Our sustainability performance
During 2017, we saw the effects of embedding our social programmes soundly in our organisation. A particular point is that we made considerable progress on making our main CO2-related sources more sustainable by purchasing green production in the Netherlands and achieving energy-efficient buildings.
Areas of attention
Our CSR efforts are aimed at three areas of attention. First of all, Alliander wants to contribute towards the energy transition by giving all customers equal access to renewable energy. You can read more about this in the About Alliander and Customers chapters. In addition, as a large employer, we take responsibility for a social and inclusive organisation. A socially responsible company is an inclusive company where everyone gets a fair chance to reach their full potential. We actively manage diversity and inclusiveness in our HR policy, for example, in recruitment and selection, training and development. You can read more about this in the Employees chapter. Finally, Alliander has ambitious targets for climate-neutral and circular operations including working with partners in our supply chains. In 2017, we developed our strategic goals for the energy transition and inclusive, sustainable operations. We have defined our contribution to the Sustainable Development Goals in detail.
Climate-neutral operations in 2023
Alliander had a substantial CO2 footprint totalling 632 kilotonnes in 2017 although CO2 emissions fell by 192 kilotonnes during the year compared with the year before, representing a reduction of some 23%. The effect of our greening policy was clear for the second successive year. Our ambition is to be fully climate-neutral by 2023; in other words, on balance Alliander will have zero CO2 emissions as a result of our network activities, offices and vehicles in 2023. Our programme on reducing and greening our CO2 emissions is moving us step by step towards more sustainable operations. High-impact measures were the hand-over of our energy-neutral head office in Arnhem and accelerating greening of our overall footprint.
We adopted our targets for climate-neutral operations in 2016. All comparative energy and climate figures in the annual report relate to the previous year.
Emissions from network and leakage losses
90% of our gross emissions are caused by network and leakage losses that arise mainly from the distribution of electricity and gas. Network losses cost us about €60 million in 2017 and can only be mitigated to a limited extent. Nevertheless, we are working to reduce our technical and administrative network losses each year.
Technical network losses
In 2017, technical network losses fell by 1% in absolute terms compared with 2016. Technical network losses are closely related to economic conditions. The reduction programme for technical network losses is being pursued as diligently as ever and focuses on measures for savings at our stations and better day-to-day management of the network. In addition, each year we are replacing grey cast-iron gas pipes at various locations for safety reasons and to reduce gas leakages.
In absolute terms, our administrative network losses were the same as in 2016. Administrative network losses arise in part from fraud including illegally drawing off energy to grow cannabis. We rely partly on the police and judiciary, with whom we work closely, to give us active and focused assistance in our efforts to fight fraud. The digitisation of our networks is supporting the fight against energy fraud. The fall in 2017 depended mainly on better detection of fraud and billing and collecting outstanding amounts.
Greening network losses with renewable energy
Alliander is greening its network losses by generating additional renewable energy in the Netherlands. We have made a deliberate decision to shift the purchase of energy to meet our network losses to energy from new investments in renewable sources in the Netherlands. This will allow us to ensure that our network losses are low-carbon and we will be supporting the objective of renewable energy generation. In 2017, we greened 114 kilotonnes of our total network losses with Guarantees of Origin.
In 2017, we purchased Guarantees of Origin from the new Kattendrecht wind farm in Breda. This fully offset our emissions from buildings and IT processes. Our energy-saving and energy-neutral construction and renovation policy remains in place.
Vehicle and buildings emissions
The concentration of activities and reduction in the number of offices in our distribution area combined with the new way of working are leading to lower energy consumption. Our CO2 emissions from buildings fell by 10% compared with 2016. The remaining emissions have been greened.
We introduced a new mobility programme in 2017. From 1 January 2018, we will move to a different reimbursement system to encourage prudent travel. The emissions criteria for our lease cars have been tightened to 100 g/km and steps have been taken to make electric cars more accessible. During the year we once again invested in a more efficient vehicle fleet: all of our vans have been fitted with speed limiters (Ecodrive). The CO2 emissions from vehicles fell for the first time by 2% compared with 2016.
