CANADIAN SOLAR INC. 2023 Sustainability Report
Contents
Forward Looking Statements
This report has been prepared by Canadian Solar Inc. (the "Company" or "Canadian Solar") to facilitate a better understanding of the Company's sustainability strategy and performance. The information contained in this report has not been independently verified. The Company, its affiliates, advisers, directors, and representatives will not be held
be marked by such terms as "believes," "expects," "anticipates," "intends," "estimates," or other comparable terminology. Though the Company considers its expectations expressed
in such forward-looking statements reasonable, it cannot guarantee their realization. The Company refers readers to a more detailed discussion of the risks and
Responsible Supply Chain | 59 | ||
ESG Integration in Supply Chain | 60 | ||
Management | |||
4 | Anti-Modern Slavery Initiatives | 60 | |
Supplier Code of Conduct | 61 | ||
Supplier ESG Audits | 61 | ||
Conflict Minerals | 62 |
liable (whether in negligence or otherwise) for any losses resulting in the use of this report, its contents, or any other associated issues.
Certain statements in this report are forward- looking statements that involve a number of risks and uncertainties that could cause actual results to differ materially. These statements are made under the "Safe Harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements may
uncertainties contained in the Company's annual report on Form 20-F, as well as other documents filed with the Securities and Exchange Commission. Furthermore, all information provided in this report, including forward-looking statements, is as of the date of this report's release on the Company's website unless otherwise stated. The Company undertakes no duty to update such information except as required under applicable law.
Sustainability at Canadian Solar
Approach to Environment, Health, and Safety (EHS) Compliance with Environmental Regulations Circular Economy
International ESG Initiatives
Environment Metrics and Targets
Greenhouse Gas Emissions
Energy Intensity
Water Intensity
Waste Intensity
Product End-of-Life Management and Recycling
Environmental Stewardship in Project
Development and Operations and Maintenance
Climate-Related Risks and Opportunities
Social Responsibility
Working at Canadian Solar Diversity, Equity, and Inclusion
Talent Strategy, Training, and Development Freedom of Association and Collective Bargaining Occupational Health and Safety
Connecting Employees with Our Mission Making a Difference through Community Commitment
9 | Governance | 63 |
12 | ||
12 | Board Committees | 64 |
13 | Summary of Board Members and Duties | 65 |
15 | Diversity of the Board of Directors | 66 |
Board Expertise and Training | 66 | |
Executive Management | 67 | |
18 | Ethical Business Conduct | 69 |
Cybersecurity | 70 | |
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26 | ||
29 | About this Report | 72 |
31 | ||
33 | ||
35 |
Appendix:
38 Global Reporting Frameworks 74
SASB Index | 75 | |
41 | IFRS Disclosures | 77 |
GRI Metrics | 79 |
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Message from Chief Executive Officer | Canadian Solar 2023 Sustainability Report |
Message from Chief Executive Officer
We are delighted to share Canadian Solar's annual Sustainability Report, which showcases the incredible progress we have made as a clean energy company committed to sustainable practices. We continue to embed sustainability deeply within the fabric of our operations and remain unwavering in our commitment to ambitious ESG goals. This report provides a comprehensive overview of our progress and achievements, demonstrating the substantial impacts we have achieved for the environment, our employees, the communities we support, and our stakeholders broadly. We would like to highlight three key areas of focus in this report:
1. We have made significant progress in reducing the environmental impact of our own operations and through technological and operational advancements, continue to help our customers and partners reduce their environmental impact. In 2023, we reduced GHG emissions, energy, water, and waste intensity by 37%, 37%, 72%, and 54%, respectively. We have diligently reported our GHG emissions since 2021. With metrics that now encompass total emissions across scopes 1 and 2, we have also broadened our scope 3 categories to include category 9 (Downstream Transportation and Distribution) and category 13 (Downstream Leased Assets) emissions. We remain firmly on course to power all our operations with 100% renewable energy by 2030.
This year marked significant advancements in both our solar and battery energy storage solutions. We began mass production of our N-type TOPCon solar modules, achieving industry-leading efficiency rates and power ratings. These advancements not only reduce Levelized Cost of Energy (LCOE), but also minimize the environmental impact of solar projects using Canadian Solar's TOPCon modules. In the realm of battery energy storage, we launched a new iteration of our utility-scale product SolBank, enhancing both cost-efficiency and environmental impact.
