Planet

TCFD reporting

The Task Force on Climate-related Financial Disclosures (TCFD) was created by the Financial Stability Board to develop consistent climate-related financial risk disclosures.

The reporting in our CSR report has been prepared, as far as possible, with reference to the recommendations of the TCFD with regards to governance, strategy, risk management, metrics and targets.

The TCFD acknowledges that implementation of its recommendations will take time.

Our TCFD roadmap sets out our own pathway whilst recognising that this is an ongoing process where we will build upon each element of governance, strategy and risk management in addition to metrics and targets over the years to come.

TCFD framework

Governance

The management team’s oversight of the company, and assessment and management of risks and opportunities, including those that are climate-related, are described in the governance overview, governance compliance and risk and opportunity oversight sections of this website.

 

Strategy

Mercuria recognises the threat that climate change represents and the need for the world to transition to more sustainable forms of energy as well as preserve and restore the natural environment. This is why in 2021 we committed that over half of our investments would be into the energy transition by 2025. At the end of 2022 we were already well ahead of this commitment.

As such, our strategy implicitly leans into the energy transition, whilst also taking into consideration the energy trilemma and that future energy supplies need to be both secure and affordable as well as sustainable.

We are working on better describing the climate-related risks and opportunities the organization has identified over the short, medium, and long term, as well as the impact that these have on our business, strategy, and financial planning.

Risk management

The identification and assessment of climate-related risks are implicit in Mercuria’s purpose of connecting markets and advancing the energy transition as well as in its overall strategy. Mercuria helps to bring energy markets together to support the needs of today, which means that we have to help the global energy system maintain security of supply to meet energy demand whilst doing so in a way that is both affordable and sustainable.

We also recognise that we need to help advance the energy transition for tomorrow to ensure that energy needs are met in a manner that is consistent with the Paris agreement limiting global temperature rise to no more than 2 degrees Celsius by 2100. These are the reasons that our strategy has been to ensure that more than 50% of our investments are into the energy transition by 2025 and that the mix of the group’s trading activities have moved towards cleaner fuels and carbon credits.

The physical risks to our business are identified and assessed as part of our asset due diligence processes as described in the governance compliance section of this website. We conduct ongoing due diligence of our asset holdings through regular, recurring meetings with the local leadership for each asset and appropriate site visits and audits. This level of interaction drives a collaborative approach, encouraging best-practice knowledge sharing between assets across our group.

Metrics & targets

We have been measuring and reporting on our GHG footprint over a number of years and we continue to make improvements.

In 2022, we sought to improve data quality, processes around data collection, and calculations where better data or approaches are now available. Carbon accounting standards and new guidance continue to evolve and we have sought to update our approach accordingly.

Absolute scope 1 & 2 emissions and reported scope 3 emissions are reported in the Planet in 2022 section.

In 2022 we made the decision to become a net zero company and as such offset all of our scope 1 & 2 emissions from 2022.

To further advance the energy transition, in 2021 our CEO pledged that by 2025 over half of our investments would be into the low carbon and energy transition sector. At the end of 2022 we were well ahead of this target.

At present we have not set any additional targets regarding climate change.

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