ESG Controversies & Accountability

Updated March 2026

With the aim of ensuring greater transparency and granting additional context, EDP has set this section regarding specific material ESG controversies identified by external ratings agencies, including current status, our position, and corrective measures taken. This page is updated on a continuous basis.

ESG principles, policies, and practices play an essential role and increase their importance in the company strategies to address the needs and interests of their stakeholders.

However, these initiatives may not always avoid an ESG controversy. Sometimes, these controversies could result in the payment of fines.

Controversy	Topic	Geography	Analyst	Opening Date	Status
CMECs	Bribery and Corruption	Portugal	Sustainalytics & MSCI	02-06-2017	Ative
Pedrógão fire	Quality and safety	Portugal	Sustainalytics	03-06-2017	Closed
São Manoel	Community Relations	Brazil	MSCI	18-07-2017	Closed
Douro dams sale	Accounting and taxation	Portugal	Sustainalytics	23-03-2023	Ative
Wildcat Creek	Community Relations	South Central (US)	Sustainalytics	21-12-2021	Ative
Privacy - Spain (GDPR)	Data Privacy and Security	Spain	Sustainalytics	22-02-2022	Closed
Privacy - Spain (GDPR)	Data Privacy and Security	Spain	EcoVadis	22-02-2022	Ative
Fire in Monchique	Quality and safety	Portugal	Sustainalytics	25-07-2018	Ative
Continente case	Anti-competitive practices	Portugal	Sustainalytics	05-05-2017	Closed
Protest by EDP employees	Labour Relations	Portugal	Sustainalytics	04-09-2014	Ative
Competition Authority	Environment	Portugal	EcoVadis	2019	Closed
Protest by EDP employees	Human rights	Portugal	EcoVadis	July 2024	Active
Competition Authority	Ethics	Portugal	EcoVadis	June 2024	Ative
Regulator	Ethics	Portugal	EcoVadis	2020	Closed
Mogi das Cruzes	Risk & Customer Relations	Brazil	S&P	04-08-2025	Active

Controversies

Tax controversy regarding sale of hydro portfolio

In December 2020, EDP sold a portfolio of Hydro Power Plants in Portugal to a French consortium led by ENGIE. There is an ongoing investigation process about the tax implications of the transaction. As always, EDP is collaborating with the authorities. EDP understands, considering reputable experts’ opinion, that the operation met all legal and tax.

See more details on page 332

ESG Severity
Sustainalytics Category 2 — Moderate
Background
EDP sold six Douro hydro dams to an Engie‑led consortium for €2.2bn (Dec 2020–Jan 2021). Authorities alleged the structure avoided over €335m in taxes, including ~€110m in stamp duty.
EDP's Position
EDP states the sale met all legal requirements and reflected standard market practice, fully cooperating with the Tax Authority search in July 2021. In Nov 2025, prosecutors ordered €335.2m in taxes
Measures adopted
-Full cooperation with Tax Authority investigation (since July 2021)

-Public Prosecutor ordered EUR 335.2M tax collection (Nov 2025)

-Legal proceedings ongoing regarding tax liability determination
Current status
Active investigation. Public Prosecutor ordered EUR 335.2M tax collection (November 2025). Final judicial resolution pending

Investigation process about CMEC and DPH

On 2 June 2017, EDP was made aware of the investigation being carried out by the DCIAP since 2012 regarding the amounts due to EDP for the early termination of the CAEs and the right of use over the DPH. The procedure is still under investigation and until the present date there are no relevant developments or explanations on why EDP is a defendant. For further information, please see the latest update regarding this matter as well as EDP’s market notifications and public positioning.

See more details on 435-436

ESG Severity
Sustainalytics Category 3 — Significant
Background
EDP and former executives are under investigation by Portuguese prosecutors (DCIAP) over the CMECs mechanism, with allegations that over EUR 2bn in excess costs were passed on to electricity consumers
EDP's Position
EDP states the CMECs mechanism was legal, fully cooperates with the investigation, and no formal charges have been filed against the company.
Measures adopted
-Revised Anti-Bribery & Corruption Policy (2024)

-Enhanced Whistleblower Programme certified to ISO 37002

-Mandatory ethics training for all executives

-Full cooperation with DCIAP investigation
Current status
Investigation ongoing. Former CEOs of EDP and EDP Renováveis named as suspects (July 2020). No final judicial decision. 

Abuse of market position

This case is related to the bidding strategy in the ancillary services market of EDP Produção's power plants. According to the AdC - Competition Authority, between 2009 and 2013, EDP Produção would have limited the supply of secondary reserves by the power plants under the CMEC - Contractual Balance Maintenance Costs regime. In this context, the AdC imposed a fine of €48 million on EDP Produção, which was confirmed by the Competition Regulatory and Supervisory Court (TCRS), following the appeal filed by EDP Produção.

See more details on 330-331

ESG Severity
Sustainalytics Category 1 — Low | EcoVadis Major Impact (expiry 06/2034)
Background
In Sept 2019, the Portuguese Competition Authority fined EDP Produção €48m for alleged abuse of dominance in the secondary reserve market (2009–2013), involving hydro capacity under the CMEC regime.
EDP's Position
EDP contested the decision through all judicial channels. In May 2024, the Constitutional Court upheld the AdC ruling, confirming the fine. EcoVadis classified it as a Major ethics controversy.
Measures adopted
-Fine paid following Constitutional Court confirmation (May 2024)

-Enhanced compliance and competition law training programmes

-Review of commercial practices in regulated and open markets
Current status
Fine confirmed final by Constitutional Court (May 2024). EcoVadis monitoring active until 06/2034. Sustainalytics: Anti-Competitive Practices Category 1 Low.

