History of sustainability
We are one of Europe's leading operators in the integrated management and construction of gas infrastructure in terms of regulatory asset base
Snam renews its commitment to decarbonisation and energy transition by presenting the new 2021-2025 Strategic Plan and the 2030 Vision, which see significant investments in the biomethane and hydrogen businesses, aiming to achieve carbon neutrality by 2040 in its activities and setting targets to reduce emissions from its value chain (Scope 3 emissions) by 2030.
Besides, Snam wins the 2021 Oscar di Bilancio for the 2020 Annual Report and is included in the DJSI. Snam adds its purpose “Energy to inspire the world” in its Bylaw.
2020 represented for Snam a year of opportunities and challenges, which the Group has been able to seize and address by strengthening the decarbonization process through activities and projects concerning sustainability.
2020 is the year in which Snam declared its Net zero strategy to 2040 and the importance that the fight against climate change represents for the Company is also evidenced by the publishing of the first Climate Action Bond Report containing information relevant to investors including the framework used by Snam and the processes adopted to evaluate and select projects, as well as case studies of the activities selected by Snam. These activities were followed by the very successful issues of three Transition bonds, which will be destined for Eligible Projects, projects in the energy transition, whose selection criteria are indicated in the Group's Transition Bond Framework published in June.
In addition, Snam, as a founding member of the CFO Taskforce, established as part of the Global Compact, contributed to the publication of the SDGs-related Finance and Investment Guidelines containing the first integrated and UN-backed investment and finance principles aimed at guiding companies in aligning their sustainability commitments with corporate finance strategies in order to create a significant impact on SDGs.
Finally, compared to the "sustainable loan", Snam obtained, for the second consecutive year, confirmation of the reduction of 2.5 bps in the cost of this loan in the face of the achievement of the objectives related to parameters of social and environmental sustainability.
Besides, Cassa Depositi e Prestiti and Snam announced the foundation of Arbolia, a benefit company born for the development of afforestation and CO2 absorption projects in Italian cities, to be carried out also with the involvement of companies and private citizens who wish to contribute to the protection of the environment. The benefit company's goal is to plant 3 million new trees by 2030, to absorb about 200 thousand tons of CO2.
In 2019 Snam was the first European company to introduce a mix of hydrogen (first 5% and then 10% in volume) and natural gas into its transmission network with a direct supply to two industrial consumers. The Company strongly believes in the potential of this energy source - especially green hydrogen obtained through the electrolysis of water from renewable sources such as solar and wind-power, without CO² emissions - in the global context of the fight to combat climate change. The introduction test, carried out successfully in a section of the network at Contursi Terme (Salerno), confirmed the suitability of Snam's assets to receive increasing quantities of hydrogen.
Regarding biomethane, in 2019 Snam increased its acquisitions portfolio thanks to the subsidiary Snam 4 Environment, identifying Renerwaste, one of the leading companies active in Italy in biogas and biomethane infrastructure, which currently operates at three plants and has permission to build two additional ones. In 2019, Snam also signed a binding letter of intent aimed at launching a strategic partnership in infrastructure for biomethane from agriculture through the entry, with a 50% stake, into Iniziative Biometano, a company operating in Italy with five biogas plants, for which there is a plan for conversion to biomethane, and with various plants in the process of authorisation or construction.
Lastly, looking abroad as well, Snam has signed a memorandum of understanding with Infore Environmental Group, an environmental services company listed on the Shanghai Stock Exchange, for potential joint initiatives for the development of biogas and biomethane infrastructure in China.
In March 2018, Snam re-launched its brand identity, renewing the logo and values. In 2018, growth in the core business of regulated activities continued, also involving the December acquisition, through a European consortium, of DESFA, the Greek national natural gas infrastructures operator. With reference to the energy transition, Snam has completed investments in the development of new businesses aimed at fostering decarbonisation and a better use of energy, in particular in the biomethane segment (IES Biogas and Enersi Sicilia), sustainable mobility (Cubogas) and energy efficiency (TEP Energy Solution).
Snam stipulated important agreements for the development of sustainable mobility, including through the possible development, as part of a partnership, of certain micro--liquefaction plants and agreements in China for the supply of services and evaluation of possible collaborations, in biomethane, in the research and development of renewable gas, in sustainable mobility and in storage.
