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2023-03-31-accounts

COMPANY NO. 12914740 CHARITY NO. 1194424

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE) FINANCIAL STATEMENTS 31 MARCH 2023

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

CONTENTS OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

CONTENTS
COMPANY INFORMATION 1
REPORT OF THE DIRECTORS 2
STATEMENT OF DIRECTORS’ RESPONSIBILITIES 17
INDEPENDENT AUDITOR’S REPORT 18
INDEPENDENT AUDITOR’S REPORT 19
INDEPENDENT AUDITOR’S REPORT 20
STATEMENT OF FINANCIAL ACTIVITIES 21
BALANCE SHEET 22
STATEMENT OF CASH FLOWS 23
NOTES TO THE FINANCIAL STATEMENTS 24

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE) COMPANY INFORMATION FOR THE YEAR ENDED 31 MARCH 2023

PRINCIPAL & REGISTERED OFFICE:

AUDITORS:

28 St. John's Square London EC1M 4DN Crowe U.K. LLP Aquis House 49-51 Blagrave Street Reading Berkshire RG1 1PL

BANKERS:

Unity Trust Bank PO Box 7193 Planetary Road Willenhall WV1 9DG

SOLICITORS

Orange Grove Law 20 Red Lion Street London WC1R 4PS

Bates Wells 10 Queen Street Place London EC4R 1BE

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS

FOR THE YEAR ENDED 31 MARCH 2023

The Trustees, who are also Directors of the charity, submit their report together with the audited financial statements for the year ended 31 March 2023, and confirm that they comply with the requirements of the Charities Act 2011 and the Companies Act 2006, thus including the Directors’ Report and Strategic Report under the 2006 Act, together with the audited financial statements for the year.

REFERENCE AND ADMINISTRATIVE INFORMATION

TransitionZero is a charitable company limited by guarantee, company registration number 12914740, charity registration number 1194424.

The company, not having a share capital, is limited by guarantee. Each member’s liability is limited to an amount not exceeding £1 in the event of the company being wound up.

The present Trustees, and any past Trustees who served during the year, are given on page 16, together with the names of the senior executive staff. The principal place of business is stated on page 1.

STRUCTURE, GOVERNANCE AND MANAGEMENT

Governing Document

The company is governed by its Memorandum and Articles of Association dated 30 September 2020.

Governing Body

The Board of Trustees is responsible for the overall governance of the Charity. Existing trustees appoint new Trustees, and the appointment is minuted.

Recruitment and Training of Trustees

Potential Trustees are identified by existing trustees and are considered against the board’s specifications concerning eligibility, competence, specialist skills and local availability. Training has been provided to all new appointees on their obligations as a Trustee. Materials are available to the Trustees on general legal obligation applicable to the organisation.

Organisational Management

Within the organisational structure, day-to-day decision-making is delegated to the staff. Up until August 2022 it was delegated to the two co-CEOs; following Sriya Sundaresan’s resignation, Matthew Gray took over as sole CEO and key decision-making was delegated to him. Following a reorganisation, to assist the CEO in day to day decision making and lead specific functions within the organisation, Hristina Petkova was promoted to Head of Operations (previously Operations Manager), Lucas Kruitwagen was hired as Head of Technology, and Sebastian Kennedy as Head of Insights. The Board decides matters of governance and is in charge of ensuring that the charity is carrying out its purposes for the public benefit.

The CEO oversees the work of the core four functions within the organisation: Technology, Insights, Analysis, and Operations. The CEO in turn reports directly to the Trustees in the following ways:

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Four key functions emerged following TransitionZero’s reorganisation: Technology, Insights, Analysis, and Operations. The CEO oversees these functions while the day to day management and objective setting sits with the department leads. The organisation also refined its strategy to focus on building an open-source energy system model without usability compromises and creating a user network effect through a scalable partnership model to support the development of a global standard for energy transition planning data. In order to execute the revised strategy, the organisation further professionalised and expanded the Operations function, built out its data infrastructure, and continues to develop its partnerships. Specific updates regarding strategic aims and impact are detailed further down in this report.

