Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Investor Presentation (November 2020)
12 slides from Norsk Hydro Asa's investor presentation, Nov 16, 2020
Slide 1: Investor Relations November 16 2020
Investor Relations November 16 2020
Slide 2: Objective of session
Objective of session to (1) present latest internal update on key regulatory frameworks (30 mins) (2) answer any questions on the topics (Q&A at end) (30 mins) 2
Slide 3: European Green Deal: Positioning low carbon solutions, protecting competitiveness
European Green Deal: Positioning low carbon solutions, protecting competitiveness Climate neutral by 2050 • Current proposal: from 40% to 50-55% GHG emissions reductions in 2030 Key elements for Hydro • Energy transition • Sustainable mobility • Green buildings • Circular Economy • Sustainable Finan
Slide 4: Regulatory frameworks supporting green transition
Regulatory frameworks supporting green transition 1 EU’s Emissions 2 Indirect Co2 3 EU Taxonomy 4 Carbon Border Trading System compensation Adjustment quotas Mechanism (CBAM) • EU main climate • Indirect carbon costs • Classification of • New carbon leakage policy to reduce passed through to activit
Slide 5: Hydro historically running a short position on EU ETS allowances for direct emissions
1 Hydro historically running a short position on EU ETS allowances for direct emissions • Fewer free allowances allocated in 2020 due to a factor reducing CO2 emissions the free allocation linearly throughout phase 3 of the EU ETS (tonnes 000s) (2013-2020) • Annual position of free and purchased all
Slide 6: CO2 compensation currently received for some of smelter portfolio in EU
2 CO2 compensation currently received for some of smelter portfolio in EU, each country treats accounting differently In 2020, three plants receiving compensation Each of the three countries with different for indirect CO2 costs accounting policy for compensation received Currently receiving Not rec
Slide 7: Changes from 2021 could mean additional Norwegian smelters eligible for indirect CO2 compensation
2 Changes from 2021 could mean additional Norwegian smelters eligible for indirect CO2 compensation Main policy changes from 2021 Hydro and CO2-compensation • EU published member state guidelines for 2021-2030 • More of Hydro’s Norwegian aluminium production will enabling member states to continue s
Slide 8: Calculation includes multiple factors – many of which change year over year
2 Calculation includes multiple factors – many of which change year over year and are not yet determined 𝐸 𝐴𝑖𝑑 = 𝐶𝑂2 𝐹 ∗ 𝐸𝑙𝑒𝑐 𝐹 ∗ 𝐸𝑙𝑠𝑦𝑠 𝑃𝑟𝑜 ∗ 𝐸𝑈 𝐴𝑙𝑙𝑜𝑤 ∗ 𝐴𝑖𝑑 𝐹 ∗ (1 − 𝐶𝑢𝑟𝑡 𝐹) E(aid) is expected aid received for indirect Co2 compensation in a given year Established…
Slide 9: Sustainable Finance supporting EU Green Deal
3 : Sustainable Finance supporting EU Green Deal EU Taxonomy initiaitve included as part of sustainable finance workstream Taxonomy regulation: an activity is substantially contributing to climate change mitigation if it • Has greenhouse gas emission levels that correspond to the best performance in
Slide 10: EU Taxonomy covers only part of Hydro’s activities
3 EU Taxonomy covers only part of Hydro’s activities Sectoral scope as from the TEG-report EU Taxonomy’s aluminium criteria still under determination 10
Slide 11: Carbon Border Adjustment Mechanism (CBAM) another measure currently under consideration
4 Carbon Border Adjustment Mechanism (CBAM) another measure currently under consideration As currently stands, CBAM not most effective carbon leakage measure • To put a price on carbon content of imports thereby providing carbon leakage protection CBAM ambition1) • To replace current carbon leakage
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