Sustainability Update 2022

A word from our CEO

As a leading provider of industrial technology solutions, EnerSys is committed to delivering energy systems and power-related products and services that meet the growing demand for energy efficiency, resiliency, and sustainability. We strive for continuous improvement in employee engagement, supplier relationships, customer experience, and product innovation to drive our company's overall strategy and future success.

We are making a positive impact on the communities we serve and provide accessible power to people around the world by meeting our customer's needs for critical energy storage solutions. The reliability and resilience of our products means they can be found on all seven continents, including Antarctica as well as in outer space, millions of miles from the closest service technician. We are constantly working to innovate our battery and energy storage solutions, create a safe and inclusive workplace, and ensure the sustainability of our company. This includes being an industry leader in Environmental, Social and Governance (ESG) issues and making consistent progress towards our sustainability goals.

2022 presented many environmental and social challenges, particularly in Europe. Russia's aggression in Ukraine resulted in the senseless loss of innocent lives and increased energy prices. In response, we immediately suspended our operations in Russia and prioritized the safety of our employees. Facing these challenges increased our passion to achieve the ESG goals we set in this past year. We have also increased employee engagement through Town Hall Meetings, strengthened local relationships by partnering with community philanthropy organizations, and transformed our products to improve efficiency and reduce environmental impact. We have also focused on improving efficiency and minimizing the environmental footprint of our own operations – with some notable success. Globally we reduced our absolute Scope 1 and Scope 2 greenhouse gas emissions by over 4%, including a 7.6% reduction in Scope 1 emissions. Since 2019, our Scope 1 emissions are down by more than 24% marking considerable progress toward our 2040 neutrality goal. Not only is this a plus for the planet, but also for our economic sustainability as energy prices increase. Moreover, while our production of energy storage increased by approximately 3%, our total energy consumption fell by 1%, effectively decoupling our growth from energy use in 2022. Similarly, we now use over 2% less water per kilowatt hour of storage produced since 2020. Thus, not only do our products contribute to the decarbonization of our economy, our customers and other stakeholders can also be proud that the amount of resources to create them is also shrinking.

As the world moves towards renewable energy sources, there will be an increased need for reliable and sustainable energy storage technologies. With renewable energy generation capacity growing exponentially, advanced energy storage technologies will become increasingly important to enable grid stability as well as remote access to green electricity. As a leader in this field, EnerSys is well-positioned to help address this global challenge.

Product innovation and operational efficiency is always part of our core strategy, in any environment. We recognize that long-term value for our shareholders is tied to our financial, operational, and ESG performance.

Regulators around the world are becoming more active on ESG issues, including disclosure requirements and incentives. As investors continue to focus on these issues, we will continue to invest in our operational performance and manage the risks associated with climate change. In 2022, we released our first-ever Task Force on Climate-Related Financial Disclosures (TCFD) Report, providing insight on climate risk assessments, capital allocation, and strategic planning, and offering additional transparency to our stakeholders.

At EnerSys, we are committed to driving a culture of sustainability, inclusivity, resiliency, and reliability. We will keep our stakeholders informed through ongoing disclosure of ESG initiatives and will continue to align our business prosperity with the expectations of our shareholders, employees, customers, and local communities.

Sincerely,

David M. Shaffer
President & CEO