TransitionZero grew its operations function to support the reorganisation and growth across the organisation. The operations team comprises the Head of Operations, People and Operations Coordinator, and Financial Controller.

With regard to people and culture management, we reviewed and updated internal policies and procedures to reflect the growth of the organisation better and addressed any gaps identified along the way. To support the reorganisation, we wanted to achieve consistency, transparency, and sustainability across the internal policies and procedures:

Notably, we developed and introduced brand new performance management and salary grading policies and procedures. To underpin this roll out, we updated everyone’s job descriptions and ensured that they outline main responsibilities in the context of the wider organisation. Job descriptions will be reviewed during annual performance reviews or whenever there has been a significant change in an individual’s job title, duties and responsibilities. We also introduced the Objective & Key Result (OKR) method as a way to track outcomes and performance. OKRs are developed by managers on a quarterly basis in line with company and function strategies. Our performance management system and salary grading structure will enable and support the continuous growth of the organisation and have set high standards as we seek to achieve multiple objectives through them:

In line with our reorganisation, we also expanded our tech team. We conducted a major hiring drive in November and December 2022. Following concentrated recruitment efforts, in various stages of early 2023, we will welcome two Python Analysts, a Front End Developer, a Data Engineer, an Energy Systems

Modeller Lead and Analyst, and a South East Asia Analyst, and an Engagement Analyst. Hiring at this rate has been instrumental to expanding our tech team as well as to the development and continuous improvement of our hiring procedures and the type of recruiting experience we want to give applicants.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

On the financial management side of the organisation, we undertook a full review of our financial procedures and processes. We have successfully identified a clear and well-managed path forward in terms of managing our finances. The financial function of the organisation is now fully managed inhouse with the Financial Controller performing all accounting and bookkeeping operations. In addition, the Financial Controller performs and maintains financial forecasts and budgets. We review all expenditures on a monthly basis and allocate each transaction to appropriate grants. Importantly, we have set out to provide monthly financial reports to the CEO to enable well informed financial decisions and future planning.

The CEO report includes:

The monthly management accounts provide a general overview of the financial health of the organisation; forecasts ensure sustainable financial planning in line with set objectives. The grant balances report ensures that we are on track with the spend of our grants and provides clear short and long term visibility which in turn reduces the risk of over or under spending.

Key Management Personnel Remuneration

The trustees consider the board of trustees, CEO, and Heads of Departments as comprising the key management personnel of the charity, having authority and responsibility for planning, directing and controlling the activities of the charity, directly or indirectly, on a day to day basis. All trustees give of their time freely and no trustee remuneration was paid in the year. Details of trustee expenses and related party transactions are disclosed in notes 5 and 13 to the accounts.

The pay of the charity’s key staff management personnel is reviewed annually. The Board reviews and compares the CEO’s remuneration to that in other similar non-profit or public sector organisations.

Risk Management

The board has examined the principal area of the charity’s operations and considered what major risks may arise in each of these areas. In the opinion of the Trustees, the charity has established resources and review systems, which under normal conditions, should allow the risks identified by them to be mitigated to an acceptable level in its day-to-day operations.

Principal risks and uncertainties have been identified

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Fundraising

TransitionZero does not raise funds from the general public, does not employ a professional fundraiser nor engage the services of third-party organisations to help raise funds, and therefore have not considered it necessary to sign up to any regulatory code of fundraising practice. No complaints have been received during the year about any aspect of the fundraising and consideration is always given to privacy and diplomacy to ensure approaches for fundraising are appropriate.

OBJECTS, AIMS, OBJECTIVES & ACTIVITIES

Charitable Objects

The company’s declared objectives are the promotion of conservation, protection and improvement of the environment, in particular by promoting the reduction of carbon emissions and the improvement of air quality.

