cooling towers which have higher evaporative losses of water than once through (direct) cooling systems. SSE has a water efficiency and saving programme in its non-operational offices, data centres and depots, and also runs a behavioural change campaign in its non-operational buildings to encourage water savings at work and at home. In 2017/18 a target was launched as part of the programme, to reduce water consumption every year by 2.5%. Total SSE non-operational buildings water use in 2022/23 was 27,859 million m3, up from 22,875 million m3 the previous year as a result of a return to the offices after the lockdowns associated with the COVID pandemic. SSE provides more detail on water risk management and performance in its annual CDP Water Programme response. SSE received a ‘B’ rating for its 2022 submission, which is publicly available at sse.com/sustainability.
Managing air emissions In 2022/23, SSE’s thermal generation sites emitted 3,870 tonnes of nitrogen oxides (NOx), compared 4,573 tonnes the previous year, a reduction of around 15%. Emissions of sulphur dioxide (SO2) reduced to 1,336 tonnes from 3,021 tonnes the previous year. In addition, particulate emissions (PM10) fell to 116 from 277 tonnes in 2020/21. The falling trend across these key air emission sources reflects the reduced demand for oil-fuelled peaking plant in Ireland that occurred the previous year as a result of the need to balance the grid. Finally, mercury emissions to air increased to 10.6kg from 2.2kg in 2021/22 as a result of an increased level of test running on back-up fuel oil that was required during the year, as dictated by Transmission Operator on the island of Ireland.
CASE STUDY
Governance and accountability pages 90 to 91.
Sustainability-linked Executive remuneration page 92.
Managing sustainability-related risks page 93 88 SSE plc Sustainability Report 2023.
Governance report.
SSE has a well-established framework through which sustainability-related issues are governed, ensuring that social and environmental risks and opportunities are effectively managed.
SSE plc Sustainability Report 2023 89
Data and performance 90 SSE plc Sustainability Report 2023.
Governance and accountability.
The structures governing sustainability within SSE are designed to deliver clear lines of accountability and ensure the alignment of strategic objectives with social and environmental value.
Structured governance pathways Responsibility for the most material sustainable impacts lie at the highest levels of the organisation with sustainability integrated into the responsibilities of the Board, the Chair, the Chief Executive and the Group Executive Committee. With the quantity and diversity of ESG issues of interest to stakeholders becoming ever more sophisticated, SSE regularly reviews the effectiveness of the governance arrangements which support its most material sustainability policies, practices and performance.
The Board and its sub-committees At the highest level of the organisation, the Board sets SSE’s vision and purpose. The Group strategy that seeks to fulfil that vision and purpose is also set by the Board and is reviewed across the year through an iterative programme of work. Sustainability is articulated within the description of SSE’s strategy given the close alignment between its long-term strategic objectives and the pursuit of net zero.
Within its supporting plan of work, and on an annual basis, the Board further reviews and approves SSE’s priorities relating to its principal sustainability impacts, of which, climate change is defined as the most material of all. This is in addition to a range of sustainability and climate-related issues which may be brought in response to the agreed sustainability priorities, or internal or external developments.
In setting strategy and ensuring an effective framework for its delivery, the Board considers both the spirit and letter of its duties under Section 172 of the Companies Act, including the long-term consequences of decision-making and promoting the success of the Company for the benefit of all stakeholders. A Board-approved framework for engaging with SSE’s key, defined stakeholder groups, sets expectations surrounding the understanding and incorporation of stakeholder views within business plans and objectives. Re-enforcing the approach to ethical business conduct and culture, the Board also owns SSE’s Group Policy suite which applies to all employees, and during 2022/23, it reviewed and approved specific policy statements on human rights, the environment, climate change and sustainability. While the purpose of these policies is to guide the behaviours, actions and decisions of SSE employees and their senior leaders, they are available for stakeholders to review on sse.com/ sustainability.