Furthermore, we advocate for a circular economy, maximizing resource efficiency through the principles of reducing, reusing, and recycling. Both CSI Solar and Recurrent Energy are integrating the recycling of solar modules and battery energy storage components into our operations, collaborating with global third-party partners. For instance, in the U.S., we are negotiating an agreement with a new partner to recycle our solar modules at the end of their life cycle. Additionally, Recurrent Energy is standardizing its decommissioning processes, drawing on the exemplary model from its 98-megawatt Bayou Galion project.
2. We remain firmly committed to a responsible supply chain and have made meaningful progress in ethical labor practices across our own operations and within our supply chain. In 2023, we conducted 129 supplier ESG audits, which included 29 on-site evaluations, an increase from the 122 audits and 17 on-site audits conducted in 2022. Following thorough consultations and the implementation of necessary corrective action plans, all suppliers have met our ESG standards.
Moreover, in 2023, we commenced and successfully completed an RBA VAP audit at our module manufacturing facility in Thailand, where we achieved a silver-level recognition, confirming our adherence to the "Freely Chosen Employment" standards - that is, no forced labor in our operations. In 2024, we began another RBA VAP audit at our cell factory in Suqian, Jiangsu Province, China, and are planning to initiate an additional audit at our ingot factory in Qinghai Province, China, within the year. Additionally, one of our key polysilicon suppliers in Qinghai Province, China initiated an RBA VAP audit upon our recommendation.
3. We have enhanced our disclosures to accurately reflect the ongoing evolution of our business and to improve the transparency of our ESG progress. This year, we have added key environmental metrics for e- STORAGE, recognizing the critical role battery energy storage plays in integrating solar and other renewable energy sources into the power grid, thus increasing the adoption of clean energy globally.
With BlackRock's investment, Recurrent Energy has also intensified its focus on establishing and achieving its ESG targets. In 2024, we are dedicated to enhancing our climate risk program to align with stakeholder expectations. We have initiated a standalone ESG strategy for Recurrent Energy, underpinned by a double materiality assessment conducted in partnership with a third-party sustainability firm, adhering to the European Union's Corporate Sustainability Reporting Directive (CSRD).
As we move forward, our focus remains on intensifying our ESG initiatives, leveraging innovative technologies, and enhancing stakeholder engagement. We thank you for your continued trust and support in Canadian Solar, as we work together to foster a more sustainable future.
Shawn Qu
Chairman and Chief Executive Officer
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Canadian Solar 2023 Sustainability Report
Highlights | About Canadian Solar | Environmental Metrics and Targets | Social Responsibility | Responsible Supply Chain | Governance | About this Report | Appendix |
Highlights
23-year
Global tier 1 player in solar and battery storage 100% revenues related to renewable energy
> 32 million
Households powered
World Class Brand
Tier 1 Solar Company,
BloombergNEF (2017-2023)
Tier 1 Energy Storage
Manufacturer,
BloombergNEF (2Q 2024)
Top Brand PV USA, EUPD
Research (2024)
> 22,000
Employees worldwide, 32% is female
> 10 GWp
Solar project developed and connected
Low Carbon Foorprint
From French ECS, Italian EPD and South Korean KNREC lifecycle certifications for solar modules
125 GW | 350 million |
Solar modules | Tons of CO₂ emissions |
delivered | displaced |
> 3 GWh | 1 Year |
Battery energy storage | Solar modules |
projects energized | greenhouse gas |
payback time |
ISO Certifications
ISO9001 Quality management system
ISO14001 Environmental management system
ISO45001 Occupational health and safety system
ISO50001 Energy management system
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Canadian Solar 2023 Sustainability Report
Highlights | About Canadian Solar | Environmental Metrics and Targets | Social Responsibility | Responsible Supply Chain | Governance | About this Report | Appendix |
Highlights
Circular Economy | International ESG Initiaves and Recognitions |
Product R&D | Contributor to United Nations Sustainable Development Goals (UN SDGs) |