With the aim of globally optimising the consolidated experience of Snam, under the scope of the activities carried out by the Snam Global Solution business unit, a joint venture with the Albanian infrastructure operator Albgaz was established, aimed at supplying services connected with the operation and maintenance (O&M) of gas pipelines in Albania.
In 2016 Snam separates from gas distribution activities.
Today Snam is the largest gas infrastructure operator in Europe with over 32,500 km of gas pipelines in Italy. To ensure energy security to the country, Snam upgraded its sources of supply and strengthened the Italian and European infrastructure network. In addition to national production, the Italian system receives gas from five sources of import via pipeline and three regasification terminals. Snam is also working to ensure that from 2020 Italy can have a new gas source from the Caspian area through the construction of the Trans Adriatic Pipeline.
With the capital expenditures planned in the next years, Snam pledges to develop and promote the use of gas in its various forms to help fight climate change and air pollution. From the use of liquefied natural gas and compressed natural gas for maritime and ground transportation, to biomethane, a renewable and sustainable energy source, to new technologies for exploiting energy from renewable sources.
In January, Snam changed its corporate structure and applied the Third Energy Package, thus strengthening its specialisation and its independence while also preserving the efficiencies achieved following the acquisitions of Stogit and Italgas in 2009.
The new corporate structure included a corporate with four operating companies, each responsible for the strategies and results. The transmission, dispatching, gas metering and remote control business division was transferred to a new company that took the name of Snam Rete Gas, which was established as an Independent Transmission Operator.
In mid-October, Cassa Depositi e Prestiti (CDP) acquired 30% of Snam’s share capital. The terms and conditions of the separation of ownership of Snam from its main historical shareholder, Eni, were then defined.
In March, Snam Rete Gas – in addition to having been included in the Dow Jones Sustainability World Index in 2010, the most prestigious global stock exchange index for Corporate Social Responsibility – was also awarded the SAM Bronze Class 2011, which recognises the best companies in the Gas Distribution sector.
A project was launched to explore the concept of Shared Value, which aimed to combine the interpretation of sustainability in terms of “value protection” with an approach that focused on “value creation” both for the company and for the communities in which it operates.
Snam Rete Gas was included in the SAM Silver Class 2010 excellence group and was awarded the title of SAM Sector Mover 2010 in the Gas Distribution sector. The company was the recipient of the “Value Creators” award - a category dedicated to large companies - as part of the Milano Finanza Company Awards 2010.
In March, the Board of Directors approved the 2009 Sustainability Report, which for the first time reported on the experiences of all Group companies.
In the autumn, Snam Rete Gas promoted good environmental practice in Italian schools by leading the “Clean up the World” initiative, meeting more than 300 students and opening some of its plants to local residents.
Snam Rete Gas acquired the entire share capital of Stogit, the largest Italian natural gas storage operator, and of Italgas, the main Italian gas distribution company, creating a single integrated operator in the regulated gas sector in Italy, the foremost country in continental Europe in terms of the amount of capital invested for regulatory purposes.
Snam Rete Gas was included in the Dow Jones Sustainability World Index and the ECPI Ethical Index Global , and also received confirmation of its inclusion in the two other indices: “ECPI Ethical Index Euro” and “ECPI Ethical Index EMU.”
The company joined Global Compact, an international initiative launched in July 2000 by the United Nations.
Continuing its commitment to Health, Safety and Environment in place for over a decade, Snam Rete Gas published its first Sustainability Report, which was awarded the 2007 Oscar for Financial Statements (Oscar di Bilancio), an external award sponsored and managed by FERPI.
The 2007 Sustainability Report was the first report to present the vision, strategies, results and commitments with regard to corporate governance, people, environmental protection and relations with the community and the territory, to encourage transparent and constructive dialogue and strengthen relationships with all stakeholders.
Since 2007, the Board of Directors has played a central role in defining sustainability policies and approves the Sustainability Report.
The volume of natural gas injected into the transmission network amounted to approximately 88 billion cubic metres and the gas pipeline network extended over 30,889 km. 64% of installed capacity in the compressor stations was from low-emission gas turbines. The land crossed by 396 km of the gas pipeline network was environmentally restored, 33 km of which was located in natural parks and 52 km in woodlands.
