Climate Policy Engagement Analysis
Climate Policy Engagement Overview: Vestas Wind Systems (Vestas) is strategically and positively engaged with climate policy in the EU and US. The company is strongly supportive of renewable energy legislation to upscale wind energy, and advocates for science-aligned policies to transition the energy mix. Vestas is a member of industry groups that have taken negative positions on some US federal climate polices, including the South African Wind Energy Association.
Top-line Messaging on Climate Policy: Vestas demonstrates positive top-line messaging on the need for GHG emissions reductions and government regulation to respond to climate change. On its corporate website, accessed in September 2024, and an October 2023 joint letter, the company advocated for an GHG emissions reductions pathway in line with limiting global warming to 1.5°C. Vestas supported setting “a meaningful price on greenhouse gas emissions” in its 2023 Sustainability Report, published in March 2024. In its 2023 CDP Climate Change Disclosure, the company broadly supported a range of EU climate policies, including the Fit for 55 package. In an October 2023 joint letter ahead of COP29, Vestas’ CEO Henrik Andersen supported the UN Paris Agreement by calling on governments to commit to more ambitious Nationally Determined Contributions.
Engagement with Climate-Related Policies: Vestas is supportive of climate regulations, particularly renewable energy legislation in the EU and US. The company supported faster permitting rules and greater government investment for renewables in its corporate website, accessed in September 2024. CEO Henrik Andersen also supported faster permitting rules in an August 2024 investors’ earnings call. Ahead of COP28 in September 2023, Vestas signed a joint letter calling for a global target to be set at COP28 to triple renewable energy capacity by 2030. Vestas CEO Henrik Andersen and Board Chair Bert Nordberg have consistently supported the US Inflation Reduction Act (IRA) and faster permitting rules adopted in the EU, as demonstrated in its 2023 Annual Report, published in March 2024.
In a September 2024 position paper, Vestas supported faster permitting rules for renewables, while appearing to support greater government investment. In its 2023 Sustainability Report, published in March 2024, the company supported specific renewable energy legislation, including the EU Wind Power Package. Vestas called for incentivizing circular economy principles for wind turbine recycling in its 2023 Sustainability Report, published in March 2024, but did not clarify whether it supported policy according to the waste hierarchy.
Positioning on Energy Transition: Vestas is highly supportive of the transition of the energy mix in the EU and US. The company advocated for the removal of fossil fuel subsidies and supported key climate investment regulations, including the EU Net Zero Industry Act and US Inflation Reduction Act, in an October 2023 joint letter. In a September 2024 article on its corporate website, Vestas supported government investments to shift away from fossil fuels to a renewables-based energy system. CEO Henrik Andersen signed a joint letter in October 2024, in which he advocated for removing permitting barriers to renewable energy projects and boosting renewable demand through greater electrification of heating, transport, and industry. In the same letter, he also called for the removal of fossil fuel subsidies.
Vestas supported the increased use of sustainable aviation fuels in aviation, without outlining support for a future transition to synthetic fuels and electric/hydrogen power, the pathway that is recommended by the IPCC to limit global temperature rise to 1.5C, in a May 2024 press release.
Industry Association Governance: Vestas disclosed a list of industry association memberships in its 2023 Sustainability Report, but it does not appear to have disclosed an account of its industry associations' positions and engagement activities. The company is a member of WindEurope and SmartEn, two industry groups which are strategically and positively engaged with EU climate policy. It also retains membership to the South African Wind Energy Association (SAWEA), which has taken some negative positions on US federal energy-related policies like the Inflation Reduction Act, advocating for a weaker implementation of the clean hydrogen tax credit.