2017-2023 energy conservation and emission reductions | |
37% decrease in GHG emissions intensity | |
37% decrease in energy intensity | |
72% decrease in water intensity | |
54% decrease in waste intensity | |
Packing materials 100% recycled or reused in 2023 | |
Product end-of-life management plan in place |
ESG Goals
From 2023 to 2028, targeting:
22% decrease in GHG emissions intensity
22% decrease in energy intensity
15% decrease in water intensity
20% decrease in waste intensity
Powering global operations with 100% renewable energy before 2030
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Canadian Solar 2023 Sustainability Report
Highlights | About Canadian Solar | Environmental Metrics and Targets | Social Responsibility | Responsible Supply Chain | Governance | About this Report | Appendix |
Highlights
International ESG Initiaves and Recognitions
ISS ESG | EcoVadis Silver Sustainability Rating | Achilles ESG Assessment | Environmental Finance |
Prime Rating, Industry Top 5% (2024) | Industry Top 5% (2024) | Excellent Rating | Green Project Bond of the Year (2024) |
UNEF | United Nations Global Compact (UNGC) | Solar Stewardship Initiative | Environmental Finance |
Seal of Excellence for Sustainability (2024) | Active Participant | Membership (2024) | Sustainability Reporting of the Year (2023) |
Science-Based Targets initiatives | RBA VAP Audits | CDP Climate Change disclosure |
Near-term and Net Zero Targets | In Progress (2024) | |
committed |
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Canadian Solar 2023 Sustainability Report
Highlights | About Canadian Solar | Environmental Metrics and Targets | Social Responsibility | Responsible Supply Chain | Governance | About this Report | Appendix |
About Canadian Solar
Canadian Solar Inc. (the "Company" or "Canadian Solar") was founded in 2001 in Canada and is one of the world's largest solar technology and renewable energy companies. It is a leading manufacturer of solar photovoltaic modules, provider of solar energy and battery energy storage solutions, and developer of utility-scale solar power and battery energy storage projects with a geographically diversified pipeline in various stages of development. Over the past 23 years, Canadian Solar has successfully delivered over 125 GW of premium- quality, solar photovoltaic modules to customers across the world. Likewise, since entering the project development business in 2010, Canadian Solar has developed, built, and connected over 10 GWp of solar power projects and 3.3 GWh of battery energy storage projects across the world. Currently, the Company has over 1.2 GWp of solar power projects in operation, 6.5 GWp of projects under construction or in backlog (late-stage), and an additional 19.8 GWp of projects in advanced and early-stage pipeline. In addition, the Company has 600 MWh of battery energy storage projects in operation and a total battery energy storage project development pipeline of around 56 GWh, including approximately 4.3 GWh under construction or in backlog, and an additional 51.6 GWh at advanced and early-stage development. Canadian Solar is one of the most bankable companies in the solar and renewable energy industry, having been publicly listed on the NASDAQ since 2006.
In this Section | 7 |
Sustainability at Canadian Solar | 9 |
Approach to Environment, Health, and Safety (EHS) | 12 |
Compliance with Environmental Regulations | 12 |
Circular Economy | 13 |
International ESG Initiatives | 15 |
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About Canadian Solar | Canadian Solar 2023 Sustainability Report |
The Company has two business segments: CSI Solar and Recurrent Energy.
CSI Solar consists of solar module and battery energy storage manufacturing, and delivery of total system solutions, including inverters, solar system kits, and EPC (engineering, procurement, and construction) services. CSI Solar's e-STORAGE branded battery energy storage business includes its utility-scale turnkey battery energy system solutions. These systems solutions are complemented by long-term service agreements, including future battery capacity augmentation services.
Recurrent Energy is one of the world's largest clean energy project development platforms with 15 years of experience, having delivered over 10 GWp of solar power projects and 3.3 GWh of battery energy storage projects. It is vertically integrated and has strong expertise in greenfield origination, development, financing, execution, operations and maintenance, and asset management.
