Environmental Protection

GRI 2-23, 2-24

Environmental protection management

The Company’s main objectives in the field of environmental protection and environmental management are pursued in accordance with the following documents:

• Climate change policy of PJSC Rosseti, which establishes climate risks relevant to Rosseti Group, risk management mechanisms and climate change adaptation measures. The purpose of the Policy is to streamline approaches to climate change in the course of the Company’s activities.
• PJSC Rosseti’s sustainable development policy, which sets out Rosseti’s sustainable development agenda, particularly in the areas of environmental protection and rational use of natural resources.

Environmental Policy approved by the decision of the Company’s Board of Directors on 16 April 2024 (Minutes No. 568/2024 dated 16 April 2024).

Principles of the environmental policy:

• Priority of environmental safety in production activities
• Decision-making that takes into account the needs and expectations of interested parties and the scope of the environmental management system
• Openness and accessibility of information on environmental actions
• Improvement of activities and continuous refinement of core production processes

The environmental policy implementation programme at PJSC Rosseti South sets out objectives for ensuring compliance with the environmental legislation of the Russian Federation and identifies tasks for reducing negative environmental impact. Environmental safety measures are aimed at protecting the air, water and land resources, and wildlife.

NATIONAL PROJECT: ECOLOGY

Rosseti South built a power supply infrastructure for an eco-technopark in the Rostov Oblast. Power engineers erected a 4-km long 110 kV power transmission line and stretched over 12 km of wires. The total capacity of the connection will be over 5 MW.

In 2024, the following measures were put in place by PJSC Rosseti South:

• Analysis of compliance of the Company’s production activities with mandatory environmental requirements for 2023, with target process performance indicators set for 2024.
• In November 2024, a certification audit was conducted at the Volgogradenergo branch of PJSC Rosseti South to verify compliance with the requirements of GOST R ISO 14001.

Results of environmental protection efforts

GRI 2-27

In 2024, the Company held 15 licences for the right to use subsoil resources for groundwater extraction: four licences at the Volgogradenergo branch and 11 licences at the Rostovenergo branch. In order to protect and rationally use water resources under licence agreements, groundwater quality assessment was carried out in 2024 (observation of groundwater level and temperature, recording of water consumption, sampling for bacteriological and chemical analysis, determination of physical properties of water).

In order to protect and rationally use land, the Company organised regular control over separate accumulation of municipal and industrial waste (waste tyres, transformers, batteries, mercury-containing lamps, oils, metal waste, etc.), their timely transfer to specialised organisations for treatment and disposal. In 2024, 529 condensers containing polychlorinated biphenyls (PCB) – waste equipment containing extremely hazardous pollutants – were transferred for treatment and 1,118 – decommissioned.

In 2024, all production sites of Rosseti South branches got the permits, licenses, approvals needed, and new ones are sorted out as the old ones expire. The Company engaged accredited laboratories to control the volume of air emissions in 2024. The test results did not show any above-limit values.

For the purpose of retraining and advanced training of employees, 65 people were trained in 2024 under advanced training programmes for managers and specialists in environmental protection & safety and the environmental management system.

Fines and non-financial sanctions imposed on the Company for non‑compliance with the requirements of environmental legislation

There were no inspections of the Company’s activities and its subdivisions for compliance with environmental and sanitary-epidemiological legislation in 2024.

Application of promising technologies and solutions

In order to improve the level of environmental safety, the following activities were undertaken in 2024:

• Replacement of oil circuit breakers with vacuum circuit breakers (86)
• Replacement of oil-filled bushings with solid-insulated bushings (28)
• Installation of bird diverters on 0.4 kV and above overhead power lines (6,690)

Climate

GRI 305-1

Supply of renewable energy to Rosseti South’s grids

In 2024 (preliminary), wind power generation amounted to over 2 billion kWh, hydro power generation – to over 600 million kWh, and solar power generation – to around 300 million kWh.

In 2024, PJSC Rosseti South concluded a deal for the purchase and sale of green certificates worth 1.5 million kWh issued under the national low-carbon electricity certification system (generated by solar power plants).

Forming an eco-friendly culture

In 2024, employees of the Company’s branches took part in autumn and spring clean-up days to clear rubbish from the surrounding area and plant trees and shrubs; in the run-up to Victory Day, the Volgogradenergo branch run a campaign to plant trees on the grounds of the Mamayev Kurgan, a monument to the Heroes of the Battle of Stalingrad, and employees of the Rostovenergo branch joined an environmental drive to plant trees in city parks to mark the 275th anniversary of Rostov-on-Don.

In order to foster an environmental culture and raise environmental awareness within the Company, 31 staff members participated in the Ecology Dictation.

