EVN AG

Composition of the Executive Board and Supervisory Board

The Executive Board of EVN had three members as of 30 September 2024. Of the 15 members of the Super­visory Board on that date, ten were elected by the Annual General Meeting. The Supervisory Board also included five members as of 30 September 2024 who were delegated by the works council.

Relevant experience of the members of the Executive Board and Supervisory Board

The listed EVN Group, together with its subsidiaries and Group companies, is active primarily in Austria, Germany, ­Bulgaria and North Macedonia. With state-of-the-art infrastructure, it provides electricity, natural gas, heat, drinking water supplies, wastewater disposal and thermal waste utilisation from a single hand. The product portfolio also includes network operations for internet and telecommunications as well as various energy services for private and business customers and municipalities.

The members of the Executive Board and Supervisory Board, as seen from a general overview, have relevant experience and knowledge in both an international and listed context in the following areas: controlling, accounting, corporate accounting, finance and risk ­management, investor relations, procurement and purchasing, internal audit, human resources, communication, IT and data processing, safety and infrastructure, customer relations, innovation and sustainability, energy generation, the energy sector, sales, project development, stakeholder management, legal affairs and the capital markets.

Disclosures on the diversity of the ­Executive Board and Supervisory Board

The Executive Board as of 30 September 2024 included one female member (33.3%) and two male members (66.7%), all of whom ranged in age from 40 to 60 years.

The 15 members of the Supervisory Board as of 30 September 2024 included six women (40%) and nine men (60%). Of this total, 6.7% were younger than 40 years old, 53.3% between 40 and 60 years old, and 40% older than 60 years.

Of the Supervisory Board members elected by the Annual General Meeting, 90% are independent of the company and its Executive Board according to C-Rule 53 of the Austrian Corporate Governance Code (ACGC). The members classified as independent according to C-Rule 53 of the ACGC include six persons who do not hold or represent the interests of an investment of more than 10%. Based on the total number of Supervisory Board members elected by the Annual General Meeting, 60% are classified as independent according to C-Rule 54 of the ACGC.

Working procedures, roles and responsibilities of the Supervisory Board

At the Supervisory Board level, the Audit Committee includes Maria Patek as a sustainability expert together with shareholder representatives Georg Bartmann, ­Reinhard Wolf, Jochen Danninger and Willi Stiowicek and the employee representatives Paul Hofer, Uwe ­Mitter and Monika Fraißl. This committee is also responsible for reviewing the non-financial statement according to the rules of procedure for the Supervisory Board (§ 267 (6) of the Austrian Commercial Code). The Audit Committee meets at least twice each year and reports to the full Supervisory Board.

Sustainability organisation

At the Executive Board level, the staff department for innovation, sustainability and environmental protection reported to the full Executive Board up to 31 August 2024. This staff department was upgraded to a corporate function as of 1 September 2024, renamed "innovation and sustainability" and assigned to the reporting line of the CTO through a change in the rules of procedure for the Executive Board.

The corporate function for innovation and sustainability is responsible for sustainability issues as well as environmental and climate protection in the EVN Group. A central component of these activities is the Group-wide and strategic coordination of sustainability and, in particular, the implementation of the new legal requirements. In preparation for the mandatory application of the CSRD by EVN beginning with the 2024/25 financial year, the following departments nominated staff responsible for the individual ESG standards: innovation and sustainability, human resources, safety and infrastructure, procurement and purchasing, information and communications, customer relations and corporate compliance management. The central management by these corporate functions is intended to ensure compliance with high sustainability standards throughout the EVN Group. It will also support the operational development and implementation of new ESG aspects like the application of the CSRD.

An extensive exchange of information between the innovation und sustainability corporate function and the responsible Executive Board member takes place every four to six weeks within the framework of management meetings and more frequently if required.

The full Executive Board is informed of sustainability programmes and plans at the quarterly meetings of the sustainability steering committee. This committee deals with current ESG issues, approves major ESG activities and, due to its broad composition, ensures that the addressed strategies, measures and goals are rolled out and implemented in operations throughout the Group. The circle of participants also includes other key corporate functions (in particular controlling and investor relations, accounting, finance, legal and public affairs) as well as representatives of key Group companies and departments from Austria and other countries.

The project-related sustainability steering committees, in 2023/24 above all the CSRD readiness steering committee, are responsible for reporting on and the determination of concrete measures. The circle of participants includes, in particular, the full Executive Board, the innovation and sustainability corporate function, and representatives of the other involved corporate functions and Group companies in Austria and other countries.