Alliander’s CO2 emissions
The highest step on the CO2 performance ladder
Our CO2 approach and methodology were externally assessed on the basis of the CO2 performance ladder. Certification on the CO2 performance ladder provides proof of insight into the company’s own footprint (level 1), the possible reduction measures (level 2) and the competence to actually implement these measures (level 3), make insights transparent (level 4) and initiate innovations with supply chain partners (level 5). The CO2 performance ladder is often used as a tender award criterion. In 2017, we maintained level 5 on the Ladder. This means that we know the CO2 emissions of our A-suppliers, have achieved the level 3 and 4 objectives, and are publicly committed to the government’s CO2 reduction programme. We are proud of this step but to retain our excellent position on the CO2 performance ladder we must continue mobilising and challenging our suppliers to reduce emissions throughout the supply chain.
Climate risk and adaptation
Alliander is a member of the Delta programme, a forum for discussing the risks from climate change and coordinating the national approach. Effects and risks are assessed and action is focused on adaptation and management by our crisis and disasters organisation. Risks to existing and planned assets from floods, wild fires and storms are examined. Attention to the energy transition and sustainable operations policy are focused on actively limiting emissions and sustainable energy supply.
Supply chain responsibility with partners
We achieve a considerable part of our CSR performance by working with partners, managing the value and product chains where we have impact as a result of our financial expenditure or the existence of specific risks. Our Socially Responsible Procurement (SRP) policy pays particular attention to the three sustainability pillars: circularity, CO2 and labour participation.
A sustainable relationship with our suppliers
With an annual procurement volume of about €900 million, we are a major purchaser of products and services in the Netherlands. Together with our suppliers, we can make a major contribution to sustainability. Sustainable procurement is an integral part of our tender invitation/evaluation criteria. Our outsourcing policy incorporates provisions relating to human rights, working conditions, use of raw materials, recycling and/or CO2 emissions. All suppliers contracted by Alliander are required to commit to the ‘Alliander Suppliers Code of Conduct.’ Under this code, which is based on OECD guidelines, our suppliers (and their suppliers and manufacturers) must adhere to ethical and fair business practices. Infringements of the code can lead to sanctions such as termination of the contract or temporary suspension of work with or without notice of default. Regular audits are conducted in which compliance with the Code is discussed. Compliance with chain aspects and monitoring of possible discussion points are part of the audit reports. If we work with companies in low-wage countries, we conduct risk-based audits of these suppliers. In 2017 14 audits were carried out.
In addition to the customary quality and product checks, we look at elements of CSR such as compliance with universal human rights, working conditions, health and safety and the environment. We work with independent external parties who are familiar with and can assess local conditions for the CRS audit. No critical deficiencies in these themes were reported at our suppliers during the year. In addition to the Code of Conduct, 70.4% of our goods and services were purchased on the basis of SRP statements in 2017 (2016: 71%). This supports our circular procurement objective in the Netherlands. For example, with the SRP statements we encourage suppliers to employ people at a distance from the labour market to work on our products and services. Alliander reports each year on the number of new suppliers screened for SRP. In 2017, SRP statements were entered into with 16% of new suppliers. We ask suppliers which do not have a SRP statement to register on the FIRA Platform (www.fira.nl). These suppliers are requested to share their own sustainability results on the FIRA platform. FIRA assures the quality of the information supplied. The platform brings parties together and gives us more insight into the sustainability performance of suppliers. FIRA prepares its reports in conformity with the international CSR standard: ISO 26000. Registration gives the supplier insight into sustainability performance and ambitions. Alliander requires work to be performed in line with safety protocols and standards for working with gas and electricity such as VIAG and BEI. Suppliers’ staff must comply with these.
Outsourcing, investment and production in other countries sometimes lead to an increased risk regarding the recognition and observance of fundamental human rights, safety and the environment. An organisation can involuntarily become involved in dubious practices such as child labour. The FIRA and ISO 26000 principles help us draw suppliers’ and chain partners’ attention to this. We make active checks on possible problems in the chain in the case of higher-risk tenders, such as the Fair Meter project. As well as advance checks, we also carry out on-site audits at contract parties. In the event of infringements, we end the business relationship or impose other sanctions in line with the contract and the Alliander Suppliers Code of Conduct.