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Protection of atmospheric air, soil and land, preservation of ecosystems and biodiversity

Measures under the environmental programme for 2024

Atmospheric air protection

• Laboratory and instrumental control of air emissions at sources under contracts with accredited laboratories. The control results did not show any above-limit values
• Development of industrial environmental control programmes
• Development of measures to reduce emissions of harmful (polluting) substances into the atmospheric air during periods of unfavourable meteorological conditions
• Development of sanitary protection zone projects for production sites, measures on observation programme at the boundaries of sanitary protection zones
• Monitoring of carbon monoxide content in vehicle exhaust gases and timely repair of vehicles
• Improvement of operational activities and repair production technology (by the enterprise)
• Use of certified fuels
• Compilation of statistical data on atmospheric air protection and reports on industrial environmental control programmes at the production sites of branches

Protection and rational use of water resources

• Groundwater monitoring in accordance with the programmes developed and registered with the subsoil assets manager for Volgogradenergo and Rostovenergo branches
• Well abandonment and issuance of a new licence in the Rostov Oblast

Waste management

At all production sites, waste is accumulated in places arranged in accordance with the requirements of environmental protection legislation and legislation on ensuring the sanitary and epidemiological well-being of the population, with a view to its further transfer to specialised organisations.

The following measures were implemented in 2024 to achieve the waste management objectives of the Environmental Policy:

Ecosystem and biological diversity conservation

GRI 403-2

• Ensuring the required level of ornithological safety at power grid facilities and, consequently, the required level of power supply reliability, which is achieved through the use of various types of bird diverters

Main environmental safety objectives of the Company for 2025

• To ensure and control safe levels of air emissions from stationary sources; to conduct sanitary and hygienic inspections at the boundaries of sanitary protection zones
• To improve the competence of employees in environmental safety
• To install bird diverters on power transmission poles situated in habitation and migration areas
• To eliminate waste accumulation periods at production sites, ensure timely removal of waste from production sites, fulfil the decommissioning and destruction schedule for PCB-containing equipment for 2023–2024
• To ensure the compliance with subsoil license agreements

Energy consumption and energy saving

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The following targets were adopted under the Programme:

• Reduction of electricity losses in transmission and distribution
• Consumption of energy resources for housekeeping needs
• Number of LED-based lighting devices

In 2024, Rosseti South allocated nearly RUB 3 billion for the repair and maintenance of energy facilities in the regions where it operates, up 16% year-on-year.

Energy saving and energy efficiency improvement measures

According to the results of 2024, the technological saving of measures with ‘direct’ effects on reducing electricity losses amounted to 16.875 million kWh, with an economic saving of RUB 63.128 million.

According to the results of 2024, the effect of the targeted measures to reduce resource consumption for household needs across the Company as a whole amounted to 222,930 TFOE, worth RUB 7.017 million, against a target of 229,750 TFOE, worth RUB 7.23 million.

At the same time, technical measures accounted for 68% (saving RUB 6.67 million or 131.94 TFOE), with the main effect coming from the installation of LED lighting.

According to the results of 2024, the Programme’s effect in terms of reduction of motor fuel consumption amounted to RUB 2.406 million, or 67,110 litres.

Development of the energy management system (EnMS)

The Energy Management System (EnMS) is a part of the Company’s overall management system, which has a well-defined organisational structure and focuses on fulfilling the provisions stated in the Energy Policy through implementing the programmes on energy saving and enhancing the energy efficiency.

Since 2015, PJSC Rosseti South has the EnMS certified to ISO 50001 international standard.

In 2024, 22 internal audits of the Energy Management System were conducted in line with the approved schedule and Standard ISM 80380011-IA/F-5300 049-2020 Internal Audit of the EnMS. From 25 November 2024 to 2 December 2024, JSC SGS Vostok Limited conducted a supervisory audit of the energy management system at the executive office and branches of PJSC Rosseti South to ensure compliance with the requirements of the international standard ISO 50001:2018. The audit results confirmed the compliance of Rosseti South’s Energy Management System with ISO 50001:2018 international standard (the certificate of conformity RU24/00000146). The audit team concluded that the organisation has established and maintained a management system in accordance with the requirements of the standard and has demonstrated the ability of the EnMS to systematically achieve agreed objectives in accordance with the organisation’s policies.

Effects of the energy management system being rolled out at PJSC Rosseti South:

• Uniform standards offering a systematic, comprehensive approach to energy conservation issues are in use
• Financial performance through saving and rational use of all types of energy resources at the Executive Office – branch – subdivision – power grid region level was improved

• Costs were cut, and non-production expenses were found and removed
• Organisation’s reputation and image appeal are being improved
• Each employee is involved in the achievement of energy efficiency and energy saving goals