EDP Group’s Vision and outlook for 2024

EDP’s leadership team share their vision and anticipate the main challenges for 2024. Over the next few pages, find out what the near future holds for us, in what is a crucial phase for achieving the key objectives for an energy transition.

In a context of macroeconomic instability, the company’s main focus is to continue diversifying its renewable portfolio worldwide. This year, we expect to reach 4 GW of renewable capacity. It will also be a time to continue investing heavily in electricity grids, a key segment for the energy transition. What role will EDP play in the global energy transition, and what are the initiatives that will contribute positively to the change the world needs?

The energy transition is key to effectively tackling climate change and to meeting the challenges of energy security and access to clean energy. Our goals are clear: phase out coal, keep gas as a short-term backup, and continue to invest heavily in renewables, grids, and energy efficiency while supporting our clients. At the same time, we must keep pace with changes in the world and the energy sector, increasing the use of digital tools, technological innovation, and investment in skills and talent.

The offshore Windfloat project and floating solar project in the Alqueva are prime examples of this.

The main message is that we need to accelerate the expansion of renewables and ensure more investment and innovation to reduce overall costs. EDP is ready for it, but we need regulatory stability. And the macroeconomic context is not helping, nor is the worsening of climate change.

The energy transition requires a serious commitment from everyone: governments, companies, and civil society. EDP already has a global presence based on four key regions (Europe, North America, South America and Asia-Pacific) and has made a clear commitment to renewables over the last two decades, from almost 80% thermal generation then to more than 85% renewable generation today.

And we have been doing it so governed by the principle of just transition, working together with governments and local authorities in the regions impacted by the decommissioning of thermal assets, like in Sines, and with plans to have “green energy hubs” in those locations, with renewable energy, green hydrogen, storage, and flexibility.

Today, our global emissions are 48% lower than in 2015 and we intend to reduce absolute emissions by 90% in all areas by 2040. We are investing €25 million between 2023 and 2026, with around 85% (€21 million) in the renewable segment: wind, solar, green hydrogen, and energy storage. All of it combined with greater investment in our grids and an increasingly sustainable customer offering.

What are the priorities for 2024? What areas will be more critical to invest in and what concerns should we be more aware of?

Our focus for 2024 remains growing our renewable energy portfolio globally, particularly in Europe and the United States. Last year saw some delays in the installation of new renewable capacity, so there is a greater challenge in 2024. The goal is to install around 18 GW of renewable capacity between 2023 and 2026, as we announced on Capital Markets Day back in March 2023. I am confident that all our teams are working toward this goal. At the same time, we will continue to invest in electricity grids, which is a key segment for the energy transition.

What are the company’s investment strategies to continue the modernization of the power grids in the long term? What specific advances are shaping the sector today?

The transmission and distribution grids are an essential pillar of the energy transition. A lot of investment is needed to cope with increased distributed production, the electrification of the economy, electric mobility, and growing self-consumption. This trend is present in the most developed countries, leading to grids needing to become increasingly decentralized, digitalized, and more flexible.

In line with this, the group’s investment strategy in the grids segment involves a strong commitment to modernization to enable that transition. EDP is investing €3.2 billion until 2026 to strengthen the digitalization, intelligence, resilience, and efficiency of our infrastructures in the three countries where we operate grids: Portugal, Spain, and Brazil. Digitalization also plays a central role in all of this. This investment cycle will reinforce the digital transformation of grids to ensure quality, efficiency, and physical and cyber-physical security. The focus on automation, monitoring, remote control, and sensorization of the grid will continue, leveraging our investments in grid intelligence, managing real data about energy demand behavior, and using the information gathered to address quality-ofsupply issues.

"We will continue to work on our organizational model to ensure that we have a structure that reflects our global dimension effectively, increasingly fostering collaboration, efficiency, and agility in our decision-making."

In terms of people, their development and cohesion, and attracting talent, what will be the challenges for EDP in the coming year?

We have more than 13,000 employees worldwide, and I hope that EDP will continue to evolve as a global organization, supported by a common purpose (“Our energy and heart drive a better tomorrow”) that has a positive influence on our people’s work experience and sense of belonging. This has become very clear over the past year.

We are mindful of the path we are on as an organization and will continue to work on our organizational model to ensure that we have a structure that reflects our global dimension effectively, increasingly fostering collaboration, efficiency, and agility in our decision-making. Our track record of strong organizational climate results, along with EDP’s recurring international recognition as a top employer, demonstrates the company’s commitment to providing a positive and attractive work experience.

We are also committed to an increasingly global, swift, and inclusive recruitment experience and will continue to offer an attractive and competitive compensation and benefits model. We also want to consolidate a culture of feedback and transparency that promotes meritocracy.

In terms of development, we are going to continue to accelerate the development of our leaders, empowering them for an increasingly global role and enabling them to develop their own teams. Nevertheless, we need to develop business skills that will enable us to respond to the new challenges of the energy transition— not only through training that is increasingly tailored to the needs of each individual, but also through our global marketplace of internal mobility opportunities, one of the finest attributes of our organization.