E1 Climate change

Strategy

The Zeppelin Group considers the impacts, risks, and opportunities of climate change, as well as adaptation to its consequences, particularly when investing in new assets, commencing business activities in new markets and countries, and as part of continuous development. The Group carries out climate risk assessments at regular intervals to evaluate acute and chronic risks, taking into account extreme weather conditions and events, in order to avoid negative effects on assets or business relationships.

Zeppelin's goal of achieving greenhouse gas neutrality in Scope 1 and 2 areas by 2030 is based on the Paris Climate Agreement's scenario of limiting global warming to 1.5°C. Key strategies for achieving greenhouse gas neutrality in our business operations include switching to green electricity, using self-generated electricity from photovoltaic modules, promoting e-mobility, and renovating our properties to improve energy efficiency. Zeppelin is also working with partners along the value chain to implement further decarbonization measures, particularly by adapting its product and service portfolio. The transition plan, sustainability targets, and CSR investments have been approved by the Group Management Board and Supervisory Board and are regularly monitored.

Management of impacts, risks and opportunities

Identification and assessment of the main climate-related impacts, risks and opportunities

In 2024, the Zeppelin Group conducted a thorough risk analysis and assessment as part of the double materiality assessment (see ESRS 2) and on climate-related transition risks¹.

Transition climate risks

These risks and opportunities are associated with the transition to an environmentally friendly, carbon-free economy and can be divided into different categories. Zeppelin identified regulatory adjustments, such as new or stricter laws and requirements, as well as higher operating and investment costs due to necessary technical upgrades to systems and equipment or the energy-efficient renovation of existing properties, as risks and areas for action. The transformation of the economy is also expected to alter existing sales markets, decreasing the demand for fossil fuel-based products in the long term while increasing the demand for environmentally friendly, low-emission products and services. These risks and opportunities can affect Zeppelin's business activities in various ways and are therefore considered in strategic planning.

The transition risk analysis is based on the assumption that net zero emissions are achieved and that the Paris Agreement is complied with. This is possible under scenarios SSP1-1.9 and SSP1-2.6². These scenarios were used to identify transition risks within risk categories. The identified risks were then assessed and consolidated using the risk methodology. Specific short-, medium-, and long-term time series were defined to determine time horizons. The short- and medium-term periods were based on the CSRD guidelines, and the long-term period was based on the year 2050 in accordance with the Paris Climate Agreement. A PESTEL analysis was conducted to examine, classify, and systematically evaluate the factors influencing the Zeppelin Group. These factors are divided into six categories: political, economic, socio-cultural, technological, ecological-geographical, and legal.

The results of the transitional risk analysis are presented below. The analysis considers the probability of occurrence and financial impact (severity), taking into account the respective time horizon. There are no transitional risks to Zeppelin's business, meaning that respective business and corporate activities can continue. For high-risk areas, appropriate measures to ensure the company's long-term success are determined and implemented as part of the strategy work, taking into account the respective scope of influence.

Physical climate risks

Physical climate risks can arise from the direct consequences of climate change. Examples include an increase in extreme weather events, such as flooding, forest fires, and dry and drought periods. Depending on the respective macro and micro situations, these environmental events can affect each Zeppelin site differently in terms of the probability and extent of damage. Long-term changes, such as rising average temperatures, as well as indirect risks, such as the limited functionality of international supply chains due to local environmental damage, are also considered. At the same time, physical climate risks present opportunities for Zeppelin because these risks require appropriate structural countermeasures, such as expanding flood protection, irrigation, and drainage systems, as well as renovating buildings to be more energy efficient. A more comprehensive analysis of climate-related physical risks is planned for subsequent years.

Resilience analysis

Through sustainable corporate management, the early consideration of market and technological developments, and the consideration of potential opportunities and risks for its business models and corporate development, the Zeppelin Group ensures a high level of resilience to potential changes and crises. The results of the resilience analysis reveal the primary transition, physical, and systemic risks to Zeppelin throughout its entire value chain and business operations. The consequences for society and the environment are also presented.