Commercial Campaign EDP/Continente Plan

EDP, S.A. and EDP Comercial were charged by the Portuguese Competition Authority (AdC) with entering into an alleged non-compete agreement with Sonae MC - Modelo Continente. This decision was appealed before the Portuguese Competition, Regulation and Supervision Court (TCRS), which reduced the fines by 10%, to EUR 2.6 million and EUR 23.2 million, respectively. This TRCS decision was appealed before the Lisbon Court of Appeal (TRL). In April 2021, this court referred the case back to the Court of Justice of the European Union. The judgment of the Court of Justice of the European Union was delivered on 26 October 2023, referring a final decision on some of the questions to the TRL. On 19 February, the Lisbon Court of Appeal issued a judgment confirming the TCRS's sentence. See more details

See more on page 153

ESG Severity
Closed — Sustainalytics
Background
In 2017, the Portuguese Competition Authority fined EDP and SONAE €38.3m for alleged non‑compete practices. The decision was upheld on appeal with a 10% fine reduction and reviewed by the Lisbon Court
EDP's Position
EDP contested the decision and cooperated with all judicial proceedings. The case is now fully resolved with all judicial appeals exhausted.
Measures adopted
-Fine paid following final court decision

-Competition law compliance training reinforced

-Commercial agreements reviewed and aligned with competition regulations
Current status
Case closed. All judicial proceedings concluded. Sustainalytics no longer monitors this case.

Transparency and Dialogue: Regulatory Controversies in São Paulo

EDP São Paulo faces regulatory actions in several municipalities, focusing on the maintenance of electrical infrastructure and pole sharing. The company has implemented emergency and preventive measures. In May 2025, ANEEL recommended the renewal of its concession contract, based on compliance with performance indicators. The page linked below gathers information on controversies and measures adopted, reflecting EDP’s commitment to transparency.

ESG Severity
S&P Active (opened 04-08-2025)
Background
EDP São Paulo faces regulatory actions on grid maintenance and pole sharing. In Oct 2024, ANEEL imposed a R$16m fine over service quality deterioration (TMP/TMAE) after a 2023 severe weather event.
EDP's Position
EDP São Paulo contested the fine, citing compliance with DEC and FEC indicators. A Federal Court temporarily suspended it in Nov 2024, and in May 2025 ANEEL recommended renewal of the concession.
Measures adopted
-Emergency and preventive maintenance implemented

-R$24.5m investment in Mogi das Cruzes substation (H2 2025)

-ANEEL recommended concession renewal (05.25)

-Caraguatatuba civil action suspended (02.25
Current status
S&P active monitoring (opened 04-08-2025). ANEEL fine partially suspended. Concession renewal recommended. Settlement negotiations ongoing.

São Manoel dam in Brazil

The São Manoel Hydroelectric Power Plant was built a few kilometres from the border of the Kayabi Indigenous Territory, inhabited by three ethnic groups (Kayabi, Apiaká and Munduruku). The only indigenous manifestation involving the São Manoel Hydroelectric Plant took place at the end of 2017 and the claims were not related to environmental actions implemented by the Company. The controversial fact corresponds to an isolated event and currently there is no other manifestation, and all actions foreseen in its Environmental Licensing Process are being implemented.

ESG Severity
Closed — MSCI
Background
The São Manoel Hydroelectric Plant was built near the Kayabi Indigenous Territory in Mato Grosso. Indigenous groups raised concerns about the proximity of construction to their lands.
EDP's Position
EDP states the only indigenous protest occurred in late 2017 and was unrelated to its environmental actions. All required environmental studies and consultations were conducted under Brazilian law.
Measures adopted
-Full compliance with FUNAI consultation requirements

-Establishment of community relations monitoring programme

-Investment in local community development initiatives
Current status
Case closed by MSCI. No active legal proceedings or ongoing community disputes.

Vegetation management

E-REDES and some of its employees were involved in two legal cases related to the wildfires of 2017 (Pedrógão Grande) and 2018 (Monchique). In the Monchique case, the fact-finding hearing was held in 2022, during which E-REDES and an employee presented witnesses and evidence already included in their written defence. Based on this, the judge decided not to indict them. As no appeal was filed, the decision became final. In the Pedrógão Grande case, several individuals, including two E-REDES employees, were tried. The court concluded that no one was guilty. Although appeals were lodged, none challenged the acquittal of the E-REDES employees.

See more details on page 14.

ESG Severity
Sustainalytics Category 1 — Low
EDP's Position
EDP Distribuição contested the allegations, stating the fire did not originate from its power line. All eleven defendants, including two EDP managers, were fully acquitted by the Leiria Court in Sep22
Background
In June 2017, a wildfire near Pedrógão Grande killed 66 people. Investigators linked ignition to a 15kV EDP‑managed line; three managers were indicted for alleged negligent vegetation maintenance.
Measures adopted
-Increased annual investment in vegetation clearance to €5M+

-Aerial surveillance expanded to 14,000 km

-Drone and laser inspection implemented

-Active cooperation with Civil Protection authorities
Current status
All defendants acquitted (September 2022). Sustainalytics maintains Category 1 Low monitoring due to ongoing reputational risk. No pending legal proceedings against EDP.