Work that had begun in 2003 to increase imports of natural gas from Russia was completed and several sections of pipeline became operational as part of the project to increase infrastructure capacity to import gas from Algeria through the Transmed pipeline, and from Libya through the new Green Stream pipeline constructed by Eni. The available transmission capacity at import points with foreign interconnections increased by 34%, satisfying all regasification and transport capacity requests from users.
The natural gas transmission and LNG regasification activities performed by Snam Rete Gas provided a source of energy with low environmental impact, which, in 2006, satisfied approximately 36% of Italy’s energy requirements, thus making it possible to increase energy efficiency, reduce atmospheric emissions and contribute to achieving the reduction target set for greenhouse gas emissions as part of the commitments under the Kyoto Protocol
With regard to the improved implementation of the principles of sustainable development, specific organisational structures were established, reporting to the new “Health, Safety, Environment, Sustainability and Technology Department”. The Sustainability Project Team was then formed, involving a cross section of all company departments.
The Nebrodi Park scientific committee approved a project – developed in association with the University of Palermo – to replace the vegetation along the Bronte–Montalbano gas pipeline.
Particular attention was paid to the community and region of Portovenere (La Spezia), where the liquefied natural gas regasification plant is located. Under the scientific and methodological supervision of the Eni Enrico Mattei Foundation, GNL Italia, the Municipality of Portovenere, the Portovenere Natural Reserve and Acam collaborated to create a regional sustainability report, the first of its kind in Italy.
Following the implementation of Emission Trading regulations in Italy, the company defined the roles and responsibilities for managing greenhouse gas (GHG) emissions quotas.
The programme to install 25 new water mist fire-extinguishing systems to replace the NAF-S-III agent used in the fire-extinguishing equipment installed in the compressor units of operating gas compressor stations, which had begun in 1999, was concluded.
During the year, meetings were held with around 100 mayors to present the plans for new pipeline construction projects before applications for permits were submitted.
The Italian Electricity and Gas Authority endorsed Snam Rete Gas’s Network Code, which defined the set of rules for access to and use of the gas transmission service by users.
In October, a “Virtual Trading Point” became operative on Snam Rete Gas’s website, through which the bilateral trading of gas by users on a daily basis was made possible.
On 18 March, Snam Rete Gas shares were included in the MIB30 index and, in September, they were included in the FTSE4Good family of sustainability indices, internationally recognised by the financial community for their importance and influence on the composition of ethical portfolios and benchmarks.
To manage and respond to the new context of the gas market, the various different phases of organisational optimisation were managed and addressed equably in terms of industrial relations and relationships with trade unions, characterised by a climate of participation and collaboration.
At the end of the year, the new gas compressor station in Masera, upgraded from 11 to 33 MW, came into operation as the result of larger quantities of gas imported from Northern Europe. Despite the increase in installed capacity, the environmental impact was minimised through the use of best available technologies.
In December, the Chairman of Snam Rete Gas approved the new health, safety and environment policy.
Rete Gas Italia was established, which later the same year would become Snam Rete Gas. The technological assets and wealth of expertise in the field of natural gas transmission was transferred to the new company, which was listed on the Stock Exchange.
GNL Italia S.p.A. was established, a company wholly owned by Rete Gas Italia S.p.A., to manage the regasification of liquefied natural gas, carried out in Italy by Rete Gas Italia.
The European directive (98/30/EC) governing the liberalisation of the gas market was enacted into Italian law.
Certificates of conformity with the international standard UNI EN ISO 14001 were awarded by DNV Italia (Det Norske Veritas), certifying the environmental management systems of the gas compressor stations and the liquefied natural gas regasification plant in Panigaglia.
In addition, the occupational health and safety management system was upgraded to conform to BS 8800 guidelines.
In 1997, to reduce emissions that cause damage to the ozone layer, Snam Rete Gas began a campaign to replace the Halon and HCFC-based fire extinguishing equipment in its gas compressor stations with alternative, low environmental impact extinguishing equipment.
The upgrading of the liquefied natural gas regasification plant in Panigaglia was completed. The environmental restoration operations were carried out according to designs produced by the School of Landscape Architecture at the University of Genoa, to blend the facility with the surrounding countryside.
The first Environmental Report was published: a voluntary measure adopted to put environmental data in the public domain. From 1995 onwards, these documents were published annually.
A major joint programme was launched with the proposal of plans for a new liquefied natural gas terminal in Monfalcone (GO). A study was produced, the result of dialogue with local residents, associations, economic organisations, trade unions, politicians and institutions, which assessed the environmental, economic and social aspects associated with the proposed construction of the terminal. The project was abandoned one year later following the negative outcome of a referendum held in the local community.