In addition to continuous exchange with internal experts, the Executive Board and Supervisory Board can draw on several advisory boards in which external experts from various disciplines contribute their expertise and outside perspectives on ESG issues: the Sustainability Advisory Board, the EVN Social Advisory Board and the EVN Art Advisory Board.

EVN's strategic goals result primarily from legal ­regulations, capital market and rating agency requirements, customers' demands, the EVN strategy, the EVN Climate Initiative, the materiality analysis and ­voluntary commitments, e. g. in connection with the Science Based Targets initiative.

The approved measures are implemented through ­projects carried out by the staff in the innovation and sustainability corporate function and employees in ­various departments and companies concerned in ­Austria and other countries. Function and role descriptions as well as guiding principles are issued and/or adapted to anchor ­competence and responsibilities in the organisation ­­(in particular, through the EVN sustainability guideline, the EVN Code of Conduct and the EVN Integrity Clause).

Target achievement is measured according to the target, form and term in line with the above-mentioned formats as well as through internal (in the form of steering committees for each segment) and external quarterly reporting and the annual financial statements. It is based on the defined project goals or also on the annually defined individual non-financial goals set for the Executive Board members and management.

Reporting requirements result chiefly from reporting requirements for specific ­project activities, management meetings and steering committees as well as from the legal requirements for quarterly reporting and the annual financial statements.

The proposals for investment projects that require the approval of the Executive Board and/or Supervisory Board are also required to include a standardised evaluation of the ESG impacts, opportunities and risks. In the 2023/24 financial year, this mainly involved the budget preparation for the EVN Group and planned projects for heat supplies, renewable generation and power plants/power plant locations.

As previously mentioned, both the Executive Board and the Supervisory Board receive regular information and, at the same time, training on sustainability issues. This information transfer and training also takes place as part of a regular series of events entitled "Supervisory Board Special" in which internal and external experts lecture on key topics.

The Supervisory Board plays an important role in ­sustainability reporting. Quarterly and annual reports are presented to the Audit Committee and the full Super­visory Board prior to publication and discussed by the Executive Board and Supervisory Board. The Remuneration Committee is responsible for monitoring the achievement of sustainability targets in connection with remuneration policy, remuneration practices and remuneration-related incentive structures. In addition, the Executive Board provides the Supervisory Board with up-to-date information on ESG issues at every meeting. The content is presented primarily by the Executive Board, if necessary with the support of internal experts. The Supervisory Board is also able to contact internal experts at any time for additional information apart from the scheduled meetings.

Information for the Supervisory Board

Various organisational processes ensure that the ­E xecutive Board is informed of important feedback from stakeholders. The quarterly steering committee meetings, which cover all segments as well as sustainability and public affairs, and the project steering ­committees are used for this purpose. These committees include the Executive Board as well as management ­from the respective areas.

Due diligence audits based on ecological and social aspects are integrated in the early phase of construction projects. They cover internal decisions as well as project approval by the Executive Board or – for larger projects – approval by the Supervisory Board.

In addition to the continuous exchange with internal experts, our Executive Board and Supervisory Board can draw on several advisory boards in which external experts from various disciplines contribute their expertise and outside perspectives on the ESG aspects of our activities. The high relevance of ESG issues and the strengthening of sustainability expertise is reflected in the inclusion of a sustainability expert in the Audit Committee of the Supervisory Board.

As previously mentioned, both the Executive Board and the Supervisory Board receive regular information and, at the same time, training on sustainability issues. This information transfer and training also takes place as part of a regular series of events entitled "Supervisory Board Special" in which internal and external experts lecture on key topics.

The Supervisory Board plays an important role in ­sustainability reporting. Quarterly and annual reports are presented to the Audit Committee and the full Super­visory Board prior to publication and discussed by the Executive Board and Supervisory Board. The Remuneration Committee is responsible for monitoring the achievement of sustainability targets in connection with remuneration policy, remuneration practices and remuneration-related incentive structures. In addition, the Executive Board provides the Supervisory Board with up-to-date information on ESG issues at every meeting. The content is presented primarily by the Executive Board, if necessary with the support of internal experts. The Supervisory Board is also able to contact internal experts at any time for additional information apart from the scheduled meetings.

Decisions on and principles of remuneration policy at EVN

The principles for the remuneration of the members of EVN's Executive Board (remuneration policy) were approved by the Supervisory Board in accordance with § 78a (1) of the Austrian Stock Corporation Act on 27 September 2023 based on a proposal of the Super­visory Board's Remuneration Committee in keeping with C-Rule 43 of the ACGC. These principles have remained in effect since the passing of a resolution by EVN's 95th Annual General Meeting on 1 February 2024. In accordance with § 78a (1) of the Austrian Stock ­Corporation Act, the remuneration policy must be presented to the Annual General Meeting at least every fourth year for voting. The remuneration is established annually by the Annual General Meeting.