The advancement of education and promotion of research into environmental protection and sustainable development in subjects including but not limited to clean energy, air pollution, renewable technologies and sustainable finance. For the purposes of this definition, “sustainable development” means development which meets the needs of the present without compromising the ability of future generations to meet their own needs.

Strategic Aims and Intended Effect

TransitionZero’s mandate is to create open data products to enable the access and adoption of fundamental climate data. We create publicly available outputs to facilitate this access. From professionalising our back-office to building out our data infrastructure, and developing partnerships, this year was transformational for the organisation as we developed and started the successful execution of our updated strategy. Specific updates include:

  1. Strategy update: we refined our strategy to focus on 1) building an open-source energy system model without usability compromises, and 2) creating a user network effect through a scalable partnership model to support the development of a global standard for energy transition planning data.

  2. Operations update: please refer to the Organisational Management section of this report.

  3. Data infrastructure: We have made considerable progress developing our data stack to ensure our models can respond to bespoke requests in 1-2 days rather than weeks or months.

  4. Modelling development: We have been developing our energy system and asset models as well as responding to partner requests to ensure we have an impact before our models are published.

  5. Partnerships: A scalable partnership model is a core feature of our revised strategy, due to our size, location and brand. We have already secured several partnerships to ensure our data is used and we are in continuous conversations with multiple potential partners.

  6. Communications: We have been expanding the reach of our digital communications operations with a new content production strategy, in addition to the existing communications and marketing operation. Increasing the frequency and analytical sophistication of written outputs is expected to grow TransitionZero’s readership significantly, engage a wider audience and introduce the organisation’s products to new stakeholders and market participants.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Objectives for the Year

Transition Zero’s Objects stated in its Articles of Association are:

2.1 the promotion of conservation, protection and improvement of the environment, in particular (but not limited to), by promoting the reduction of carbon emissions and the improvement of air quality; and

2.2 the advancement of education and promotion of research into environmental protection and sustainable development in subjects including but not limited to clean energy, air pollution, renewable technologies and sustainable finance. For the purposes of this Article 2, “sustainable development” means development which meets the needs of the present without compromising the ability of future generations to meet their own needs.”

Strategies to Achieve the Year’s Objectives

To achieve our charitable objectives, we are building an open-source energy system model without usability compromises and creating a user network effect through a scalable partnership model to support the development of a global standard for energy transition planning data. As detailed in the next section of this report, we have already made good progress on both model and partnership development. Figure 1 below includes a summary of our theory of change.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE) REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Figure 1. TransitionZero’s theory of change

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

REVIEW OF ACHIEVEMENTS AND PERFORMANCE FOR THE YEAR

Data infrastructure : Our ‘platform’ is the data stack[1] that allows us to do efficient, novel, reproducible and extensible research and analysis. It consists of code repositories, databases, cloud computation services, and all the various connecting infrastructure and orchestration processes. We are upskilling a cross-disciplinary team that now includes machine learning engineers, data scientists, data engineers, python analysts and developers.

Since mid-2022, we separated from being contributors to the ClimateTRACE platform hosted by WattTime to building our own platform outright.[2] Our data infrastructure now consists of three central pillars: activity data (e.g. generation, emissions, and market data), scraped from various sources daily; asset-level-data, the location and property data of real-economy assets across our coverage sectors, updated approximately quarterly; and finally the ‘sticky’ data relating to technology parameters, policies, contracts, and socioeconomic statistics of our geographies and individual assets of interest. Our platform allows no-code users to contribute to and track this ‘sticky’ data, while power users and programmatic applications have access to all data via a new API. This data infrastructure feeds our machine learning research and systems modelling activities and our new front-end user interface.

We’ve hired a front-end developer to help us deliver new insights to our users and the general public. We’re building a data insights user interface - capable of rendering systems modelling results and giving users access to the assumptions and input data. This is best-in-class openness for systems modelling, far beyond what the likes of incumbent energy companies and international agencies make available.

