Østfold Energi, a Norwegian energy producer specializing in hydropower, wind, and heat, is making significant strides toward sustainability. The company generates approximately 2% of Norway's renewable power. As the EU Taxonomy is set to come into effect in 2026, Østfold Energi is taking proactive measures by voluntarily reporting in 2025 for the financial year of 2024. This initiative aims to streamline their processes and ensure compliance well ahead of the deadline.

Navigating the EU taxonomy

Bengt Petter Johansen, finance manager at Østfold Energi, noted that compared to larger energy production companies, they initially felt overwhelmed by the new legislation. “When we got started, we realized how much information was required. We decided early on that we didn’t want to hand this out to consultants but handle it in-house,” Johansen explained. This decision led them to recognize the need for a software solution tailored to their specific requirements.

The complexity of the EU Taxonomy presented challenges for Østfold Energi, as they found the regulation somewhat confusing. However, the software they adopted provided the necessary clarity and guidance. “Celsia did this very well; it was structured and intuitive,” Johansen stated. The software streamlined their reporting process, allowing the team to take charge of their compliance efforts without excessive reliance on external consultants.

Running a pilot program

To kick off their compliance efforts, Østfold Energi implemented a pilot program. “Through the screening criteria set for the initiatives we established in the pilot, we gained a clear understanding of what we were lacking regarding various environmental goals,” Johansen noted.

A significant outcome of the pilot was realizing the importance of conducting climate risk analyses for each initiative. “We had a climate risk analysis but hadn’t applied it to each specific initiative,” he explained. This experience not only enhanced their internal knowledge but also equipped them to meet the various environmental goals outlined in the EU Taxonomy.  

The pilot program also provided invaluable insights, allowing the team to effectively address the sustainable use of water and marine resources alongside various environmental goals. As a result, Østfold Energi has focused on improving its water management practices.

Challenges in supply chain

As Østfold Energi advances its sustainability efforts, they’ve also faced challenges related to minimum social safeguards within its supply chain. “There can be challenges in certain countries, particularly in the area of production,” Johansen remarked. This has raised critical questions about how to ensure ethical practices throughout their supply chain.

Despite the complexities, Østfold Energi remains committed to enhancing its sustainability practices. “It’s a significant undertaking, but it allows us to learn and elevate our internal processes,” Johansen said.

Demonstrating sustainability

Sustainability is at the heart of Østfold Energi’s strategy. “Even though we feel that we are sustainable and engage in new renewable production, we now have to prove it,” Johansen emphasized. This shift represents a new challenge for the energy sector, as they must go beyond claims of being "green" and substantiate their practices.

Johansen expressed concern over scrutiny from those outside the Norwegian energy sector. “We need to go the extra mile and properly document our efforts to ensure there are no questions raised about our industry,” he stated.

Top-Level Commitment

To ensure that sustainability initiatives are taken seriously, Østfold Energi is anchoring these efforts at the highest levels of the organization. “We have several parallel projects underway, including a dedicated CSRD group and a separate climate risk and analysis group,” Johansen noted.

The involvement of top management is critical, particularly as new regulations require sustainability competencies in the boardroom. “This is now as important as the financial figures,” he explained. By fostering a culture of sustainability at the highest levels, Østfold Energi aims to integrate these values into its overall business strategy.

Streamlining Processes

Reflecting on the role of the software provider, Johansen praised Celsia for its effectiveness. “The system works well and streamlines our processes. Once we find the correct screening criteria, everything is laid out clearly,” he stated. The solution provided a clear path for their team, allowing them to be in the driver’s seat and building internal expertise.  

The automatic integration of updates into the software has alleviated some of the pressure on their limited resources, enabling the team to focus on compliance without getting bogged down by constant regulatory changes.

Laying the groundwork for Norwegian energy production

Østfold Energi’s proactive approach to preparing for the EU Taxonomy exemplifies their commitment to sustainability and leadership in the renewable energy sector. By investing in internal expertise, utilizing effective software solutions, and engaging top management, they are setting a strong foundation for a sustainable future in Norwegian energy production.

As they continue to navigate the complexities of the regulatory landscape, Østfold Energi remains dedicated to refining their practices and demonstrating their commitment to sustainability, not only for compliance but as a core aspect of their identity.

Celsia is pleased to support Østfold Energi in their EU Taxonomy reporting effort!