The Remuneration Committee defines the financial and non-financial targets for the Executive Board members as part of the remuneration policy each year. It evaluates the results of business activities after the end of the financial year and establishes the target achievement for the financial and non-financial goals. The achievement for the financial and ESG targets requires the prior approval of the annual financial statements, whereby the Remuneration Committee reviews, or arranges for a review of, the correct calculation of the relevant ­metrics in advance. Based on this information, the ­Remuneration Committee defines the target achievement and the amount of payment, subject to the formal approval of the annual financial statements by the Supervisory Board and informs the members of the ­E xecutive Board ­accordingly.

Remuneration policy for the members ­of the Executive Board

The remuneration for the members of the Executive Board includes both fixed and variable components. The fixed remuneration components are independent of performance and consist of a base salary, remuneration in kind and ancillary benefits as well as a pension serviced by an external pension fund.

The variable remuneration components are dependent on performance and consist of long-term financial ­targets that are measured on the basis of multi-year performance criteria. Also included are ESG targets with single or multi-­year goals as well as individual targets with one-year performance criteria. The Long Term Account (LTA), which covers the achievement of financial and ESG targets, ­creates the basis for a long-term review period. Moreover, the remuneration policy includes malus and clawback rules.

The Remuneration Committee sets the financial targets for a period of four years in advance to uncouple the annual corporate planning process from the variable remuneration system and, in particular, to strengthen the concentration on medium- and long-term strategic goals and opportunities. The concrete ESG goals can be determined annually based on the company's long-term targets. The purpose of the four-year planning horizon is to focus the targets in the remuneration ­policy on medium- and long-term corporate goals and, through the multi-period nature of variable ­remuneration, to support sustainable management over a ­number of years. This four-year period reflects ­standard market practice.

The targets are derived on the basis of internal ­corporate data and information as well as external sources, above all peer group comparisons or capital market and rating agency evaluations.

To strengthen the sustainable development of the EVN Group, the Remuneration Committee also defines quantitatively measurable ESG targets for the variable remuneration components which are based on the sustainability strategy presented in the full report. These targets can be defined for a single year or for a multi-­year period. The decisive criteria catalogue ­covers the following subject areas, whereby at least three targets must be included:

Sustainability strategy – targets

Environment

Social

Governance

At the Executive Board level, 15% of variable remuneration is linked to ESG targets. The Long Term Account transfers the variable remuneration from the achievement of the financial and ESG targets in a particular period into an aliquot annual payment by releasing 50% of the Long Term Account in the first year after expiration of the financial year on which the entitlement is based. The remaining 50% are carried forward to the following periods.

Remuneration policy for the members of the Supervisory Board

The shareholder representatives on the Supervisory Board receive fixed annual base remuneration and a fixed attendance fee per meeting, but do not receive any variable or any ESG-based remuneration.

The amount of the basic remuneration for the Super­visory Board members can be measured differently for factual reasons, in particular the respective functions (e. g. chairperson, vice-chairperson, chair or membership in committees). The attendance fees reflect the fact that the ­number of meetings and the related time spent, especially in connection with committee memberships, can vary.

The employee representatives on the Supervisory Board exercise their functions in accordance with § 110 (3) of the Austrian Labour Constitutional Act in an honorary capacity and do not receive any remuneration and also no ESG-dependent remuneration.

Business areas

EVN's headquarters are located in Lower Austria, ­further core markets are Bulgaria and North Macedonia. In total, EVN was active in 13 countries during the 2023/24 financial year.

Energy

Our integrated business model covers the entire value chain:

• Energy generation • Operation of distribution networks • Supply of electricity, natural gas and heat to end customers (with ­different focal points in our individual markets)

Environmental services

The environmental services business covers the following activities:

• Drinking water supplies in Lower ­Austria • For the international project business further strategic options are under evaluation consistent with EVN's focus on the core energy business following the termination of the process for the complete sale of WTE in April 2024.

Investments

Investments in areas related to the core business supplement and hedge our value chain:

• Verbund AG (12.63%) • Burgenland Holding (73.63%), which, in turn, holds 49.0% of ­Burgenland Energie • RAG (50.03%)

Markets and business areas

Austria

• Generation: electricity, heat, thermal waste utilisation • Network operations: electricity, natural gas, heat, internet, telecommunications • Energy supplies: electricity, natural gas, heat • Environmental services business: drinking water supplies

Germany

• Generation: electricity • Energy supplies: electricity • Environmental services business: drinking water supplies and wastewater treatment, thermal sludge utilisation

Croatia

• Network operations: natural gas • Energy supplies: natural gas • Environmental services business: wastewater treatment

North Macedonia

• Generation: electricity • Network operations: electricity • Energy supplies: electricity

Bulgaria

• Generation: electricity, heat • Network operations: electricity, heat • Energy supplies: electricity, heat

Albania

• Generation: electricity

Other countries

• International project business: WTE is responsible for the construction and operation of plants for drinking water supplies, wastewater treatment and thermal waste and sludge utilisation in Germany, Poland, Romania, Slovenia, Croatia, North Macedonia, Cyprus, Bahrain and Kuwait.

Key data

Employees: 8,006 (International: 4,894, National: 3,112)

Networks: 155,853 km total

• Electricity: 140,909 km
• Natural gas: 13,966 km
• Heat: 978 km

Electricity generation: 3.3 TWh (84.4% Renewable, 15.6% Thermal)

Energy sales volumes: 22.3 TWh

Customers: 4.9m

• Electricity: 3.6m
• Natural gas: 0.3m
• Drinking water: 0.6m
• Heat: 0.1m
• Internet and telecommunications: 0.3m

Description of material business activities

Electricity generation

The focus for electricity generation reflects our ­Strategy 2030 and lies on the further expansion of renewable generation capacity, especially in the areas of wind power and photovoltaics. Based on our currently operational renewable plants – hydropower and wind power, photovoltaics and biomass – the share of renewable generation will continue to increase in the future.

We have significantly reduced our conventional energy production in recent years as part of our decarbonisation ambitions. The current thermal capacity of 470 MW in the Theiss power plant serves solely as a reserve for the transmission network operator APG. Consequently, this power plant only generates electricity when called on by APG for network stabilisation.

Electricity network infrastructure

Our electricity distribution networks and the smooth operation of the technically complex infrastructure form the basis for reliable supplies to our customers. EVN acts as the distribution network operator for electricity in Lower Austria, Bulgaria and North Macedonia.

The integration of electricity from renewable sources, which is delivered from a growing number of decentralised plants, and the related changing and volatile energy flows represent a growing challenge for our networks.

Changing consumption patterns driven primarily by heat pumps and e-mobility as well as more intensive interaction with customers who generate electricity or are part of an energy community are making network planning, management and operations more complicated. In the end, our networks must also be able to meet these users' needs when there is no local energy generation.

The energy transformation has turned the network ­infrastructure into a data hub for the energy future and made intelligent networks the backbone of our future electricity system. Innovative solutions and continuous investments are required to maintain the same high­quality performance. The massive expansion, ongoing modernisation and digitalisation of this infrastructure is a necessity – including high-voltage power lines, transformer stations and medium-voltage capacity as well as substations, local networks and smart meters. To support the energy transformation, we plan to invest roughly EUR 3bn alone in our network infrastructure in Lower Austria by 2030. Our focus for the low- and ­medium-voltage levels is on digitalisation and sensor technology. Therefore, more than 98% of all equipment in the Netz Niederösterreich supply area was equipped with smart meters as of 30 September 2024.

Natural gas

The EVN Group operates natural gas distribution ­networks in Lower Austria and in four counties in ­Croatia. Against the backdrop of the decarbonisation trend in the energy business, we are concentrating ­primarily on maintenance and repairs in this area to ensure safe power line operations. Our network ­investments have also already turned to preparations for the future transport of hydrogen.

Our long-term contracts for natural gas storage facilities ensure uninterrupted supplies, especially during periods with temperature-related higher consumption or possible shortages at the European level (e. g. due to political crises in transit or origin countries). This strategy has proven to be very successful, especially in the challenging environment that has characterised the energy ­market in recent years, and enables us to remain a ­reliable partner for our customers.

Our stake in RAG – with its focus, above all, on the ­natural gas storage business – has high strategic importance in this context. In the development of hydrogen technologies and green natural gas, RAG is seen as a pioneer for the branch due to successful pilot projects and is therefore also a key element in our strategy for the future renewable energy system.

Energy supply

­E VN supplies energy to end customers in Austria, Bulgaria and North Macedonia. In Austria, this takes place within the framework of EnergieAllianz through the equity accounted supply company EVN KG. In Bulgaria and North Macedonia, EVN also has separate companies that cover the liberalised and regulated market segments.

District heating

According to the Renewable Energy Expansion Act, district heating will make a significant contribution to meeting Austrian and European climate goals through expansion and decarbonisation in Austria. The use of renewable energy in the heating business has played an important role at EVN for many years. As the largest natural heat supplier in Austria, we currently operate more than 80 biomass district heating plants and ­biomass-based combined heat and power plants in Lower Austria. Three large cross-regional district heating transport pipelines – including the longest such line in Austria from the energy hub in Dürnrohr to St. Pölten (32 km) – as well as four natural cooling plants complete our extensive natural heating infrastructure. We are currently working on the construction of a new biomass combined heat and power plant in St. Pölten, which will be the fifth of this type for EVN.

Our biomass plants with a capacity of 20 MW or more only operate with biomass certified as sustainable under RED II.

The use of renewable energy will also lead to further changes in the heating sector. EVN has already become Austria's leading provider of natural heat and uses regional biomass for its production. We are continuously expanding our natural heat portfolio by consolidating district heating networks and expanding our generation capacity. In St. Pölten, we are currently constructing our fifth biomass combined heat and power plant and, at the energy hub in Theiss, we are pursuing new and innovative approaches. We have a warm water storage facility and a power-2-heat plant at that location. When we operate this plant with surplus electricity from solar power, we can produce and store warm water and thereby save biomass for the winter half of the year. Our plans include the increasing use of these power-2-heat ­systems for district heating supplies in the future because we can then use renewably produced ­electricity across sectors.

Drinking water

Demographic trends in our supply area as well as ­changing climatic conditions are responsible for a ­continuous increase in the demand for drinking water. In addition to the ongoing operation of numerous local networks that are supplied by EVN Wasser with drinking water, connecting water-rich and water-poor areas via cross-regional transport pipelines represents a particular challenge. This pipeline network is fed by well fields and high-level tanks throughout Lower Austria. In order to offset a climate-related decline in precipitation or regional breakdowns, we must construct new pipelines, improve the performance of our current network and develop new well fields.

The responsible use of drinking water involves new pipeline construction as well as the upgrading of the existing infrastructure – primarily through the identification and repair of leaks and the protection or improvement of the water quality while minimising the negative impact on the environment. One good example is the construction of natural filter plants to improve quality through the physical softening of water. Magnesium, calcium and other trace substances are dissolved and removed from the water with the help of modern ­technologies and without the use of chemicals.

Internet and telecommunication services

Sufficiently dimensioned, high-quality networks and technical infrastructure also form the basis for the ­reliable flow of data in this business. The high-perform­ance network operated by kabelplus offers digital cable television in HD, and partially also in UHD quality. The use of modern glass fibre technology, which is the focus of continuous expansion, also supports ­internet usage with upload and download speeds in the Gigabit range.

E-mobility

In the area of e-mobility EVN has positioned itself as a leading provider for charging infrastructure – not only for cars but also for trucks, buses and even ships. We had over 3,000 charging points in operation as of 30 September 2024. More than 20,000 fuel cards have already been issued for customers, which can be used throughout Austria based on joint roaming agreements. Further growth is expected, especially in the public sphere, and EVN is currently installing a charging infrastructure on the parking areas of two large supermarket chains. We have also started to develop an e-charging infrastructure in Bulgaria and North Macedonia.

Strategy 2030: More sustainable. More digital. More efficient.

The future-oriented development of our corporate ­strategy started in 2019/20 with a Group-wide process by EVN's management in close coordination with the Supervisory Board. The time horizon is focused on 2030.

Our strategy process was significantly influenced by the international frameworks applicable to the energy sector. Included here are the Sustainable Development Goals of the United Nations and the goals of global and European energy and climate policy (e. g. the Paris Climate Agreement and European Green Deal). These goals and policies are leading, in part, to massive changes in the framework and in the legal and regulatory requirements on energy providers. The determining change for our ­industry – and a central factor for our strategy – is the result of social and political efforts to achieve the ­fastest possible transition to a functioning renewable energy system in order to minimise sector-specific ­climate effects faster and even more clearly. It is also reflected in the inclusion of our major stakeholders' central ­concerns in the ­strategy process. Our answer to these developments is the EVN Climate Initiative, which is based on the Strategy 2030. It links relevant objectives, like the decarbonisation goals coordinated with the Science Based Targets initiative, with EVN's overall ­strategy.

The development of many basic market and environmental factors is connected with uncertainty. Our ­strategy process therefore includes sensitivity and ­scenario analyses to support reliable conclusions for the identification of concrete measures. We also ­continuously monitor energy sector conditions and ­regularly discuss developments, including deviations from plan assumptions and their effects, at the management level – for example, at the quarterly ­segment steering committee meetings where the ­members of the Executive Board and ­managers exchange information with internal experts. The ­E xecutive Board then regularly discusses the ­aggregated findings with the Supervisory Board.

