Origin Energy

Between 2017 and 2021, Origin decreased its scope 1, 2 and 3 emissions intensity by over 2% per year. Although promising, this is not sufficient to align with its 1.5°C pathway which requires an annual reduction of 4%. Between the financial years 2021 and 2022, Origin increased its share of zero-carbon electricity by almost 150%. However, the company’s share of gas sales remained relatively stable during the same period. To align with its 1.5°C pathway, Origin needs to commit to significantly reducing its gas production and sales.

Origin has been awarded USD 31 million from the Australian government to progress several green hydrogen projects, including the proposed Hunter Valley Hydrogen Hub, the Tasmanian Green Hydrogen Hub Project, and the potential development of a green hydrogen supply chain between Japan and Australia as a joint initiative with ENEOS. Origin’s hydrogen business model is currently at an early stage of development. However, in order to reach its climate targets, the company will need to significantly ramp up its hydrogen production, along with renewable energy generation, in the coming decade.

Origin is predicted to stay within its 1.5°C carbon budget between 2022 and 2050. The company is also expected to see a drop in its cumulative scope 3 emissions between 2022 and 2023. However, Origin has not committed to stopping gas exploration and expansion. This does not align with the International Energy Agency (IEA) Net Zero Emissions (NZE) by 2050 Scenario, which does not allow for any expansion of producing assets beyond those sanctioned earlier than 2022. To ensure it stays within its carbon budget, Origin must refocus its strategy away from gas as a transition fuel and look to growing its renewable and green hydrogen portfolios.

Origin annually publishes a review of its industry association memberships which is approved by the company’s executive board. Origin suggests that it considers the policy positions of trade associations when assessing new memberships, including their positions relating to climate change. Despite this, Origin is a member of two trade associations that are found to take a climate negative stance. Origin’s CEO is the director of one of these associations, the Australian Petroleum Production and Exploration Association.

Origin has a long-term ambition to achieve net-zero material scope 1, 2 and 3 emissions by 2050. It also has a mid-term 2030 target to reduce its scope 1, 2, and 3 equity emissions intensity by 40% compared to 2019. Further, it has a short-term target to reduce its scope 1 equity emissions by a cumulative 8 million tonnes of carbon dioxide equivalent between 2021 and 2023, against a 2017 baseline. This is an updated target from Origin’s previously stated aim to reduce its scope 1 equity emissions by an annual average of 10% between 2021 and 2023. In 2022, Origin announced its ambition to cease coal-fired generation at Eraring Power Station, its last remaining coal-fired plant, as early as 2025.

Origin has a comprehensive transition plan which includes targets for its absolute scope 1, 2 and 3 emissions as well as emissions intensity, and a central ambition to become net zero by 2050. In 2022, Origin published its first climate transition plan, which Origin intends to report its progress against on an annual basis. Origin is focused on growing its renewables portfolio and aims to increase its generation to 4 GW by 2030, from 1.6 GW in 2022. However, Origin lacks detail on its long-term actions towards reaching net zero by 2050 and the company should create a longer-term transition plan.

Although Origin has not committed to completely phase out fossil fuels, it has announced its intention to exit some of its upstream assets. As of 2023, Origin has completed the sale of its exploration interests in the Beetaloo and Canning Basins. However, Origin has signed a gas sales agreement for Beetaloo, ensuring that if the site is explored, Origin will receive royalties. Despite claiming that it plans to withdraw its upstream exploration permits, Origin continues to retain the position that gas will remain a core part of its business. In the coming years, Origin’s gas activity is likely to increase, mostly through its share of Australia Pacific LNG, which is planning on bringing more gas wells in service in the next few years.

Origin has recently acquired three new solar farms and is looking to develop two more. It has accelerated its early exit from coal-fired generation at its Eraring Power Station and has approved the construction of a grid-scale storage battery at the site instead. Between 2021 and 2022, Origin increased its zero-carbon electricity production by nearly 150%. However, coal and gas generation remain the most significant part of Origin’s internal generation portfolio.

Origin has the long-term ambition to achieve net-zero material scope 1, 2 and 3 emissions by 2050. However, its continued reliance on gas will affect its ability to reach this target. Moreover, Origin undermines its climate goals by using the word ambition instead of clearly setting out science-based targets. Origin is predicted to stay within its 1.5°C carbon budget between 2022 and 2050. However, the company retains its position that gas will play a pivotal role in its business in the coming years. Origin states that beyond 2030, it expects its emissions to be primarily associated with gas-fired generation, their equity share of Australia Pacific LNG’s gas production, and sales and LPG distribution.

The company commits to engaging in social dialogue with workers and unions. It also discloses the categories of stakeholders it engages with on a just transition, including employees, contractors, suppliers, government, industry and media, among others. Furthermore, the company demonstrates ongoing social dialogue and meaningful engagement with affected stakeholders through a transition consultation committee where employees, unions and site leaders convene to discuss related matters. The company incorporates social dialogue and stakeholder engagement in its just transition planning. However, no evidence was found that the company has a set of time-bound, measurable indicators to mitigate the social impacts of the low-carbon transition on workers, affected stakeholders and its business relationships.

The company has a commitment to create and support access to green and decent jobs as a part of the low-carbon transition. However, it can increase disclosure by providing evidence of the actions it takes to provide these jobs in a way that ensures gender balance and inclusion of vulnerable groups. No relevant disclosure was found of the company’s assessment of employment risks. The company demonstrates how it contributes to addressing the impact of the low-carbon transition on social protection of workers and affected stakeholders. For example, it provides health and well-being support as well as training in financial planning and mental health for its workers. It also commits resources to a community fund under its engagement strategy. The company can increase its disclosure of the process it uses for identifying the impacts of the low-carbon transition on its workers and stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company demonstrates how it contributes to addressing the impact of the low-carbon transition on social protection of workers and affected stakeholders. For example, it provides health and well-being support as well as training in financial planning and mental health for its workers. It also commits resources to a community fund under its engagement strategy. The company can increase its disclosure of the process it uses for identifying the impacts of the low-carbon transition on its workers and stakeholders.

No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work, but it can place the same expectation on its business relationships. No evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and in its supply chain. The company does, however, provide examples of how it engages with stakeholders on the topics of human rights, and it has a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. However, no evidence was found of the company having a time-bound target for paying all workers a living wage, even though the company does support the payment of a living wage by its business relationships. While the company discloses the proportion of its direct workforce covered by collective bargaining agreements, no relevant disclosure was found of the company’s required working hours. The company discloses some indicators of workforce diversity, including gender. However, no relevant disclosure was found of additional indicators of workforce diversity. The company commits to gender equality and women’s empowerment.

The company commits to protecting personal data. However, no evidence was found of the company having a privacy statement regarding the collection, sharing and access to personal data. Furthermore, the company can disclose its global tax strategy. The company does have a policy prohibiting bribery and corruption and provides mechanisms accessible to all stakeholders to raise bribery and corruption concerns; however, it can include corresponding clauses in its business relationship contracts. No relevant disclosure was found of the company’s expenditure on lobbying activities.