Reclaim Finance has published an analysis of ENGIE’s revised climate plan, ahead of the upcoming General Meeting on April 24. The analysis highlights the lack of progress toward phasing out fossil gas and provides recommendations to help guide the decisions of financial stakeholders.
ENGIE is one of the world’s largest electricity producers, with over 100 GW of installed generation capacity, nearly half of which comes from fossil gas power plants.(1) ENGIE will submit its new climate plan(2) to a shareholder vote through a “Say on Climate” presentation. Its analysis shows that no measures are presented to anticipate and plan for the necessary phase-out of fossil gas, nor to align its decarbonization goal with the “Net Zero Emissions by 2050” (NZE) scenario from the International Energy Agency (IEA),(3) which is required to stay within the 1.5°C limit.(4) Furthermore, ENGIE is continuing its gas expansion strategy through new gas-fired power plant projects, LNG terminal expansions, and the signing of new long-term LNG import contracts.
No progress on fossil gas
Nearly half of ENGIE’s installed power generation capacity consists of fossil gas plants, yet the 2025 climate plan does not mention any reduction in these capacities compared to 2024. As a result, its gas capacity level should be consistent with that of the past five years,(5) far from the path needed to limit global warming to 1.5°C. From 2020 to 2023, ENGIE’s gas capacity decreased only slightly, from 52.5 GW to 49.2 GW. Similarly, the share of gas in the company’s energy mix has remained relatively stable, hovering around 50%: 51.9% in 2020 and 49.2% in 2023.
Graph 1: ENGIE’s installed gas power capacity – 2020 to 2023 (GW)
Graph 2: Share of fossil gas in ENGIE’s energy mix (installed capacities)
The company’s climate plan still does not include a phase-out date for fossil gas, or any specific asset-by-asset exit strategy. It also contains no information regarding the termination of the expansion projects, such as the gas plant in Nijmegen (Netherlands) or the expansion of two LNG import terminals in France.(6) These projects are not only incompatible with the climate goals of the respective countries(7) but are also unnecessary for ensuring electricity supply.(8) The announcement of a halt to the signing of long-term LNG import contracts, which have multiplied in recent years,(9) is also absent from this new plan. Such contracts contribute to the development of new LNG export terminals and lock us further into a carbon-intensive trajectory.
Limited growth in renewables
On a more positive note, the plan increases the renewable energy capacity target by 5 GW compared to the previous year, bringing the total to 95 GW by 2030,(10) particularly notable at a time when other major electricity producers are lowering their ambitions.(11)
However, one must question the significance of these developments within a strategy that still heavily relies on high-emission sources like fossil gas. Decarbonizing the electricity supply requires that new renewable capacity replaces, not adds to, existing fossil fuel capacity.
Still not on a 1.5°C pathway
Due to its lack of commitment on fossil gas, ENGIE remains on a “well below 2°C” pathway and is unable to raise its ambition to align with a 1.5°C scenario, unlike several of its peers, such as Iberdrola, Statkraft, and Enel.(12) ENGIE’s decarbonization target remains set at 2045, which is incompatible with the IEA NZE scenario that requires electricity sector decarbonization by 2035 in advanced economies and by 2040 in others.(13)
The pace at which fossil fuels are phased out is crucial to achieving a 1.5°C trajectory. ENGIE should be able to provide a detailed asset-by-asset fossil gas and coal exit plan.(14) There have also been no changes to the company’s coal phase-out dates, nor any commitment to shut down – rather than sell or convert – its coal plants.
A diversification strategy rooted in gas
ENGIE keeps presenting a diversification strategy focused on various gas technologies. Green gases, hydrogen,(15) and biomethane, combined with “carbon removal actions” and “carbon sequestration credits”, are promoted as adequate alternatives.(16) Yet these technologies have significant limitations(17) and risk perpetuating a fossil-based system, given their uncertain development timelines and reliance on the same infrastructure as fossil gas, including power plants and distribution networks.