The Board is advised on matters relating to safety, sustainability, health and the environment by the Safety, Sustainability, Health and Environment Advisory Committee (SSHEAC), which continues to be chaired by an independent nonExecutive Director. Its membership comprises four non-Executive Directors, the Chair of the Board, the Chief Commercial Officer, the Chief Sustainability Officer and three senior leaders from across the SSE Group. The SSHEAC has oversight of the annual SSE Sustainability Report and across 2022/23, it enhanced its oversight of ESG matters through deep dives on SSE’s external benchmark performance and an ESG gap analysis.
The Remuneration Committee is also chaired by an independent non-Executive Director of the Board. It prepares SSE’s policy on executive remuneration which remains subject to consideration and approval of shareholders. Through this policy, the approach to performancebased pay assesses Executive Directors’ progress against SSE’s 2030 Goals, which are aligned to the UN’s SDGs. The Remuneration Committee undertook its three-yearly review of SSE’s Directors’ Remuneration Policy in 2021/22, and as part of that, the 2022/23 Annual Incentive Plan included a new measure aligned to ESG performance, with progress against the 2030 Goals now incentivised in the longer-term Performance Share Plan. Finally, the Audit Committee of the.
Good quality governance provides more than a key ‘check and balance’ on SSE’s social and environmental policies, practices and performance – it can provide support to the entire organisation as it seeks to pursue shared value for all its stakeholders.”
Helen Mahy CBE Chair, SSHEAC “
SSE plc Sustainability Report 2023 91.
The Group Risk Committee is responsible for managing the processes to assess and monitor the Group’s Principal Risks and provides oversight to identified Business Unit risks. The Human Rights Steering Group, responsible for the production of the annual Human Rights and Modern Slavery Statement, and the action plans that fall underneath, reports to the Group Risk Committee. The Group Risk Committee also has oversight of the internal process to identify and quantify the most material climate-related risks and opportunities, which forms the core of the TCFD report in the Annual Report.
The Group Safety Health and Environment Committee (SHEC) is responsible for the careful management of safety, health and environment matters across the SSE Group. The SHEC also considers operational sustainabilty issues, including climate adaptation anbd overall ESG performance.
Chief Sustainability Officer The role of Chief Sustainability Officer (CSO) was established in 2019 and reports directly to the Chief Executive. The role is responsible for advising the Board and its Committees, the GEC and individual Business Units on sustainability issues and strategy.
To further integrate sustainability within the governance structures of SSE, the CSO is a member of the Board-level SSHEAC and three of the six Group-level sub-Committees of the GEC: the Group Risk Committee; the Group Safety, Health and Environment Committee; and the Group Large Capital Projects Committee. The CSO is also a non-Executive Director of the SSEN Transmission Board.
Board has responsibilities relating to the integrity of financial reporting and the effectiveness of risk management, and oversees SSE’s approach to its Task Force on Climate-Related Financial Disclosures (TCFD) report within SSE’s Annual Report.
The Group Executive Committee and its sub-Committees SSE’s Group Executive Committee (GEC) is responsible for implementing strategy, as approved by the Board, including Group Policies and the management of risks. The GEC supports identification of SSE’s most material social, environmental, and economic impacts and the delivery of Group sustainability strategy including in relation to climate change. The Chief Executive chairs the GEC and as Executive Director with responsibility for sustainability, agrees the annual objectives and priorities for the Chief Sustainability Officer.
Governance report Sustainability-linked Executive remuneration.
SSE’s approach to Executive remuneration reflects the role of sustainability and climate-related considerations within SSE’s purpose and strategy, with sustainabilitylinked metrics and targets forming an element of performance-related pay.
The framework of SSE’s 2030 Goals has been used since 2019 to assess performance, which was linked to the performance based Annual Incentive Plan until 2021/22. The updated Directors’ Remuneration Policy, approved by shareholders at the 2022 AGM, has seen two important changes: