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Greenalia, the green company

FY23 Interactive Sustainability Report

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Letter from our president

José María Castellano Ríos, Greenalia's President
José María
Castellano Ríos
Greenalia's President

Closing 2023 with the warmest year on record is a major indicator of the way we must go. We need to step on the accelerator to achieve a paradigm shift in our relationship with the planet. Global warming is an increasingly tangible reality, as are its consequences. Increased natural disasters, water stress, rising sea levels...are just some of the growing and more frequent effects of the Earth’s delicate health. Consequences that are particularly affecting the most vulnerable collectives and developing countries, which evidences the need to accelerate the implementation of new business models that allow these increasingly intense phenomena to be reversed.

The progressive abandonment of fossil fuels and their replacement with renewable raw materials is essential to protect ecosystems and to be able to leave a better future for future generations. Not to do so would be an enormous irresponsibility. Addressing it in an agile, inclusive and fair way is a great challenge, ambitious, but attainable.

Therefore, in line with what was agreed at COP-28 and as members of the UN Global Compact, at Greenalia we continue our commitment as relevant actors of change. We are aware of the importance of doing our bit to achieve the global goal of tripling renewable energy by 2030, but also of advancing people's well-being.

We understand that this is the way forward, because one of the biggest enemies of the climate lies in CO2 emissions. The promotion of renewable energies, based on their different technologies, is an essential pillar to achieve this. This is why at Greenalia we are committed to developing our projects in the areas with the best resources, always taking into account optimal integration with the environment and protecting biodiversity. We also do this by introducing new procedures, backed by technology and science, that make it possible to reduce our CO2 emissions as much as possible.

Doing so in harmony with nature, in dialogue with local environments and with the maximum consensus is key for the Greenalia team, which has sustainability and its pillars as the cross-cutting axes of all its activity.

Letter from our CEO

Manuel García Pardo, Greenalia's CEO
Manuel
García Pardo
Greenalia's CEO

Since our foundation, at Greenalia we have positioned ourselves in the search for innovative solutions to generate energy in an environmentally friendly way and to take an active part in the fight against climate change. This has led us to diversify our business portfolio, developing renewable technology projects, which are now mature: onshore wind, solar photovoltaic and biomass, but we are also committed to innovation, developing initiatives in offshore wind, storage and hydrogen.

In line with our nonconformity, not only have we expanded our pipeline in a market as important as the American one, but we are also continuing to advance pioneering initiatives such as the capture of biogenic CO2 and its use as raw material for new uses, in a clear commitment to the circular economy. We also do so with the aim of generating a positive impact on the industry. For this reason, we strengthen our projects with the firm of PPAs, through which solutions are offered to the industry to be more competitive, efficient and environmentally friendly.

A growth that we are experiencing in parallel with the daily management of our assets in operation, which in 2023 exported a total of 558,836 MWh to the grid, 11% more energy than the previous year. This has allowed savings of more than 237,300 tons of CO2 avoided to the atmosphere, with the consequent benefit for the planet.

In a highly competitive and uncertain global environment, at Greenalia we are taking steps to implement new renewable developments. A highly complex path, with obstacles to overcome, that we must follow together with society, in an open dialogue. We do this with the certainty that this is the path to a healthier and better planet for all the living beings that inhabit it.

This is how we understand it at Greenalia, where our commitment to the protection of the planet and people, the use of the best governance standards and the impact on the prosperous development of society is unequivocal.

The introduction of higher reporting and compliance standards places us at a high level of self-demand in the areas of Governance, Environment and Social, and with a corporate culture at the level of the largest multinationals. This is demonstrated by our ranking in independent ratings, which highlight our strong management in terms of sustainability.

A commitment that we are very proud of, as we are of our dialogue with all the local communities where we operate and with which we maintain a relationship of cordial neighborhood.

We will continue working to develop the best projects, competitively and efficiently, but, above all, with the focus on all of them having a positive impact on the planet and on society.

About Greenalia
01

About Greenalia

Monte Tourado Wind Farm (10.4MW)

01.1

Milestones and key figures for 2023

Milestones

More MWh exported to grid

558.836 MWh exported to grid +11% than in 2022

Exclusively renewable production

100% renewable energy production sales

Second Sustainability Rating

Low Risk Rating - Sustainalytics

Over 3GW in Spain and US

Under construction and Advanced Development in different Wind, Solar, Bess technologies

One & Only multi-technology company

Onshore Wind, Offshore Wind, Solar, Bess, Biomass, Hydrogen, E-fuels

Pipeline consolidation

Start of construction of 415MW in Spain of Wind & Solar and 1GW in US of Solar, Wind, and Bess

Start of biogenic CO2 capture project

600,000tm of biogenic CO2 available at our biomass plant for synthetic fuel production

Sustainable ambition and vision

Development of 2nd Sustainability Plan (2024 - 2028)

Strategic alliances

Adherence to the Spanish Business and Biodiversity Initiative (IEEB) for biodiversity integration in business management

Key Figures

governance

0 M€

Revenue

0 M€

EBITDA

0

Strategic Alliances in sustainability matters
planet

0

tons of CO2 avoided
+10% vs 2022

- 0 %

reduction in water consumption per MWh generated vs 2022

- 0 %

reduction in direct emissions in tCO2-eq/MWh generated vs 2022
people

0 %

of the Green Team has received performance evaluation

+ 0 %

increase in training hours per employee

0 %

Equality Plan objectives achieved
Prosperity

+ 0 M€

invested in local environments

+ 0

indirectly generated local jobs

0

social projects (135 thousand € invested)

Surroundings Alto da Croa Wind Farm (7.3 MW)

01.2

Business lines

  • Onshore Wind Onshore Wind
  • Offshore Wind Offshore Wind
  • Photovoltaic Photovoltaic
  • Biomass Biomass
  • Storage Storage
  • Green Hydrogen Green Hydrogen
  • E-Fuel E-Fuel
01.3

Our operating assets

Curtis-Teixeiro Biomass Plant
Miñón Wind Farm
Ourol Wind Farm
Monte Tourado Wind Farm
Alto Da Croa I Wind Farm
Alto Da Croa II Wind Farm

Curtis-Teixeiro Biomass Plant

Investment

135M€

Installed capacity

50MW

Miñón Wind Farm

Investment

28M€

Installed capacity

24MW

Ourol Wind Farm

Investment

26M€

Installed capacity

22.5MW

Monte Tourado Wind Farm

Investment

8M€

Installed capacity

10.4MW

Alto Da Croa I Wind Farm

Investment

5.5M€

Installed capacity

7.3MW

Alto Da Croa II Wind Farm

Investment

8M€

Installed capacity

10.4MW

01.4

Business model

Our business model is based on sustainability, addressing the challenge of climate change mitigation through renewable energy production. We work towards a common goal of achieving an energy model based exclusively on clean energy with a commitment to environmental and social sensitivity in all our projects.

This Develop&Own model includes the largest forest biomass generation plant in Southern Europe and five operational wind farms. These lines of business have solidified the group's vertical integration strategy. We also rotate less strategic assets to obtain resources for driving new projects.

At Greenalia, as an independent energy producer, we are active in the following stages of the process:

  • A —
    Promotion and Development

    Development

    +

    Financing

    +

    Construction

    • 01

      Search for viable projects

    • 02

      Achievement of all milestones until Ready to build

    • 03

      Structuring of green, efficient, and non-recourse financing

    • 04

      Supervision services during project construction

  • B —
    Energy

    Production

    Sale of energy in its IPP modality through:

    • 01

      Sale to market

    • 02

      Participation in renewable energy auctions

    • 03

      Signing of PPA (Power Purchase Agreement)

  • C —
    Services

    Operation and maintenance

    +

    Asset management

    • 01

      O&M supervision service

    • 02

      Monitoring activities of our assets (Asset Management)

01.5

Project portfolio 2023

Total

0GW

in 5 Technologies

Spain

0 MW

Photovoltaic

0 MW

Biomass

0 MW

Onshore wind

0 MW

Offshore wind

United States

0 MW

Photovoltaic

0 MW

Onshore wind

0 MW

(514 MWh)

Storage
01.6

Technological innovation

We continue to invest in innovation and technology diversification with the development of renewable projects.

Green Hydrogen

We advance in the development of a 6th technology with the generation of green hydrogen.

Water
Water

Water consists of two molecules of hydrogen and one of oxygen, hence H2O

arrow
Renewable Energy
Renewable Energy

Through renewable energies, electricity is generated which is later used in the electrolysis process

arrow
Electrolysis
Electrolysis

Through this process, the molecular components of water are separated, obtaining hydrogen and releasing oxygen

arrow
Storage
Storage

Storage capacity of the energy source, used in periods of low production or transported to regions with higher energy demand

arrow
Uses of Green Hydrogen
Uses of Green Hydrogen

In addition to being a direct energy source, it can be refined to become sustainable fuel for automotive and aviation, among other uses

CO2 Capture and E-Fuels Production

We initiate a project to capture biogenic CO2 from our biomass plant.

CO<sub>2</sub> Capture
CO2 Capture

High availability of biogenic CO2 at the Curtis-Teixero biomass plant

arrow
Cooling
Cooling

The gas emitted by the chimney is cooled to room temperature

arrow
Solvent
Solvent

The absorption tower, filled with solvent, causes CO2 particles to adhere to it, separating it from the rest of the gases

arrow
Heating
Heating

CO2 is separated from the solvent through heat, provided by a high-temperature steam stream. The solvent is recirculated back to the absorption tower

arrow
Purification
Purification

CO2, now isolated from the other gases, is purified to remove any residue it may contain

Curtis Biomass Plant - Teixeiro (50 MW)

01.7

Financial excellence

The application of good financial practices is an extension of our commitment to sustainability. Strict compliance with tax responsibilities is one of our fundamental principles, inherent to our values and our philosophy of creating value.

Turnover
in M€

2022
95.1
2023
95.9

EBITDA
in M€

2022
64.9
2023
67.9

The year 2023 has been a successful year for Greenalia, we have increased our EBITDA by 4.3%

Recurrent, predictable, and stable long-term incomes.

Recurrent, predictable, and stable long-term incomes.

High returns, focused on generating EBITDA.

High returns, focused on generating EBITDA.

Efficient financial structures, and non-recourse.

Efficient financial structures, and non-recourse.

Sustainability model
02

Sustainability model

Operational team in the surroundings of Greenalia Wind Farm

Sustainability is part of Greenalia's DNA. Our vision of sustainability is based on values intrinsic to our business, with two fundamental principles: listening to all our stakeholders and developing specific plans and objectives that allow us to measure our impact and our progress. Evidence of this is our materiality analysis and the objectives set out in our sustainability plans.

02.1

Double materiality analysis

The materiality analysis allows us to identify the most relevant issues for our stakeholders, in order to develop concrete plans and objectives that allow us to move forward in creating value, measuring our impact and our progress.

We identify material issues according to the materiality of GRI's impact, in addition to following the dual materiality approach proposed by the ESRS (EU Sustainability Reporting Standards) developed by EFRAG, to consider the financial impact of sustainability on our company.

Impact materiality
Financial materiality

Double Materiality Matrix

Impact materiality

4

7

15

8

11

3

16

14

12

13

10

9

2

6

1

5

Financial materiality

Impact materiality

4

8

7

15

16

11

3

14

12

13

9

10

2

1

6

5

Financial materiality

This matrix has been carried out through more than 120 surveys to:

External stakeholders

External stakeholders

Internal Stakeholders

Internal Stakeholders

Financial surveys to the management of Greenalia

Financial surveys to the management of Greenalia

Operational team in the surroundings of Greenalia Wind Farm

02.2

Sustainability plan

Establishing goals, objectives and indicators is key to measuring our performance and developing actions and measures in accordance with the organization's strategy and the most demanding sustainability standards and norms.

After completing our first sustainability plan in 2023, we have taken the following steps to establish clear objectives for the new 2024-2028 Sustainability Plan.

Analysis

We analyzed the results obtained from the previous Sustainability Plan, the compliance with these results (85%) and the actions carried out considering the perspective of growth and impact of Greenalia.

Diagnosis

We review the best practices and the biggest challenges in the sector according to the current business model. We listen to our stakeholders through meetings and forums. We establish potential objectives, actions and indicators to respond to these challenges and present a sustainability model that guarantees the forefront of our actions.

Prioritization

We prioritize objectives and actions that are aligned with our business model and our future growth prospects. We listen to all our stakeholders to ensure that prioritisations are aligned with market expectations and concerns.

Elaboration

We designed a new sustainability plan with 20 new objectives divided into 12 axes and 4 pillars. This plan presents a system of continuous execution and evaluation in which actions and responsibilities are developed in order to achieve the established objectives.

Governance
03

Governance

Greenalia’s Headquarters

03.1

Governing bodies

General Shareholders Meeting

Company capital structure

94%
Smarttia SLU

6%
Alazady España S.L.

Board of Directors

José María Castellano, Non-Executive Chairman
José María Castellano
Non-Executive Chairman
Manuel García Pardo, CEO
Manuel García Pardo
CEO
Pablo Castellano, Dominical Counselor
Pablo Castellano
Dominical Counselor
Antonio Couceiro, Independent Counselor
Antonio Couceiro
Independent Counselor
Antonio Fernández-Montells, Executive Counselor
Antonio Fernández-Montells
Executive Counselor
Beatriz Mato, Executive Counselor
Beatriz Mato
Executive Counselor
Laura Luaces, Non-Council Vice Secretary
Laura Luaces
Non-Council Vice Secretary

Audit Committee

José María Castellano, Secretary
José María Castellano
Secretary
Norcorporate, S.L., Represented by Mr. Antonio Couceiro, President
Norcorporate, S.L.
Represented by Mr. Antonio Couceiro, President

Remuneration and Appointment Committee

José María Castellano, Secretary
José María Castellano
Secretary
Norcorporate, S.L., Represented by Mr. Antonio Couceiro, President
Norcorporate, S.L.
Represented by Mr. Antonio Couceiro, President

Greenalia’s Headquarters

03.2

Ethics and integrity

Our natural inclination to be a company committed to best practices and exceed the strictest international standards, leads the organization to have specific responsibilities and processes that allow us to achieve sustainable corporate management based on ethical principles, correct risk, and safety management of interest groups.

The centerpiece is our Regulatory Compliance Program (RCP).

Regulatory Compliance Program

RCP

03.3

Risk management

The Risk Management System establishes Greenalia's risk management and control framework. This tool is aligned with the best international practices and standards in the field of Integral Risk Management (ISO 31000, COSO, Global Risk Report, etc.). It has a policy and manual.

The purpose of this system is to provide reasonable security in achieving the objectives established by the company in response to the different challenges it faces, providing all stakeholders with an adequate level of guarantee to ensure the protection of the value generated. In addition to ensuring the proper management of the identified risks, in accordance with the processes established in the Risk Management System Manual.

Risks and Controls

Probability

R-59

R-37

R-21

R-32

R-66

Impact

Probability

R-59

R-37

R-21

R-66

R-32

Impact

Planet
04

Planet

Surroundings Alto da Croa Wind Farm

04.1

Environmental management

The conservation of the environment corresponds to one of the main objectives of Greenalia. From the direct impact on the mitigation of climate change and the respectful use of natural resources and waste presented by our business model, we promote the protection of the planet throughout all our activities and lines of business.

Our Green Book includes all specific policies on environmental management. In addition, we have strict commitments and certifications that guarantee our performance in terms of environmental management.

Specific policies
Environmental PolicyBiodiversity PolicyClimate Action PolicyCircular Economy PolicyWater Policy
Environmental PolicyBiodiversity PolicyClimate Action PolicyCircular Economy PolicyWater Policy
Environmental PolicyBiodiversity PolicyClimate Action PolicyCircular Economy PolicyWater Policy
Commitments and certifications
  • A —
    Biomass and forest management

    • 01

      Guarantee of the circular economy principle

    • 02

      100% of biomass certified by SURE

    • 03

      Compliance with EU directive 2018/2001 REDII

  • B —
    Biomass plant

    • 01

      BAT for biomass installations

    • 02

      ISO 14001 certification

    • 03

      Optimization objectives

  • C —
    Wind farms and evacuation lines

    • 01

      1,112 hours of environmental monitoring

    • 02

      Environmental monitoring based on PVAs and DIAs

04.2

Biodiversity

As established in our Environmental Policy, we are committed to promoting biodiversity and environmental conservation in the areas where we operate.

We aim to improve methods for measuring our dependencies and impacts on biodiversity, moving towards a model with a net positive impact.

impacts and alliances
80% land restored after construction
0 presence of endangered species in our assets
IEEB Joining the Spanish Business and Biodiversity Initiative
Protection programs

We continue to monitor the conservation status of the specimens of species surrounding our wind farms and evacuation lines:

Flora programs
Dryopteris guanchica

Dryopteris guanchica

Listed as Vulnerable and of least concern, it has been protected and recovered through transplants and reproduction in PE Miñón and PE Alto da Croa II.

Centaurea ultreiae

Centaurea ultreiae

Continuation of the Centaurea Ultreiae Silva-Pando conservation program in Monte Castelo, with an investment of 200,000€.

Bryophytes

Bryophytes

Evaluation of the presence of Sphagnum pylaesii Brid moss in areas of our planned parks in A Coruña and Lugo.

Wildlife programs
Amphibians and reptiles

Amphibians and reptiles

Development of sampling and mapping of areas of special interest to amphibians and reptiles in the Friol, Monte do Cordal and Carballal wind farms.

