Green production and energy security
Ignitis Group AB is expected to continue to look for opportunities to increase the volume of electricity production and to invest in the production of electricity from renewable energy resources in Lithuania and the region, primarily in offshore and onshore wind parks, solar and hybrid technologies. The letter also emphasizes the priority of investing in energy storage solutions such as hydrogen, batteries, synthetic fuels, etc. When planning investments, the company is expected to evaluate the socioeconomic effect and decisions that create the highest added value from a national point of view.
The letter also focuses on ensuring the reliability and efficiency of the electricity distribution network, expanding the network, and enabling electrification in Lithuania. To achieve these goals, investments are being made in the development of new electricity consumers, the network of charging stations for electric vehicles, and the programme of installation of smart meters.
The company must ensure the availability and long-term labour resource of the infrastructure managed by it that is important for ensuring national and energy security – the electricity generating facilities operated by Elektrėnai Complex.
The letter emphasizes that the company should continue its strategic development in the region due to economies of scale, competence development and risk diversification. While giving priority to the development in Lithuania, attention should be focused on the development of activities in other Baltic countries, as well as in Poland and Finland. Development in the region aims to benefit both Lithuanian consumers and return on investment – additional income could be channelled to further expansion of green production capacities, modernization of the country's energy network, etc.
Solutions for customers
In the letter of expectations, it is expected that Ignitis Group AB will increase the volume of electricity supply in the region, providing end customers with clean energy produced in its green production plants and ensuring a good user experience. Priority must also be given to the development of the customer portfolio and its use for the conclusion of long-term power purchase agreements (PPA), thus enabling faster development of its green production. The Ministry of Finance emphasizes that Ignitis Group AB should strive to exploit the advantages of economies of scale, providing competitive and affordable energy services for businesses and residents, and ensure quality customer service.
The expectation for the group to look for innovative solutions, enabling creation of the greatest value for electricity consumers, was also expressed. Innovative solutions should contribute to environmental goals and help consumers become energy smart.
Financial expectations
Ignitis Group AB dividends should grow by at least 3 % for each subsequent financial year according to the Government resolution. The profits of the company's subsidiary companies carrying out the development of green production should be reinvested in the further development of production capacities. Meanwhile, the rest of the company's businesses must aim for maximum dividend payouts.
The company must ensure a return on capital employed (ROCE) of at least 6.5 %. When making decisions to invest outside of Lithuania, the country's market risk should be properly assessed and the appropriate return on capital should be ensured.
Environmental, social responsibility and good corporate governance practices
The letter emphasizes that the criteria of environmental, social responsibility and good corporate governance practices must be included in the company's long-term operational goals. The commitment by 2050 to reduce the net amount of carbon dioxide emissions to zero and contribute to the implementation of the Sustainable Development Goals must be consistently implemented.
Ignitis Group AB must contribute to increasing the awareness, popularization and prestige of the energy engineer profession and increase its attractiveness as an employer in order to attract to the country the missing competences for the implementation of the strategy, as well as to continue the good corporate governance practices.
Ignitis Group AB is a company of strategic importance, whose activities include the management of the infrastructure of the entire country's energy system, the development of green production and the implementation of projects of strategic importance. The Ministry of Finance owns 74.99 % of Ignitis Group AB shares, small investors – 25.01 %.