Our machine learning team has begun two new lines of research: first, into how to best accelerate the optimisation algorithms for our systems models; second, a long-term research plan for cutting-edge training and deployment of computer vision models with earth observation imagery for asset localisation and land-cover studies. All systems models are bottlenecked (in scope and sensitivity sampling) by the speed of solution finding. Expensive commercial models dominated this space until the last two years, when research by DeepMind showed the competitive performance of a suite of deep-learning models. Our machine learning team is now reproducing and expanding on this work. Meanwhile, our earth observation work will continue to focus on the large-scale deployment of computer vision models, the detection of large fixed-point emitters, and the analysis and discovery of their features and activity.

Modelling development: The system modelling team is responsible for the development of the Future Energy Outlook (FEO) platform and its interaction with our asset-level tools, the Coal Asset Transition (CAT)

1 A data stack is like a kitchen for data. Think of how you bake a cake. The ingredients become a cake after going around the kitchen. Most cake ingredients are inedible by themselves, but after spending some time in the kitchen with a cook, they are transformed from inedible ingredients to a cake. And that is the key: unstructured data are unusable like cake ingredients are inedible. But after journeying through a data stack, this data gets turned into insights, easily digestible by a wider variety of stakeholders.

2 Please note: we are still a coalition partner to Climate TRACE and supply emissions data for electricity generation and heavy industry.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Tool and the Steel Asset Transition (SAT) Tool. We are utilising OSeMOSYS Global and PyPSA meets Earth, as they are already among the most widely used open-source energy modelling frameworks. Per the data infrastructure update, we plan to improve the assumptions of OSeMOSYS and PyPSA and, to reduce usability compromises, create an API and UI based on a modern data stack. By minimising usability compromises, we can offer flexible and timely solutions for our partners.

Partnerships: We have already secured several partnerships to ensure our data is used, including:

We are also in continuous conversations with other partners; details of these partnerships will be posted on our website.

Insights and communications update: We have been expanding the reach of our digital communications operations with a new content production strategy, in addition to the existing communications and marketing operation.

This strategy is being implemented by our new Head of Data Insights, who started in this newly created role in November. Adding a dedicated analytical writing resource has enabled the organisation to improve the consistency and rigour of its in-depth blogs and insights, and bring to life the data and tools being created by the tech and infrastructure teams.

The new content strategy prioritises the production of blogs and written outputs analysing short-term movements in global energy markets. As well as leveraging existing datasets such as the Coal-to-Clean Price Index (CCPI) and tools such as Climate TRACE, this strategy involves developing new user dashboards to track the profitability of gas and coal-fired power stations in key markets in Europe and Asia.

Increasing the frequency and analytical sophistication of written outputs is expected to grow TransitionZero’s readership significantly, engage a wider audience and introduce the organisation’s products to new stakeholders and market participants.

3 Press release

4 Press release

5 Press release

6 Press release

7 Press release

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Outputs

Notable outputs from the last year:

Communications metrics

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Data downloads

Public Benefit

The Trustees consider that the activities carried out by Transition Zero during the past year illustrate that they have provided considerable benefit to the public as summarised above. The Trustees have therefore complied with their duty in section 17(5) of the Charities Act 2011 to have due regard to the Charity Commission’s published general guidance concerning the operation of the public benefit requirement under that Act.

RELATED PARTIES AND OTHER ORGANISATIONS

There are no related parties. TransitionZero works primarily with its Funders to deliver its objectives. Our current funders are:

TransitionZero also works with Subak, an accelerator for climate not-for-profits. This allows for collaborations with other think tanks and organisations focused on climate change in order to avoid duplication of work and maximising opportunities for impact.

FINANCIAL REVIEW AND RESULTS FOR THE YEAR

Income for the year amounted to £1,953k of grant income (18 month period ending 31 March 2022 was £2,484k of which £2,457k was grant income).Expenditure for the year was £1,925k, leaving £869k total funds held by the charity at the year end (18 month period ending 31 March 2022 was £1,643k). By far the largest element of expenditure was the cost of employing our staff to provide the activities of the charity.