Wolf

Wolf

Monitoring wolf populations in O Cerqueiral, Campelo, Bustelo, Monte Toural, Friol and Monte do Cordal wind farms.

Chiroptera

Chiroptera

Characterization studies of chiropterans using automatic ultrasound recorders at a height of more than 40 meters in the areas of our projects in progress.

Surroundings Alto da Croa Wind Farm (7.3 MW)

04.3

Circular economy

At Greenalia, the continuous reduction of the consumption of materials and raw materials is promoted through the use of innovative technologies to improve the measurement of indicators based on circular economy principles.

The main methods for improving efficiency in our renewable operation have allowed us to achieve the following results:

Consumptions
528,871t biomass consumption (1.5 tons per MWh generated)
-34% water consumption per MWh generated vs 2022
-13% direct energy consumption per MWh generated vs 2022
Waste
-9% in total waste produced per MWh generated vs 2022
98% of waste recovery
94% hazardous waste recovery
04.4

Energy transition

The energy transition has principles such as the production of clean energy and the optimization of its use. For this reason, our business strategy presents a double perspective:

Increase the amount of clean energy produced

CO2

Renewable energy production drives decarbonization by replacing fossil fuels, helping to reduce energy system pollution and greenhouse gas emissions.

tons of CO2
avoided

0

+10% vs 2022

Reduce and offset our emissions

tCO2-eq/MWh

Not only do we take advantage of our resources, but we also join external initiatives to exchange practices and align with the most demanding commitments to reduce our emissions.

Reduction
direct emissions

- 0 %

reduction of direct emissions in tCO2 -eq/MWh generated vs 2022

Greenalia's carbon footprint

tCO2eq

For the 5th consecutive year, we calculated our carbon footprint.

This includes direct emissions from our daily activities in the renewable energy business, as well as indirect emissions associated with our supply chain.

Scope 1
Direct emissions

0

These are GHG emissions associated with sources that are under our direct control.

Scope 2
Indirect emissions

0

They are associated with the generation of the electricity we purchase.

In 2023, almost all of the electricity consumed (+97%) came from renewable sources

Scope 3
Indirect emissions

0

Indirect emissions associated with our entire value chain, both upstream and downstream of the company.

People
05

People

Surroundings of Monte Tourado Wind Farm

05.1

Our Team: The Green Team

Our people are the engine of our business success, talent with extensive experience in various sectors, committed to a project of 100% Galician origin and international projection. Our talent management model focuses on building sustainable, high-performance teams.

We promote an inclusive and collaborative work environment, increasing our range of profiles to adapt to new business needs, where two distinct lines stand out. On the one hand, we have profiles focused on the processing of renewable technology projects, their financing and corporate management. On the other hand, we have profiles responsible for the collection, packaging and logistics of biomass waste, its control within our plant and the management of its personnel.

05.2

Talent management

Our approach to the talent cycle covers all stages of our teams' development. We understand the Talent Cycle from a comprehensive perspective, which brings together the following processes:

Talent cycle

A —

Attraction
and promotion
of talent

B —

Training
and development

C —

Feedback

A —

Attraction
and promotion
of talent

B —

Training
and development

C —

Feedback

Prosperity
06

Prosperity

Operational team in the surroundings of Greenalia Wind Farm

06.1

Local socioeconomic impact

Our main objective is to maximize the value generated by our projects for the benefit of all stakeholders, demonstrating our strong commitment to creating positive impact and sustainable employment.

The development of our business activity represents a wide direct economic impact on the economies close to our renewable assets.

Direct economic impact
icono-cs_s1
+ 24 M
direct economic impact in Galicia (ES) and Texas (US)
+ 125 M
in payments to suppliers

Along with the economic impact of Greenalia's renewable projects, we reinforce our business strategy based on creating value through job creation, through demand for goods and contracting services to local companies close to our pipeline.

During 2023, the development of new projects, as well as the maintenance of our renewable energy generation assets, have involved more than 24M € in payments to local suppliers throughout Galicia (Spain), as well as in Texas (US).

distributed through:
+ 120
direct O&M and transportation jobs
+ 800
local businesses
+ 100
small companies dedicated to the biomass business in rural Galicia
06.2

Contribution to the community

The Greenalia Foundation for the energy transition is Greenalia's key element when it comes to articulating initiatives with a high social component. Its main axes are support for projects that contribute to the energy transition, the socio-economic development of local communities and social inclusion.

The Greenalia Foundation has collaborated with social initiatives:

Social collaborations
icono-cs_s1
9
social projects
+ 135,000
social investment