E.ON

E.ON displays business model transition leadership by refocusing its entire business model on customer solutions and grid management. Prior to the acquisition of Innogy from RWE in 2019, 4.2 million residential customers used E.ON’s online services, including smart home devices and energy management systems through E.ON Plus. The integration of Innogy’s customer solutions business will expand E.ON’s customer base to around 50 million, giving E.ON large scope to focus fully on its customer solutions business model. E.ON could further improve its leadership in this area by reporting clear growth plans for its customer solutions business.

E.ON is a leader in climate governance. The company’s ‘Partner for the Energy World’ strategy sets out plans for refocusing its entire business model around customer solutions along with grid management to support the low-carbon transition. Decisions within this strategy were informed by E.ON’s own internal scenario, which is benchmarked and complemented by the International Energy Agency’s Sustainable Development Scenario, Germany’s nationally determined contribution and the European Commission’s decarbonisation scenarios. Actions such as the Uniper spin-off and asset swap with RWE represent the implementation of this strategy. In addition, E.ON’s executive remuneration is tied to the successful delivery of the strategy, demonstrating the company’s commitment to this transition.

E.ON is on track to meet its 2050 carbon neutrality target. However, even this level of ambition is not sufficient to align with the company’s pathway required to limit global warming to well below 2 degrees. The time frame of its 2050 target is sufficient to cover the lifetime of all of E.ON’s current and planned assets, which mainly consist of on-site CHP plants for customers. In order to maintain momentum towards this emissions reduction target, E.ON should set intermediate targets, with gaps of no more than five years out to 2050.

E.ON is changing the focus of its entire business model to customer solutions and grid management. The company also plans to become carbon neutral by 2050.

E.ON is delivering on its transition plan through the disinvestment of its fossil assets and an asset swap with RWE. The asset swap saw E.ON release all its renewable generation assets to RWE in exchange for RWE’s stake in the customer solutions provider Innogy.

The asset swap with RWE was finalised in late 2019. The integration of Innogy’s customer solutions services will expand E.ON’s customer base to around 50 million and enable E.ON to focus further on its core business of customer solutions.

In 2016, E.ON spun off its fossil assets into Uniper. Since then, small-scale, on-site CHP plants for customers have increased E.ON’s emissions intensity. However, E.ON’s emissions intensity still remains among the lowest in the sample.

E.ON is committed to delivering on its strategic repositioning of achieving carbon neutrality and is supporting its delivery through executive remuneration. While the company’s emissions intensity remains low, it must acknowledge that even small-scale, on-site plants count towards its scope 1 emissions. Any expansion of generation from these sources will result in an increasing divergence from its low-carbon pathway for emissions intensity.