Our core strategies for 2030

1) Enabling a renewable energy system

• We are committed to making a significant ­contribution to meeting Austrian and European climate goals. • This commitment is underscored by the ­preparation of a 1.5°C transition plan. • A central measure for the attainment of our goals is the expansion of our renewable generation capacity in our core markets of Lower ­Austria, Bulgaria and North Macedonia, especially in the areas of wind power and ­photovoltaics. Plans ­call for an increase in our annual ­renewable electricity production to roughly 3.8 TWh by 2030. • The increasing surplus production from renewable generation requires innovative approaches for the efficient cross-sector use of energy. We are actively working on initiatives that will allow green electricity to also support decarbonisation in other areas like the heat and transport sectors. For this purpose, we are investing in the expansion of the e-charging infrastructure and in the increased use of heat pumps. • In addition to sector coupling, we are working on projects to store the surplus production from renewable energy. Concrete projects involve the operation of large battery storage systems and the generation and storage of green hydrogen.

2) Network expansion for a renewable energy future

• An efficient, high-performance and digital ­electricity network infrastructure is the ­requirement for an CO2 -free energy system. The steadily increasing feed-in of wind and solar electricity combined with changes in ­consumption behaviour – above all, through e-mobility and the transformation of the ­heating sector – require substantial expansion in our network areas. We are therefore realising an ambitious investment programme in the coming years. It covers the installation of ­additional power lines at all voltage levels as well as the construction of ­further transformer stations and substations. • In addition to these construction projects, we are increasing our focus on digitalisation. The ­use of smart technologies and applications in network operations optimises load management as well as the feed-in and use of green electricity, above all during production peaks. Intelligent digital network controls will allow us to optimise the necessary hardware investments. • The infrastructure previously used for natural gas is being prepared for the future transport of hydrogen and renewable gas.

3) Digital offerings for customers

• The transformation of the energy system is changing the roles and behaviour of our ­customers. Private electricity generation with photovoltaic equipment and separate storage batteries, heat pumps and e-charging stations are converting electricity customers into active participants on the energy market. • Our claim is to support these developments with special services and offerings as a way of meeting the changing needs of our customers. Based on our expertise in the energy sector, we are also developing software solutions and applications that will allow our customers to easily and reliably participate in the energy market, for example through energy communities. • EVN's strategy for all customer groups involves the consequent digitalisation of our marketing processes to make internal operations more efficient and thereby continuously improve the service quality and offering for our customers.

4) Reliable drinking water supplies

• As in the energy business, the highest possible claims for supply security and quality also apply to our drinking water business in Lower Austria. Developments like the increase in water consumption due to demographic changes and the rising number of weather-related consumption peaks make additional investments in drinking water supplies unavoidable in the coming years. • These investments will focus on the expansion of cross-regional pipeline networks and capacity increases in the pump plants. These measures will guarantee that sufficient water resources can be distributed as efficiently as possible into all regions of our supply area. • We are also investing continuously in the improvement of the water quality. For this purpose, we are constructing natural filter plants that soften and purify the water physically with membrane technology – in other words, without the use of chemicals.

5) Solutions for the circular economy

• EVN operates a modern, ecologically optimised thermal waste utilisation plant in Lower Austria. The energy gained from waste incineration is used to generate electricity and district heat. • Based on our know-how and our many years of experience in thermal waste utilisation, we also operate thermal sewage sludge utilisation plants that generate electricity and district heat. • This knowledge is flowing into our evaluations for the construction of a further plant for the thermal treatment of sewage sludge, whereby we plan to recover phosphorous from the sewage sludge.

Supply security as our top priority

The infrastructure provided and operated by EVN creates the foundation for reliable supplies and the smooth functioning of society and the economy. Consequently, supply security has always been our central goal and our promise to our customers. This promise also determines our investment programme, which is directed primarily to network investments.

The central parameters for the quality of our network infrastructure are network losses and the indicators for power interruption. In Lower Austria, network losses have remained stable for many years at roughly 4%, which is a very low level in international comparison. A direct comparison with our supply areas in Bulgaria and North Macedonia is not possible due to the different customer and network structures. As the indicators in these two South Eastern European markets are higher, our investment programmes in these markets concentrate on the further reduction of network losses and the continuous improvement of efficiency. We have successfully reduced our network losses in Bulgaria from approximately 20% at the time of our market entry in 2004/05 to a recent level of 5.8% and from approximately 25% in 2005/06 to currently 14.5% in North ­Macedonia.

The reliability of our electricity supplies is also confirmed by externally calculated indicators such as SAIFI (System Average Interruption Frequency Index) and SAIDI (System Average Interruption Duration Index). They have confirmed our company's constantly reliable supply performance in Lower Austria for many years. Information is currently not provided on the respective indicators for our South East European markets in Bulgaria and North Macedonia due to the lack of an appropriate database.

