Cloudberry Clean Energy Annual report 2020

37 Cloudberry Annual report 2020 Sustainability TCFD Risk Like- lihood 1) Financial Impact 2) Time Horizon 3) Description Risk mitigation Opportunity Revised water regulation permits Medium Low Medium Revision of existing hydropower regulation plans might be more restrictive regarding minimum water flows, reservoir level changes, etc., to better preserve natural habitats, fish spawning, etc. Cloudberry seeks to stay ahead of laws and regulations in all projects as well as in regular operations by closely following political proposals and industry association's recommendations on new or revised regulations. Revised wind power permitting High Low Short Following public and political hearings throughout 2019/2020 NVE are likely to be working from a revised and more conservative framework when considering permits for new power production projects. Cloudberry seeks to be proactive and follow public hearings and industry association’s recommendations on coming regulations. Focus on projects with less conflict, seek industrial areas for developing wind projects, as opposed to hunting for the largest and most windy sites. EU Taxonomy High High Short Suggested criteria threshold for facilities to operate at life cycle emissions lower than 100g CO 2 e/kWh, declining to 0g CO 2 e/ kWh by 2050 and hydropower facilities with a power density above 5 W/m 2 are currently exempt from conducting the Product Carbon Footprint (“PCF”) or Greenhouse Gas (“GHG”) Lifecycle Assessment. These and “Do no significant harm” may affect negatively on hydropower plants in general, and as such, on our reputation and capital access. Cloudberry has performed initial analysis of its emissions and impact and is preparing for potential risk mitigation actions. The company continues to follow the EU Taxonomy for sustainable activities and cooperate with national and European hydro associations to secure preparations and be aligned in line with potential outcome and requirements. Cloudberry is focusing primarily on new and highly efficient plants minimizing CO 2 e impact and optimizing uptime and production. An international legislation with common European requirements contributes to a more predictable environment for renewable projects. New subsidy schemes Medium Medium Long Massive climate goal- motivated subsidy schemes may put downwards pressure on revenues (i.e., power prices) of non- subsidized existing assets. Cloudberry considers subsidized offshore wind power as the most likely threat. Appreciate the location of power plants away from the point of shore entry of coming offshore wind hubs. Take an active position in such tenders ourselves, as a natural hedge. 1) The likelihood is based on provisional internal assessments and will be further developed through scenario analyses in the years to come 2) Financial impact: Low < 10 mill, Medium 10-100 mill, High > 100 mill 3) Time horizon: Short: 0-3 years, Medium: 3-10 years, Long: more than 10 years Transitional Risks and Opportunities Policy and legal