Hexagon Annual Report 2019

56 2019 AT A GLANCE FROM THE BOARD ROOM FINANCIAL STATEMENTS Sustainability Report Hexagon provides solutions across the alternative fuel spectrum. This includes high-pressure tanks and fuel sys- tems for compressed natural gas (CNG), renewable natural gas (RNG), propane and hydrogen as well battery electric systems. Hexagon’s strategic focus is to further expand its leadership position within gas mobility (g-mobility) and electric mobility (e-mobility) through innovation and world class manufacturing. “Firms ignoring climate crisis will go bank- rupt. There will be industries, sectors and firms that do very well during this process because they will be part of the solution. But there will also be ones that lag behind, and they will be punished.” Mark Carney, Bank of England Governor, 13 October 2019 G-MOBILITY SOLUTIONS – THE FASTEST, MOST COST-EFFECTIVE ANSWER TODAY Natural gas is one of the cleanest burning fuels available today, giving lower greenhouse gas (GHG), nitrogen diox- ide (NOx) and particulate matter (PM) emissions versus petroleum fuels. Hexagon’s CNG tanks and systems are used in a wide range of applications. For instance, through its subsidiary Agility Fuel Solutions, it provides CNG fuel systems to medium and heavy-duty OEMs and fleets in North America and Europe. Hexagon Purus provides CNG tanks to light- duty vehicles in Europe and Hexagon Mobile Pipeline® delivers large capacity modules for gas transportation. A CNG truck running on natural gas emits 13-21% less GHG emissions, 90% less NOx and almost zero PM versus comparable gasoline and diesel vehicles. When fueling with RNG, GHG emissions can be reduced significantly 1) . Renewable natural gas (RNG) RNG is commercially viable, supported by local and regional jurisdictions, fully interchangeable with existing natural gas infrastructure and based on proven technology. As a potentially carbon-negative solution, it contributes to reaching climate targets by reducing both CO2 tailpipe emissions and methane emissions from waste. RNG can be generated from a variety of organic waste substances including municipal solid waste, sewage sludge, yard and crop wastes, food wastes and animal manure. RNG produced from organic sources through anerobic digestion contains 45-65% methane. Without capture this methane can escape to the atmosphere where it is roughly 30 times more potent as a greenhouse gas than CO2. If this biogas is captured and treated to remove moisture, CO2 and other impurities, it can result in a gas that is up to 95% methane and is fully compatible with existing systems as a drop-in replacement for fossil natural gas. Hexagon’s cylinders and CNG fuel systems can run on 100% RNG whilst Hexagon’s Mobile Pipeline® modules are a key enabler for transporting this zero-carbon fuel from rural producers to the gas grid and industrial users. CLIMATE AND ENVIRONMENTAL EFFECTS OF HEXAGON’S PORTFOLIO OFFERING Did you know: There are around 3.7 million Class 8 trucks in operation in the U.S. today. The great major- ity are still powered by diesel. By switching these from diesel to readily available natural gas, it is possible to avoid 127 million tons of CO2 emissions per year 2) . Agility’s clean solutions have over the last three years cumulatively contributed over 400,000 tons of CO2 emissions saved, equivalent to taking 80,000 cars off the road for a year 3) . In 2019, Hexagon’s CNG tanks for light-duty vehicles helped save over 12,000 tons of CO2 4) . 1) NGV America, Argonne GREET 2019 2) All assumptions regarding fuel usage, distance traveled, and emission factors are from the 2019 GREET model (https://greet.es.anl.gov/). Number of trucks is based on internal sales figures. 3) Assuming no RNG source included 4) Based on number of systems sold in 2019 and the emissions of a CNG VW Golf versus a similar performance diesel Golf using EU emissions test figures and average driving distances