SAIFI in the 2023 calendar year: 0.84 ­(previous year: 0.86)

That means an EVN customer was affected by an average of one unplanned power interruption in 2023.

SAIDI in the 2023 calendar year: 26.21 minutes (previous year: 17.19 minutes)

The SAIDI was again clearly below the ­Austrian average of 61.03 minutes (­previous year: 39.36 minutes).

EVN places high value on a regular, proactive and open dialogue with all stakeholders. The overriding principle in this context is to create and maintain an appropriate and equitable balance between the diverse concerns shared with us by our stakeholder groups. We are convinced that the social acceptance of our work is a basic requirement for EVN's sustainable, long-term ­success and positive perception by the public.

We therefore rely on an institutionalised exchange at all hierarchy levels and in formats tailored to the respective target groups. This communication takes place at regular scheduled meetings or as required. In this way, we want to ensure the structured and timely identification and management of our stakeholders' concerns.

EVN's stakeholders and the type of involvement

Various organisational processes ensure that the ­E xecutive Board is informed of important feedback from stakeholders. The quarterly steering committee meetings, which cover all segments as well as sustainability and public affairs, and the project steering ­committees are used for this purpose. These committees include the Executive Board as well as management ­from the respective areas.

Due diligence audits based on ecological and social aspects are integrated in the early phase of construction projects. They cover internal decisions as well as project approval by the Executive Board or – for larger projects – approval by the Supervisory Board.

In addition to the continuous exchange with internal experts, our Executive Board and Supervisory Board can draw on several advisory boards in which external experts from various disciplines contribute their expertise and outside perspectives on ESG issues: the Sustainability Advisory Board, the EVN Social Advisory Board and the EVN Art Advisory Board.

We carried out an online survey during 2023 in preparation for the CSRD to identify and synchronise the ­viewpoints of stakeholders with the material impacts.

Identification and assessment of material impacts, risks and opportunities

The sustainability reports previously published by EVN were focused on the materiality analysis concept defined by the Global Reporting Initiative (GRI) as a means of identifying and assessing material impacts, risks and opportunities. In consideration of the interests of various internal and external stakeholders, we identified and evaluated the topics (previously described as "areas of activity") that have the greatest importance for our stakeholders and, at the same time, the greatest economic, ecological and/or social impacts on our business activities. This structured process was repeated and updated in a three-year cycle.

In preparation for mandatory application of the CSRD, we carried out a double materiality analysis for the ­current reporting period based on ESRS requirements, updated our risk inventory and integrated it with double materiality requirements. The material topics were also aligned with the ESRS terminology, and the previously used company-specific definition of the "areas of ­activity" was discontinued.

In accordance with the requirements of the Sustainability and Diversity Improvement Act and the EU Taxonomy Regulation, we also carry out an annual risk inventory to identify potential risks and the related impacts of EVN's business activities and business relations on environmental, social and employee-related issues, the observance of human rights and the fight against corruption. Also included here is an assessment of the resulting financial impact on the EVN Group.

ESG risk management process

The primary objectives of the ESG risk management process are the targeted assessment of existing and potential impacts of EVN's business activities on mankind and society (impact materiality) as well as the ­identification and assessment of gross risks and opportunities (financial materiality), above all in a sustainability context. This identification takes place each year as part of the annual risk inventory by the centrally organised risk management with the support of the innovation and sustainability corporate function and EVN's ESG organisation.

A clearly structured process was defined for the identification and analysis of impacts, opportunities and risks and the development of suitable countermeasures. Through the involvement of the management and ­E xecutive Board levels, EVN ensures that the results and findings from the risk inventory and the related double materiality analysis are presented and discussed by the ESG risk working group and, subsequently, by the Group Risk Committee.

The identification and assessment of impacts, risks and opportunities generally reflects EVN's risk management process and includes the following steps:

• Identification: An ESG risk catalogue was prepared in accordance with ESRS requirements and the previously identified, sustainability-related risk positions. This catalogue is evaluated and updated annually and, together with the material impacts, risks and opportunities, is formally released by the ESG risk working committee.

• Assessment and analysis: Qualitative and quantitative assessment of the various potential impacts, risks and opportunities by the responsible risk officers in the corporate and decentralised business units of the EVN Group.

– Risks/opportunities: The assessment is structured by time horizon (short, medium and long term) based on a five-step scale for the dimensions "probability of occurrence" and "impact on cash flow".