North America
Canada | U.S. |
Guelph: Global HQ | Austin: North America HQ |
Mesquite, Texas | |
Jeffersonville, Indiana | |
Walnut Creek | |
San Francisco | |
New York City |
Latin America
Brazil
São Paulo
Mexico
Mexico City
Colombia
Bogotá
Chile
Europe
Germany | Spain | France |
Munich: EMEA CSIS HQ | Madrid: EMEA RE HQ | Biarritz |
Frankfurt | Servilla | Netherlands |
U.K. | Barcelona | Amsterdam |
London | Badajoz | |
Colchester | Italy | |
Poland | Milan | |
Warsaw | ||
Asia Pacific
P.R. China
Suzhou: China HQ
Yancheng
Yangzhou
Funing
Suqian
Luoyang
Baotou
Hohhot
Jiaxing
Xining
Beijing
Jinan
Guangzhou
Kunming
Wuhan
Wuhu
Hong Kong, SAR
Taiwan, China
Hsinchu
Japan
Tokyo
Osaka
South Korea
Seoul
Gwangju
India
New Delhi
Thailand
Chonburi
Vietnam
Hai Phong
Malaysia
Kuala Lumpur
Singapore
Singapore
Australia
Melborne
Sydney
Santiago
Middle East U.A.E. | South Africa | |
and Africa | Dubai | Cape Town |
Manufacturing operations
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About Canadian Solar | Canadian Solar 2023 Sustainability Report |
Sustainability at Canadian Solar
As a global leader in the renewable energy industry, Canadian Solar derives 100% of our revenues from renewable energy. Canadian Solar is committed to powering the world with solar energy and creating a cleaner earth for future generations. At Canadian Solar, we are committed to improving our practices to ensure long-term sustainability by integrating Environmental, Social, and Governance (ESG) considerations into our business and strategic decisions.
Environmental
Working sustainably within our planetary boundaries
GHG emissions and manufacturing energy intensity Commitment to 100% renewable energy before 2030 Solar PV system carbon payback time of 1 year Water intensity management
Material use, waste, and circularity
Environmental stewardship in project development Assessing climate risks and opportunities
Social | Governance | |
Committing to socially responsible | Demonstrating responsible | |
and equitable outcomes | conduct | |
Human rights | Policies and procedures | |
Equal opportunity employer | Board level oversight | |
Equity, diversity, and inclusion | Appropriate due diligence processes | |
Talent strategy, training, and development | Responsible supply chain management | |
Freedom of association and collective bargaining | Robust ESG reporting | |
Occupational health and safety | Transparency and risk management | |
Community commitments and partnerships | ||
The following corporate policies provide a framework for Canadian Solar's sustainability commitments:
Environmental | Social | Governance |
Environment, Occupational | Labor and Human Rights Policy (link) | Code of Business Conduct and Ethics (link) |
Health, and Safety Policy (link) | Equal Employment Opportunity Policy (link) | Whistleblower Policy (link) |
Anti-Modern Slavery Policy (link) | Insider Trading Policy (link) | |
Diversity Policy (link) | Related-Party Transactions (link) | |
Supplier Code of Conduct (link) | Prohibition against Giving Bribes (link) | |
Conflict Minerals Policy (link) | Prohibition against Accepting Bribes (link） |
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About Canadian Solar
Sustainability at Canadian Solar
At CSI Solar, we are firmly committed to minimizing the environmental footprint of our operations and products. From product R&D to manufacturing and end-of-life management, we proactively strive to prevent pollution, optimize energy use, responsibly manage waste, all of which contribute to a more sustainable future. The total electricity generated by 125 GW of our cumulative solar modules shipped over the past 23 years is equivalent to displacing approximately 350 million tons of CO₂ emissions or powering over 32 million households.
Recurrent Energy shares this commitment to sustainable practices across our operations. In addition to developing, owning, and operating energy projects that reduce carbon emissions, we prioritize sustainability in our day-to-day operations. We have developed and connected over 10 GW of solar power projects and more than 3 GWh of battery energy storage projects worldwide. The energy generated by these facilities amounts to approximately 78,000 GWh, equivalent to offsetting 41 million tons of CO₂ emissions or supplying power to around 2.5 million households.
Canadian Solar Green Financing Framework
As part of our long-standing commitment to sustainability, we have updated our Green Financing Framework (link) in 2024. This comprehensive update extends beyond project development to encompass the entire spectrum of our operations, including both solar and battery energy storage project development, as well as product manufacturing. Both the previous and current versions of our framework have received a second-party opinion (link) from Sustainalytics, a leading firm in ESG and corporate governance research and analytics.
The new framework is aligned to the International Capital Market Association (ICMA) Green Bond Principles (GBP) 2021, amended in June 2022, aiming to encompass future issuances in the capital markets, and the Green Loan Principles (GLP) updated in February 2023 published by the Loan Market Association (LMA), Loan Syndications and Trading Association (LSTA) and the Asia Pacific Loan Market Association (APLMA), aiming to encompass bilateral or syndicated loans with financial institutions and/or multilateral agencies.
300 MW /561 MWh, Slate Solar and Battery Energy Storage Plant, U.S.
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Canadian Solar Inc. published this content on 31 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 May 2024 08:02:09 UTC.
