Iberostar's Journey towards Decarbonization and Energy Transition

Our dedication to climate action goes hand-in-hand with the evolution of our business towards a more responsible model of tourism that serves the triple bottom line; people, planet, and a business which leaves a positive legacy. To support this, we're making headway in our decarbonization journey through a holistic and ambitious approach to energy, uniting all our efforts and combining different strategies to find innovative solutions that spark positive change.

A cornerstone of our approach is the sourcing of renewable energy. We are gradually increasing the use of renewable energies across our real estate through power purchase agreements (PPAs) and guarantees of renewable origin (GdOs). Collaboration between the public and private sectors is crucial to achieve this goal, as demonstrated by our power purchase agreement with ACCIONA Energía , announced this week, which will provide us with 100% renewable electricity across our Iberostar hotels in Spain, headquarters, and our W2M WORLD2MEET travel division.?

Thanks to this agreement, we are advancing in reducing our emissions generated by our electricity consumption, which represents more than two-thirds of the energy consumed by Iberostar. In this way, we move closer to our goal of driving the energy transition in the tourism sector.

Another key lever of our decarbonization plan is to increase the renewable energy capacity in destinations where access to clean energies is limited. It is important to adapt to the reality of each territory and seek energy solutions for those destinations where signing energy agreements or acquiring guarantees of origin isn't possible. In 2023, we installed a photovoltaic plant at Iberostar Rose Hall Resort in Jamaica, ensuring an on-site renewable energy supply.?

Our energy approach focuses on developing a hybrid system that combines different solutions. We are diversifying our energy sources and betting on innovation. In collaboration with Redexis, we are planning the installation of the first green hydrogen fuel cell for cogeneration at the Iberostar Bahía de Palma hotel in Mallorca. Green hydrogen is a promising solution to reduce greenhouse gas emissions, especially in destinations with challenges in the renewable energy supply.

On our path to carbon neutrality, we are also reducing fossil fuel consumption. The main uses of fossil fuels in the hotel are concentrated in heating and hot water production, kitchen equipment, transportation, and laundry. A key part of our strategy is to transform these uses and replace them with electric or low-consumption alternatives. For example, we are replacing boilers with high-efficiency heat pumps and, at the same time, we are electrifying our kitchen equipment.

The electrification of our hotels, together with the use of renewable electricity, puts us on track to our goal, validated by the SBTi initiative, of reducing our scope 1 and 2 emissions by 85% by 2030. Regarding scope 3 emissions, we plan a 50% reduction by 2023, which will be achieved with collaboration across the value chain and the implementation of a new methodology for calculating our indirect emissions based on average emissions data and specific suppliers.

The electrification of our hotels and the use of renewable electricity bring us closer to our goal, validated by the SBTi initiative, of reducing our scope 1 and 2 emissions by 85% by 2030. However, much remains to be done, especially regarding scope 3 emissions, which represent 77% of our global footprint. Recognizing the great challenge posed by indirect emissions in the tourism sector, our strategy emphasizes the importance of working collaboratively with the value chain to carry out transformative actions that enable us to reduce our scope 3 emissions. Regarding these emissions specifically, we plan a 50% reduction by 2023, which will be achieved with collaboration across the value chain and the implementation of a new methodology for calculating our indirect emissions based on data from specific suppliers.

Our commitment is also not limited to energy transition. We focus on optimizing consumption through energy-saving and waste reduction actions to achieve a 35% reduction in energy consumption by 2030. Our staff is fundamental to achieving these goals, and as a result we work closely with our teams in all destinations to incorporate good energy practices. Additionally, we are investing in high-efficiency equipment and improving the performance of existing ones, significantly contributing to our energy reduction goal.

At Iberostar Group , we want to continue driving responsible tourism and inspire the tourism sector to contribute to climate action. By showcasing the business case for change we hope to inspire others to take similar steps.? sharing the journey we have taken so far, we seek to demonstrate that it is possible to transform business models and move towards a better future. We know the path will have challenges along the way, but I am very proud of the approach and strategy we have set in place to overcome them. Together.