– Impacts: The assessment is structured by time horizon (short, medium and long term) based on a five-step scale for the dimensions "probability of occurrence" and "degree of severity". It also includes the following factors required by the CSRD: "scale", "scope" and "irremediable character of the impact". Assessments concerning ­possible negative impacts on human rights are also included.

• Reporting: Discussion of the identified impacts, risks and opportunities by the ESG risk working ­committee and subsequently by the Group Risk ­Committee; if necessary, implementation of control measures; reporting to the Audit Committee; ­presentation of the material impacts, risks and opportunities in EVN's sustainability statement.

In advance of the ESG risk inventory for 2023/24, we aligned the material impacts, risks and opportunities with the interests and viewpoints of EVN's various ­stakeholder groups and included the results in the ESG risk catalogue. This took place as part of an online ­stakeholder survey that was carried out in 2023, also in connection with preparations for the CSRD.

Analysis of climate risks

EVN has conducted a standardised annual process since the 2021/22 financial year to analyse potential climate risks and their impact on its business model as part of its activities to implement the EU Taxonomy Regulation. Scenarios are used to identify and assess potential climate risks for the years up to 2100. Physical risks involve events and changes with direct climatic causes. One example of chronic climate risk is the expected, longterm increase in global warming. Higher temperatures can have a negative impact on EVN's plants. Acute risks, in contrast, include storms, heavy rainfall or flooding. All these factors must be included in the design of plants and infrastructure.

We do not only identify climate-related fluctuations in our earnings as part of our risk management, but also evaluate potential quantitative impacts during the planning process with sensitivity and scenario analyses. ­Comparable issues also influence the selection of scenarios for the future development of energy and primary energy prices. This information forms the basis for discussions on climate change and its impacts on our business activities at the management, Executive Board and Supervisory Board levels.

Damages caused by extreme weather events represent a threat to supply security. In a broader sustainability context, the risks in this area also include supply interruptions or physical dangers to people caused by explosions or accidents. In order to ensure trouble-free operations and the technical security of our power plants – ­both of which are essential to protect reliable supplies – we conduct regular inspections and maintenance work that also involves scheduled downtime. We measure and monitor actual interruptions in network electricity supplies with the System Average Interruption Frequency Index (SAIFI) – which shows the mean supply interruption – and the System Average Interruption Duration Index (SAIDI) – which shows the average ­annualised duration of unplanned power interruptions.

Occupational safety and accident prevention are also prominent issues in all our business units. We guarantee the required high level of safety, above all, through training and by raising employees' awareness. In addition to legal requirements, we have developed an extensive set of internal rules, directives and guidelines. All work accidents in the EVN Group are recorded and analysed centrally by the occupational safety department.

E5-4 Resource inflows

EVN's business activities as a whole and, above all, the investment focal points on network infrastructure, renewable generation and drinking water supplies require intensive cooperation with construction firms, plant, pipeline and cable line construction companies as well as suppliers of electro-technical equipment and components, pipes, transmission and cable lines, meters, hardware, software and work clothing.

These resource inflows can be allocated to the following areas:

• Renewable energy technologies: wind power plants, hydropower plants, photovoltaics, biomass plants
• Thermal energy generation plants: all plants/plant components, materials and supplies required for the operation of existing equipment and for their new construction
• Energy carriers: natural gas, heating oil, fuels, biomass, waste
• Network infrastructure: all plants and equipment required for the operation of electricity, natural gas, heat, internet and telecommunications networks including, for example, cables, pipes, electrical and electronic equipment, materials and supplies
• Drinking water supplies and wastewater disposal: all plants and equipment, materials and supplies required for the operation of existing drinking water preparation and wastewater treatment plants and for the new construction of such plants

Critical raw materials and rare earths are found, above all, in wind power plants, photovoltaics, information and communication technology products and network infrastructure. Most of these products are delivered in packaging materials made of plastics, cardboard or wood.

Use of materials and other supplies – used in energy generation, drinking water preparation, wastewater treatment, waste utilisation plants

¹ The materials and supplies used were calculated on the basis of procurement and inventory amounts.

² Adjustment of the values from 2022/23 to reflect the scope of consolidation in 2023/24.

Waste

Hazardous Waste

EVN reported 18,425 tonnes of hazardous waste in 2023/24, compared to 16,612 tonnes in the previous year (an increase of 10.9%).

Waste from Thermal Waste Utilisation

The thermal waste utilisation plant in Dürnrohr processes approximately 550,000 tonnes of waste annually. The recovered materials include:

These materials are recycled as secondary raw materials.

Notes on Reporting

Due to a change in calculation methodology, the hazardous waste value for 2022/23 was adjusted. No comparable value is available for 2020/21. In line with CSRD requirements, emissions from companies over which EVN exercises operational control are included in reporting.