EDP’s European thermoelectric power facilities are covered by the EU ETS - European Union Emissions Trading System. EDP is involved in this way in the European trading system, EU-ETS. It has already entered the Kyoto period (2008-2012) with more stringent demands than those of the pilot phase.
 
The National Allocation Plan of Carbon Emissions Licences adopted in Portugal in 2008 (PNALE II) and in Spain (Planes Nacionales de Asignación - PNA), allocated 30% less carbon dioxide licences to EDP facilities than in the pilot phase. The EDP Group uses its participation in carbon funds in addition to emissions licences to comply with the goals of the Kyoto Protocol. As a member of carbon funds it has concluded contracts with several international bodies for the purchase of carbon credits originating from Clean Development Mechanism (CDM) and Joint Implementation (JI) projects.

EDP also acts in the voluntary carbon credit market generating several tons of VERs - Verified Emission Reductions. EDP in Brazil made two VER sales operations in 2009. EDP is also involved in the RECS - Renewable Energy Certificate System through four mini-hydroelectric power stations, Ponte de Jugais (19.22 MW), Sabugueiro I (13.24 MW), Desterro (12.592) and Vila Cova (23.4 MW), with an average annual generation of around 200 GWh.

Climate change gives rise to various types of risk, including:

> Operational risk - Damage to (electricity and gas) distribution grids/networks or generation centres, or to wind turbines due to extreme weather events; the stoppage of thermoelectric power stations due to cold reservoir unavailability; increased volatility of production factors such as wind and total water flows, etc.

> Regulatory (Business) - Any legislation on carbon dioxide emissions impacts on the business of EDP.

> Market – Variations by source on the amounts of energy traded on the market with an impact on the corresponding price or change in the price of CO2.

Read EDP’s replies to the Carbon Disclosure Project for further information, read it here.
 
Risks related to Climate Change:

EDP created the CLIMEDP project in this field, with the objective of identifying, describing and managing the operational risks posed by climate change and extreme weather events in particular. Furthermore, EDP has proceeded to identify and describe all the risks associated with climate change, including those connected to business strategy, acknowledging the fact that the impact of climate change on business is much broader than mere operational risk.  The information was compiled and is available on the Group’s internal risk management tool, the Risk Portal.
 

EDP has been monitoring the progress of negotiations on the theme of Climate Change. In December 2009, at the United Nations Climate Change Conference in Copenhagen, which included the COP 15 (Conference of the Parties), EDP issued a statement of its position.
 

EDP invests in innovation projects that lead to a reduction in electricity use and the consequent reduction of the carbon footprint. The following projects are examples of this:

> Inovgrid – aims to establish a smart grid that can integrate and articulate micro-generation, electrical mobility, renewable energy, more flexible tariffs and better supervision of the grid while minimising losses, reducing the risk of fraud and efficiently adjusting demand to supply.

> Electrical mobility – aims to disseminate the electric car as a means of transport generating lower direct emissions. The advantage of this technology is that it can act as a mechanism for regulating network loads, thus fostering the viability of renewable energy.

> Off-shore Renewables – Permit the improved harnessing of wind energy potential and the demonstration of the pilot project for harnessing wave energy.

> Windfloat – A technology that allows wind turbines to be sited offshore in locations more than 50 metres deep, contributing to the improved harnessing of wind energy potential.

In addition to all the above-described initiatives to reduce EDP’s carbon footprint arising from its primary fuels and processes, EDP also plays a very active role in promoting energy efficiency among its customers and the general community, and the consequent reduction of emissions.

EDP launched a new business unit in 2010, EDP Serviços, aimed at providing services to three major customer groups: transportation, buildings and industry.

EDP ​​also sells Green Electricity certified VERs (issued by IBA). This business is being restructured during 2011 and is expected to increase substantially.

Examples of the projects developed by EDP:

> Industry and commerce: e-cube Cooling Systems - Systems placed inside cold rooms that optimise consumption by reducing the number of engine start-ups, while always ensuring the appropriate temperature range for the conservation of food.

> Commercial and Residential Sector: Energy-efficient Bulbs – The replacement of incandescent light bulbs with energy-efficient bulbs.

> Municipalities: Astronomical Clocks - Control systems governed by natural light that are installed on municipal lighting systems. LED Traffic Lights.

EDP has also been promoting electronic billing among its customers, thus reducing paper and energy consumption, and consequently CO2 emissions.  In 2010, 764,000 customers in the Iberian Peninsula moved to electronic billing.

EDP also has an in-house programme – Econnosco, which aims to reduce staff’s energy and water consumption. These reductions were achieved by removing excess lighting fixtures, replacing incandescent bulbs with compact fluorescent bulbs, modifying printers to print double-sided, activating standby mode on computers and automatically turning off lighting at night-time. These measures in Portugal contributed to a reduction in electricity consumption of about 26% and 32% in water consumption in administrative buildings in 2009, compared to 2006. Moreover, two-sided printing led to a decline in paper consumption of approximately 11.7 tons.

The fleet of EDP vehicles was also targeted by several projects aimed at reducing fuel consumption and hence emissions, these being:

> The conversion from courier services to electrical courier services; > The purchase of hybrid vehicles;

> The use of geo-referencing in EDP Distribuição vehicles to optimise routes;

> Promoting the use of electrical vehicles;

> Training courses: in eco-friendly driving, off-road driving and defensive driving.


In the coming years, EDP will concentrate its Lisbon and Oporto offices. At this point, is starting to draw up Mobility Plans in articulation with external partners.