The first new generation of low-emission gas turbines were installed in the gas compressor stations. Specially equipped automatic laboratories were purchased to periodically control atmospheric emissions from the stations.
The expansion of the pipelines to import gas from Russia, Northern Europe and Libya was completed. The Snam gas pipeline network extended over 29,000 km.
In this period, the residential market continued to develop, the thermoelectric sector also gained market share and the industrial segment began to recover.
To increase imports, the Transmed was doubled, and work was performed to upgrade the pipeline for importing gas from Northern Europe, which would enable gas extracted from wells in the North Sea to be imported in addition to that arriving from the Netherlands.
When laying new infrastructure, the aim is to avoid or disturb as little as possible areas of special natural or cultural interest, archaeological areas, geologically unstable areas and inhabited areas, by using technologies that minimise the interference with the surrounding environment. Environmental restoration operations make use of techniques that are increasingly effective and targeted for the specific environmental conditions.
The gas pipeline network stretched across the entire country (with an overall length of approximately 15,000 km) and grew a rate of 800 km per year, reaching 22,400 km in 1989.
The development of the gas pipeline network involved dealing with many obstacles, both natural and manmade, as well as crossing areas of great environmental significance. Gas pipeline routes were chosen from a number of alternatives following environmental impact, transmission safety and technical-economic feasibility considerations.
The completion of the project to import gas from Algeria enabled the gas industry to face into the 1980s ready to sustain further market developments that would strengthen the increasingly important role played by natural gas as the main alternative to oil dependence.
To transport gas from Algeria to Italy, Snam built the unique TRANSMED pipeline (between 1978 and 1983) which runs from Sicily to the Po valley on an epic journey of 1,420 kilometres across the Italian mainland, in addition to over 1,000 kilometres across the sea and other countries.
The first gas from the Siberian gas fields arrived in Sergnano (CR) via the first Russian gas pipeline, after a journey of thousands of kilometres, almost 400 of which were in Italy. The 830 km gas pipeline came into service, allowing gas to be imported from the Groningen gas reservoir in the Netherlands.
The increase in availability, combined with the start-up of imports from the Netherlands, the USSR and Libya, coincided with the first oil crisis, which created favourable conditions for the market penetration of natural gas. National production settled at an average level of 13 billion cubic metres per year, even reaching peaks of just under 16 billion cubic metres in the mid 1970s.
During the same period, consumption doubled, rising from almost 13 to over 27 billion cubic metres per year, with the domestic sector growing significantly, reaching 40% of total gas demand.
The first LNG tankers carrying liquefied natural gas from Libya docked at the jetty of the regasification terminal in Fezzano di Porto Venere.
The pipeline network extended 8,000 kilometres and was increasingly assuming a truly national dimension.
The gas pipeline network extended over 4,600 km.
Construction of the liquefied natural gas receiving and regasification terminal in Fezzano di Porto Venere (SP) was completed.
In the second half of the 1960s, consumption patterns brought demand close to the limit of national production capacity, therefore the decision was taken to turn to the international market and invest in the construction of a plant to regasify liquefied natural gas and pipelines to import gas.
Production exceeded 6 billion cubic metres, helping to bring Italy’s dependence on energy supply from abroad to a record low of close to 50%. These were the economic boom years and new discoveries in the Po Valley, in the off-shore northern Adriatic Sea, the Centre-South and in Sicily made an important contribution to Italy’s development.
The demand for natural gas grew at a rate of 7% per year in this decade, and the resource provided coverage of 10% of energy demand.
The following markets also began to take hold:
- the residential market, where natural gas began to replace manufactured gas in city networks
- the chemicals segment, including for the production of fertilizers.
The network expanded to cover a total of 2,000 km.
Substantial oil and gas reserves were discovered in the Po valley and the real industrial activity of exploration, production, transmission and distribution of natural gas began.
The Ente Nazionale Metano (founded in 1940) along with Agip, Regie Terme di Salsomaggiore and the Società Anonima Utilizzazione e Ricerca Gas Idrocarburati (Surgi) founded the Società Nazionale Metanodotti (Snam) to construct and operate gas pipelines and to sell and distribute gas.
06 May 2022 - 11:56 CEST