First resource passport
In early 2017, Liander and its suppliers AVK Plastics and Kiwa Technology developed a format for the resource passport. This is used to provide greater insight into the materials used in products we purchase. The passport also gives insight into the sources of materials used. The AVK Plastics inspection cover was the first product to be given a resource passport. The format and instruction manual are available on www.alliander.com/nl/over-alliander/leveranciers/grondstofpaspoort
As a network operator, we use large quantities of materials and consumables. We have a responsibility to do the best we can in meeting our materials needs and so we are aiming to make circular purchases of at least 40% of our primary assets by 2020. This means that all raw materials we use are recycled and nothing is wasted. To do this, our management focus is along four lines:
We make the best possible use of the materials we have.
Where possible we make circular purchases of our main materials.
We avoid wasting materials in our operations.
We recycle 100% of the remaining waste.
Circular procurement demands intensive co-operation with our suppliers. Underlining our commitment to this policy, we became one of the first 20 signatories of the Circular Procurement Green Deal with the aim of learning from each other’s experiences when starting up circular procurement processes and to speed up circular purchasing. The more than 60 participants have a great deal of knowledge and experience. Alliander makes a major contribution to these objectives, involving such things as protective clothing, transformers, redeveloping office space, coffee cups, furniture and fair meters.
In 2016, we integrated circular procurement into our purchasing processes. Each quarter we report on the percentages of circular procurement and recycling. There is a clear roadmap for achieving our targets. The percentage of circular procurementat the end of 2017 was about 6% thanks mainly to the first resource passports for cables which show that they include recycled materials and can be recycled. The first pilot with circular cables which demonstrably contain more recycled material will start in 2018.
Alliander is an initiator of the Green Networks platform consisting of several national infrastructure managers and which is working to create a climate-neutral and circular national infrastructure sector.
In 2017, the first circular cable was laid and there was intensive work on the Petaplan: the generation of large quantities of sustainable energy on land owned by Rijkswaterstaat and ProRail. The Ministries of Infrastructure and Water Management and of Economic Affairs and Climate Policy are involved in the project.
During the annual Springtij event, the partners in the Green Networks (Alliander, Enexis, Gasunie, ProRail, KPN, Stedin,TenneT and Rijkswaterstaat) signed a mission statement on cooperation on Impact Measurement and Sustainable Development Goals.
Landis+Gyr: Fair meter can be even fairer
Alliander is working with Stedin, JUVA and Enduris and meter suppliers Landis+Gyr and Floniskra on the design of new smart meters to create a sustainable version: the Fair Meter. Working with Landis+Gyr, Alliander developed the Fair Meter Pilot - a new, demonstrably more sustainable design. This led to a new generation of electricity meters with a sharp reduction in the use of raw materials as one of the benefits. In the past year, Landis+Gyr has developed a meter that uses 25% less plastic and 35% less metal. Product manager Joe Andrews of Landis+Gyr wants to go further.
Landis+Gyr has over 100 years’ experience in finding solutions to help consumers use energy in a better way. In the case of smart meters, this involves offering more insight into energy consumption and reducing the burden on the environment. “As a business, we use valuable raw materials”, Joe explains. “And we manufacture products with a long but not indefinite lifespan. We see it as our responsibility to approach this sensibly and carefully. That’s why we want to do all we can to make the fairest possible energy meter for our customers.” According to Joe, a fair meter is one that creates more social and economic value during manufacture and use than it costs. He sums this up as, “The meter must be fair for the manufacturer, fair for the supplier, fair for the customer and fair for the end-user”.
Joe says that, looked at carefully, the last version of the fair meter was already a fair meter in production methods, raw materials usage and transparency of processes. “But that didn’t stop us from looking for ways to make it even fairer. The first thing we did was significantly reduce the use of plastic and metal in the design. One challenge was to find ways of using recycled plastic. The parts are so specific that it is difficult to find suitable high-quality materials.” Joe knows that the new meter is as fair as it can be. Nevertheless, Landis+Gyr continues to look for improvements. “The ‘Fair meter’ concept is not the final aim but an ongoing process.”
Network operators Alliander and Stedin have been closely involved in the development process. “It’s safe to say that the cooperation with Alliander was what drove and motivated us to think outside the box and devise ground-breaking improvements. We collaborated transparently and openly and shared information, which is by no means something you can take for granted. We are delighted that parties like Alliander and Stedin always had an eye for the necessity for a fair meter.”