Policies and actions

As part of its CSR strategy, the Zeppelin Group has set a greenhouse gas (GHG) neutrality goal for its business operations (Scope 1+2). This target and other relevant climate change targets are supported by Group guidelines, including "Sustainability," "CO₂ neutrality in the real estate sector," and "Cascading of CSR targets," as well as a modernization strategy for property locations (see ESRS 2). Decarbonization and climate change adaptation measures in the downstream value chain focus on integrating sustainable products and services into the portfolio. In the upstream value chain, the Group promotes close cooperation with suppliers, partners, and service providers, and has implemented a code of conduct that explicitly addresses minimizing emissions.

The following climate-related measures are associated with significant investment costs or operating expenses:

Progress 2024

Locations (property): Energy-efficient renovations and new buildings to the GHG neutrality standard

• The Erfurt, Freiburg and Friedrichshafen sites underwent extensive energy renovations during the reporting period. Renewing the building shell and interior fittings, installing photovoltaic systems, air heat pumps, underfloor and circulating air heating systems, and LED lighting made it possible to operate largely free of fossil fuels. Additionally, new buildings designed for climate-neutral operation were completed at the Markgröningen, Landvetter (Sweden), and Eschweiler sites. The new building complex at the Eschweiler site, which includes offices, a workshop, a metalworking shop, a washing hall, an outdoor washing area, an equipment box, a company filling station, and a high-bay warehouse, was built to the KfW Energy Efficiency Standard 55 and completely dispenses with fossil fuels.
• In the reporting year, an office facility in Markkleeberg, Germany, which had been in use for many years and dismantled in 2020 due to a location closure, was rebuilt. This saved the resources required for a new building.

Locations (owned and rented): Use of renewable energies (PV systems, heat pumps, and green electricity)

• New photovoltaic systems were installed at eight locations during the reporting period. Additionally, eight more locations switched to purchasing all their electricity from green sources. This increased the proportion of Group locations with a 100 percent green electricity supply to 52 percent. These measures are reflected in the growing share of renewable energy in total consumption, which increased from 0.8 percent in the previous year to 1.4 percent.
• Zeppelin achieved a milestone at the Friedrichshafen site in early summer 2024. With approximately 8,000 square meters of office space and 30,000 heated square meters in plant engineering halls, the Friedrichshafen site is one of Zeppelin's largest sites worldwide. Installing photovoltaic systems on the parking garage roof and state-of-the-art solar panels on the Ludwig-Dürr-Hall facade meant the entire site could operate independently of electricity for the first time, allowing the cogeneration plant to be temporarily switched off.

Own vehicle fleet: expansion of electromobility

• As part of its modernization strategy, Zeppelin is gradually installing electric charging stations at all of its sites. In the 2024 reporting year, 55 new charging stations were installed, bringing the total number of charging stations at Zeppelin locations worldwide to 338. Additionally, the vehicle fleet is constantly being renewed to take advantage of the efficiency benefits of new models.
• The proportion of electric vehicles in Zeppelin's fleet has increased from 3.6 percent (148 vehicles) to 6.3 percent (277 vehicles). This increase is primarily due to Zeppelin employees with company cars who are increasingly choosing fully electric vehicles.

Value chain: expansion of the product and service portfolio

• "Project Impact," which aims to define and create transparency for sustainable products and services in the Zeppelin portfolio, was completed in the reporting year. Seven criteria that positively impact the environment and/or climate were defined for classification as "sustainable": optimization of energy consumption, extension of the life cycle, conservation of resources, reduction of failures and downtime, reduction of emissions (defossilization), increased usage intensity, and reduced environmental and ecosystem impact. The following table shows the sustainable products and services identified accordingly.

Targets and metrics

The following climate change targets were set in consultation with the Group Management Board and in accordance with Group policies.

Metrics: Energy

The balance sheet limit for determining energy consumption corresponds to the scope of consolidation for non-financial reporting. The energy consumption of each location is divided into its respective energy sources, such as gas, heating oil, or electricity, and recorded in software for non-financial indicators. In the event that the recording of energy consumption is not feasible, such as in instances where flat-rate service charge invoices are utilized or the space is rented to multiple users, the system will make simplifications and provide appropriate notes.

To ensure a level of comparability, energy intensity data for the 2024 reporting year will continue to be reported in accordance with previous years and not according to the ESRS.