ENGIE’s 4 GW hydrogen production target by 2035 was delayed by five years at the 2024 AGM due to “major difficulties in developing green hydrogen.”(18)
In line with this strategy, an analysis of the company’s 2025–2027 CAPEX leads to the same conclusion. The share allocated to fossil fuel technologies remains nearly unchanged compared to the 2024–2026 period, contrary to what would be expected from a science-based fossil exit trajectory.
| CAPEX (Md €)(19) | CAPEX (%) | |||
|---|---|---|---|---|
| 2024-2026 | 2025-2027 | 2024-2026 | 2025-2027 | |
| Low carbon energy production | 14.5 | 13 | 57.3 % | 58.8 % |
| Low carbon infrastructures | 2.5 | 2.8 | 9.7% | 15.1% |
| Green gas production (biogas, biomethane and hydrogen) as well as storage capacities such as batteries | 3.5 | 2.5 | 13.6% | 8.4% |
| Fossil generations assets ans gas networks | 2.5 | 2.2 | 9.7% | 9.8% |
| Non taxonomy-aligned CAPEX | 2.5 | 2.0 | 9.7% | 7.9% |
Table 1: ENGIE’s CAPEX distribution for 2024–2026 and 2025–2027
By comparison, energy companies like Iberdrola and Statkraft no longer allocate any CAPEX to fossil power generation.
ENGIE’s categorization also lacks clarity, grouping all so-called “low carbon”(20) technologies together and mixing “green gas” production with battery storage.(21) A more granular breakdown is needed to accurately assess the company’s investment strategy.
A need for greater ambition and transparency
ENGIE’s 2025 climate plan, which will be presented at its AGM, brings very few changes from the previous plan. Continued gas expansion and refusal to manage an early, timed and relevant fossil gas phase-out remain the company’s main climate blind spots, reflected in its key indicators.
The company’s ambition to be a “leader in the energy transition” is undermined by significant delays compared to European electricity producers like Iberdrola, Statkraft, or even Enel(22) – particularly regarding net-zero targets and fossil gas phase-out -, and relative to a 1.5°C-aligned decarbonization pathway.
To live up to such a leadership role, ENGIE would need to adopt a much faster and more ambitious decarbonization policy, beginning with a commitment to end fossil gas expansion.
To push for this progress and enable more frequent revisions of ENGIE’s climate plan, a shareholder coalition urged the company in 2023 to allow an annual vote on its climate plan’s implementation. A resolution to that effect received 24.4% shareholder approval, equivalent to 43% excluding the French state and Caisse des Dépôts.(23) This led Jean-Pierre Clamadieu, chairman of the board, to acknowledge that “a significant portion of shareholders supported this resolution” and that “we will have to take it into account to improve shareholder dialogue.”(24) However, since then, ENGIE’s board has not seen fit to enhance the transparency of the climate plan or its implementation. The findings of this new strategy should prompt the company to reconsider its stance, and shareholders to demand greater transparency.
Recommendations
Face à ce constat, nous appelons l’ensemble des acteurs financiers qui soutiennent ENGIE à exiger de l’entreprise un engagement à ne plus développer d’infrastructures de gaz fossiles, à adopter un plan de sortie du gaz aligné sur une décarbonation du secteur de l’électricité à 2035 / 2040 (24), et à y conditionner l‘accès aux services financiers.
Sans plus attendre, nous appelons aussi les actionnaires d’ENGIE à profiter de l’AG pour sanctionner l’absence de progrès sur le gaz fossile, en votant contre le « Say on Climate » et le renouvellement du mandat de l’administratrice Catherine MacGregor, qui est également la directrice générale de l’entreprise et responsable de la stratégie climatique actuelle d’ENGIE. S’opposer à la réélection d’un administrateur pour des raisons climatiques enverra un signal fort à ENGIE, indiquant que ses actionnaires considèrent la question climatique comme une composante essentielle de la stratégie globale de l’entreprise.
