ANNUAL REPORT 2021

Annual report 2021 Železiarne Podbrezová a.s. 40 GREEN STEEL ŽELEZIARNE PODBREZOVÁ A.S. AND ITS MISSION TO UNDERTAKE GREENSTEEL PRODUCTION Although ŽP a.s. is not the largest producer of carbon dioxide emissions in Slovakia, it recognises the importance of the climate challenge as a carbon dioxide emitter. The submitted document describes the most important technological changes the Company has made since 1990, which have significantly contributed to reducing its carbon footprint. DECREASE IN CARBON DIOXIDE EMISSIONS AT ŽP a.s. SINCE 1990 ŽP a.s. has its registered office in Podbrezová in central Slovakia and is a leading European steel tube manufacturer. The Company’s history began in 1840 and is full of milestones that allowed the Company to retain its leading position among metallurgical plants. ŽP a. s.’s modern technological facilities include an integrated recycling system for steel and cast- iron waste via an electric arc furnace (EAF), which produces steel and seamless steel tubes, and has a 10% share of EU consumption of seamless hot- rolled tubes and precision seamless cold-drawn steel tubes (12% with the production of Transmesa, Spain, a subsidiary). As regards carbon dioxide emissions, the Company took several visionary steps to reduce its carbon footprint and improve the quality of the environment in the Horehronie region in the 1990s. The most important step that significantly reduced carbon dioxide emissions was the construction of a new electric steel plant over the period 1990 – 1993. During the construction, a 60 t high-performance EAF was put into operation, replacing two smaller electric arc furnaces and three open-hearth (Siemens-Martin, SM) furnaces, which used heavy fuel oil (HFO) as a fuel source. Crude steel and emission production between 1990 and 2019 is presented in Table 1. The construction of a new electric steel plant decreased carbon dioxide emissions by more than 50%. In Podbrezová, May 2022 INTRODUCTION In December 2015, world leaders formulated ambitious objectives to fight global warming under the Paris Agreement on Climate Change. The Paris Agreement has been ratified by all EU Member States, including Slovakia. In 2019, in line with the Paris Agreement, the European Council approved the goal of achieving climate neutrality by 2050. This objective became part of an initiative of the European Commission – the Green Deal. Under this initiative, a partial objective to reduce greenhouse gas emissions by 2030 compared to 1990 by 55% was also set (the European Parliament advocates the reduction of greenhouse gas emissions by 60%). The most significant greenhouse gas contributing to the global warming is carbon dioxide (CO 2 ), which is the main greenhouse gas in the EU and in Slovakia. Charts 1 and 2 show greenhouse gas emissions produced by individual industries in the EU and Slovakia. The energy sector is responsible for more than 80% of emissions in the EU. Industrial activities are responsible for 8% of total emissions. In Slovakia, industrial activities are responsible for approx. 22% of greenhouse gas emissions. As regards total greenhouse gas emissions, Železiarne Podbrezová a.s. (ŽP a.s.) ranked 30th of 113 companies in 2019 involved in emission trading and contributed 0.45% of total emissions. Prepared by: Approved by: ŽP Výskumno-vývojové centrum s. r. o. (Research and Development Centre) Odbor bezpečnosti a životného prostredia ŽP a.s. (Safety and Environment Department) Prevádzkareň Energetika ŽP a.s. (Energy Division) Ing. Vladimír Soták CEO of ŽP a.s.