Metrics: Greenhouse gas emissions

All fully consolidated companies of the Zeppelin Group are included in the calculation of greenhouse gas emissions. The basis for calculating greenhouse gas emissions for both Scope 1 and Scope 2 is the energy consumption data of the respective locations. Each energy source is assigned a CO₂ equivalent (CO₂e), with country- or location-specific characteristics (e.g., electricity mix, contract content) taken into account to the greatest extent possible. Carbon dioxide equivalents are units of measurement that summarize various greenhouse gases (GHG) in one value. This summary is based on their respective contributions to the greenhouse effect compared to carbon dioxide (CO₂). These units enable the comparison and quantification of the impact of different gases on climate change. Greenhouse gas emissions are calculated on both a market-based and a location-based basis. The emission factors required for conversion are maintained in central software so that GHG emissions are calculated automatically once the respective energy consumption has been entered. The emission factors used are regularly reviewed to ensure they are current and accurate, and any necessary corrections are made. The respective energy consumption is multiplied by the CO₂ equivalent. The total emissions for each energy source are calculated to determine the carbon footprint of the site or, on a highly aggregated basis, the Group company or SBU. As part of the energy management system, metrics are periodically reviewed by our certification body (see ESRS 2). However, please note that greenhouse gas metrics are not yet validated by an external entity.

As part of the ongoing digitalization process, the Zeppelin Group began implementing smart meters at its German locations in 2024 with the objective of improving data availability and quality. A gradual conversion of further meters, both nationally and internationally, is planned for 2025.

Zeppelin calculated all Scope 3 emissions for 2023 in the reporting year. In accordance with the initial determination for 2022 (see Sustainability Report 2023), the objective was to enhance the data collection processes. "Use of our products" was confirmed as the most relevant category, accounting for around 91.5 percent of our Scope 3 emissions. No Scope 3 emissions were determined for the 2024 reporting year. As a result, greenhouse gas emissions will continue to be reported in the same manner as in previous years. They will not be reported in accordance with the ESRS for the time being, in order to enhance comparability.

To ensure a level of comparability, the greenhouse gas intensity for the 2024 reporting year will continue to be reported in the same manner as in previous years, rather than according to the ESRS.

The Zeppelin Group does not currently utilize an internal CO₂ pricing system. A concept is currently being developed, and a possible introduction for the 2026 financial year is being examined.

Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)

The EU taxonomy is a classification system for sustainable economic activities. The primary objective is to encourage sustainable investments to align with the goals of the EU Green Deal.

As part of the preparations for reporting in accordance with CSRD/ESRS and the EU Taxonomy Regulation, an interdisciplinary project team on the EU Taxonomy was established in 2023. This team conducted a kick-off and initial assessments of economic activities. In 2024, an implementation concept was developed and financial processes and systems were adapted. This allows for the efficient collection of necessary data during ongoing operations. Additionally, a dry run was conducted with the support of external consultants on the following metrics of the EU taxonomy:

• Capital expenditures (CapEx) that meet the criteria for both Taxonomy-eligible and Taxonomy-aligned

• Operating expenses (OpEx) that meet the criteria for both Taxonomy-eligible and Taxonomy-aligned

• Sales revenue that meets the criteria for both Taxonomy-eligible and Taxonomy-aligned

• “Do No Significant Harm” (DNSH) check

The results are used for continuous improvement and preparation for future reporting.

¹ Transition risks arise from the social and economic changes necessary for a transition to a low-carbon future. These risks may include political, regulatory, market, reputational, technological,
and legal risks.

² According to ESRS E1, climate-related transition risks should be identified by considering at least one climate scenario consistent with limiting global warming to 1.5°C with no or limited
overshoot (see ESRS E1 IRO-1.20ci). An increase in the global average temperature of up to 1.6°C is considered limited, while an increase of up to 1.8°C is considered a strong overshoot. Both are
in line with the Paris Agreement. Therefore, SSP1-1.9 is the required scenario for the transition climate risk analysis. However, it is recommended that SSP1-2.6 be considered in conjunction with
SSP1.1-9 because the CO₂ trajectories implied in SSP1.1-9 are no longer considered realistic by the majority of the scientific community