Offsetting Scope 1 emissions We offset CO2 emissions from the combustion of fossil fuels (Scope 1) at production and logistics sites that we are unable to avoid in the short and medium term with CO2 credits from international climate protection projects (see box below). When selecting projects, we relied on certification systems such as Gold Standard and Verra. We aim to specifically support projects in the context of renewable energies, energy efficiency, forest protection, and reforestation (in line with the REDD+ concept) that have a demonstrable benefit for the population. We see this positive effect particularly in projects that relate to the Sustainable Development Goals of Education (4), Water Supply (6), and Industry, Infrastructure and Innovation (9). GRI 2-23 Guarantees of origin for electricity Since 2021, we have been reporting on the procurement of green electricity for our sites in Germany and are setting the corresponding Scope 2 emissions to zero. Since 2023, this has also been the case at all international production and logistics sites. Using the amount of electricity consumed by Festo, the electricity supplier purchases guarantees of origin issued for electricity from wind and hydroelectric power plants in the respective electricity grid. GRI 302-1 This method allows the environmental characteristics of electricity generation (i.e. zero emissions) to be taken advantage of without the electricity physically coming from the same power plant as the voided guarantees of origin. The procedure complies with the GHG Protocol. The guarantees of origin also meet the requirements of the European green energy label EKOenergy and those of the American green energy label green-E. The availability of green energy labels for the locations in China is still being examined. Once the current electricity supply contract expires, only EKOenergy-labeled guarantees of origin will be used for the German locations. We intend to further improve the ecological quality of green electricity in the medium term. We are therefore examining whether electricity and guarantees of origin can be bundled from 2027 onward – that is, procured from the same facilities – or whether green power purchase agreements (PPAs) can be concluded. Both options would have a greater incentive to expand electricity generation from renewable energies. Expansion of in-house renewable power generation Festo has been investing in generating its own electricity using photovoltaic (PV) systems since 2004. In 2023, photovoltaic systems were installed at a further 20 locations. The total PV capacity installed at Festo has thus been increased by more than 60 percent and now amounts to 13.8 megawatt peak. By the end of 2023, all PV installations worldwide generated 15,651 megawatt-hours of electricity. This avoids 10,600 metric tons of CO2 per year at the plants of the respective electricity suppliers. Energy controlling and savings With the exception of three smaller plants, our locations are equipped with energy-monitoring systems. These make it possible to monitor energy consumption, identify abnormally excessive consumption and its causes, and initiate corrective measures at short notice. Routines for monitoring consumption during nonproduction periods have been implemented and intervention thresholds have been defined. Energy teams Energy teams were set up at all production sites in 2022. Their task is to further develop energy control and to identify and implement investment-related and behavior-related measures in production and building management. Measures In 2023, the total output of our photovoltaic systems worldwide increased by 60 percent. We have earned the corresponding amount of CO2 credits from the following projects: Guohana Rongcheng Wind Farm Project (China) VP Biosupply Wastewater Treatment and Biogas Utilization Project (Thailand) Hebei Landfill Gas Power Generation Project (China) Quang Minh Solar Power Project (Vietnam) Use of more than 15,000 energy-efficient and clean-burning stoves (Uganda) Chudu Afforestation Project (China) GRI 302-3, GRI 302-4 52 53 1. Blue World 2. Strategy and Management 3. Climate Protection and Resource Efficiency 4. Technical Education 5. People at Festo 6. Ethics and Governance 7. GRI Index 8. Report Profile Festo SE & Co. KG Sustainability Report 2023 Festo SE & Co. KG Sustainability Report 2023
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