E5 Resource use and circular economy

Our grid requires many cables, pipes, transformers and other products made from valuable resources. Indirectly, this means we use a lot of resources. We want to increase our circularity to reduce our negative impact and make the most of our opportunities.

Negative environmental impacts can occur in the production of components (the upstream value chain). Raw materials can also be lost unnecessarily or lose their value through waste (the downstream value chain). Within the topic of material use and the circular economy, we identify the following negative impacts and opportunities:

Environmental	Impact, risk or opportunity	Value chain	Time frame
Material topic
Circular economy Resource inflows, including material use	Actual negative impact: Enexis procures resource-intensive components, resulting in a significant raw material footprint and potential environmental impacts within the upstream value chain.
Circular economy Resource outflows: waste and reuse	Actual negative impact: Waste of materials leads to the unnecessary loss of resources, downcycling and the generation of waste that must be transported and processed. This results in avoidable greenhouse gas emissions and potential other environmental damage.
	Actual opportunity: Reusing materials reduces the cost of purchasing new materials (avoided procurement costs) and extends the life of previous investments.

Policy: towards circularity

In a circular economy, primary materials, also known as virgin materials, are used as little as possible, and the value of resources is retained for as long as possible. In a circular economy, there is also little or no waste. The Dutch government is working towards a circular economy. Enexis also considers it important to contribute to a circular economy. This is why we encourage our suppliers to use fewer raw materials and more recycled materials, and work to optimise the life span of components, products and materials through reuse and reduce waste. In this way, we reduce negative environmental impacts, move away from the use of primary materials and encourage the use of secondary materials. Reuse is also a financial opportunity as we save significant procurement costs. ^{(ESRS E5-1 para. 12, 15 a en b, para 16, ESRS 2, MDR-P 65a, MDR-P, 65d, f, E5-1 AR 9)}

The 10 steps in the R ladder

The R ladder inspires us to contribute to the circular economy. This ladder consists of 10 Rs, with Refuse being the highest step on the ladder and Recover the lowest. 

• Refuse: make raw materials redundant;

• Rethink: more intensive use of the same raw materials;

• Reduce: reduce the amount of raw materials per unit of product;

• Reuse: reuse raw materials;

• Repair: repair raw materials;

• Refurbish: refurbish raw materials;

• Remanufacture: remanufacture raw materials for the same purpose;

• Repurpose: repurpose raw materials for a new purpose;

• Recycle: recycle raw materials;

• Recover: recover energy from materials by incineration/digestion.

The higher the strategy on the R ladder, the fewer (primary) raw materials are needed, and the better the value of raw materials and materials is maintained. In this way, products have a longer life cycle. We have identified actions for the different R strategies. More can be found in the section ‘Measures that promote circularity’. ^{(AR 9a, MDR-P 65 d)}

Raw material reduction in procurement

Our main goal in sourcing materials is to reduce the amount of primary raw materials per product unit. We focus on the components with the greatest environmental impact: low-voltage (LV) and medium-voltage (MV) cables, gas pipes and distribution transformers. These components consist of the following commodity groups: ^{(ESRS 2 MDR-P, 65 a,b, E5-4 30)}

To enable the energy transition, we are significantly expanding our grid and require substantially more materials. We focus on purchasing materials that use less virgin material. Our emphasis is on sourcing components made from secondary raw materials. We call on our direct suppliers in the upstream value chain in the European Union, Switzerland, and Turkey to stand out positively in terms of sustainability, and we factor this into our purchasing decisions. We monitor the results using our circularity model. This tool, developed in collaboration with an external circularity specialist, provides insights into the proportion of primary raw materials in the components and the share of secondary raw materials per product. ^{(ESRS 2 MDR-P, 65a,b, ESRS E5 12, 15a,b, 16).}

Reuse prevents waste and saves money

Reuse is essential for achieving our circular ambitions. Reuse also touches on several R strategies in the R ladder. With reuse, we bring resources from old products back into our operations, preventing them from becoming unnecessary waste. This is done after rigorous testing and under specific conditions to make sure that functionality and safety are never compromised. Reuse avoids the use of virgin raw materials. This not only benefits the environment but also saves on procurement costs. We can see what reuse is worth by measuring the avoided procurement value. ^{(E5-1 para 14, 15 a, 16, ESRS 2 MDR-P 65a, b, AR 9a)}

Increase the application value of raw materials

When products leave our operations, we aim to maximise the application value of the raw materials. This means ensuring high-quality processing: raw materials are reused, remanufactured or, at the very least, recycled. We try to avoid landfill as much as possible. These activities take place in our own operations, in cooperation with suppliers and waste processors (upstream). ^{(ESRS 2 MDR-P, 65a,b, E5-1 para 16, AR 9a).} 

Preventing waste

Despite our best efforts, waste is generated in our operations. Naturally, we want to prevent this. We do this by focusing on optimal inventory management (to avoid unnecessary purchases), by being conscious of resources, and by preventing (residual) waste. We do not (yet) measure the impact of waste and the effects of policies to reduce it. ^{(ESRS 2 MDR-P, 65a,b, E5-1 para 16, AR 9a).}