Principle sources of funding were from Quadrature Climate Foundation, ClimateWorks Foundation via Bloomberg Philanthropies; WattTime Corporation via the Climate TRACE coalition, European Climate Foundation, Client Earth. Please see below for background of how funding supports our objectives.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

emissions with unprecedented detail and speed. Climate TRACE harnesses satellite imagery and other forms of remote sensing, artificial intelligence, and data science expertise to identify human-caused GHG emissions when and where they happen. The sub-grant is e for the purposes of supporting the completion of Phase 5 deliverables for Climate TRACE; TransitionZero is providing emissions for power generation and selected heavy industry subsectors and will support the ClimateTRACE deliverables as follows:

Reserves Policy

The amount of total funds held by the charity at the year end was £869,356 . The amount of funds which are restricted and not available for general purposes of the charity at the year end were £243,168 .

Our Board of Trustees mandates that we must have at least 3 months cash in hand at all times to support financially sustainable decision making when it comes to taking on new projects, hires and growth of the organisation. So far, we have never dropped below this threshold.

FUTURE PLANS

In line with our updated Theory of Change, we believe that ambitious and urgent policy changes are required to make clean energy affordable and dependable for everyone. For instance, analysis finds direct capital expenditure for decarbonisation needs to triple in 2021 to 2025 compared to 2016 to 2020 and will need to average $4.5 trillion annually after 2026. The changes required are most likely to be implemented in an environment where evidence-based proposals are being put forward by a wide range of stakeholders based on accessible, auditable and replicable data.

To date, access to data and tools to support energy transition planning is highly constrained, where analysis is often done based on closed data and models. There are several reasons for this market failure, including:

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

This situation creates a number of fundamental problems which we believe are stifling the transition to a zero-carbon economy:

These problems make it nearly impossible for all stakeholders to engage in the conversation productively. The result is linear and incremental policy development, particularly in low-income countries, where governments often (i) do not have the resources to afford bespoke consultancy solutions or (ii) rely on supranational RFP mechanisms that often engage the same consultants who produce analysis based on closed data and models.

To solve the aforementioned problems, we plan to build an open-source energy transition data platform without usability compromises and partner with organisations and initiatives that help scale our user growth. In doing so, we believe we can create an energy transition data standard to facilitate the climate flows from high- and low-income countries.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

We will continue utilising OSeMOSYS and PyPSA, which are already among the most widely used opensource energy modelling frameworks. For example, these frameworks have been copied by well-known consultancies and initiatives (e.g., McKinsey, UN PRI), used as a core planning tool for several governments (e.g., Cyprus, Costa Rica, Bolivia), and incorporated into major technical assistance initiatives (e.g., UN DESA and CCG Programme). OSeMOSYS already covers 164 countries[8] separated by 265 nodes[9] .

More specifically, our strategy is to take the most promising open-source frameworks and:

  1. Improve the quality and quantity of their input files - Energy system modelling has historically been a victim of “garbage in and garbage out”, the concept that flawed input data produces flawed outputs. There are many reasons for this, such as the number of assumptions, the confidential nature of energy infrastructure information, and the purpose of least-cost modelling. In short, for intentional and unintentional reasons, the outputs of energy system models are often detached from what happens on the ground. Modern data science and market expertise can help overcome these shortcomings. For example, our Coal Asset Transition (CAT) Tool provides facility-level estimates of productivity, emissions and power purchase agreements from our detection algorithms and incountry expertise. The outcome is more granular and accurate input files and, thus, a more helpful model for market participants.

  2. Reduce usability compromises by modernising the data stack - Our data platform will enable anyone to rapidly and flexibly develop, save and share long-term model runs and scenarios for energy transition decisions relating to the electricity sector. The platform will serve both developers and regular users via an API and UI. The UI will allow for downloads in XLS or CSV formats.

  3. Create a network effect by partnering with users on both sides of the ledger - Once FEO has no usability compromises, we hope to create a network effect through a scalable partnership model. A network effect is where the value of a product or service increases as more users engage with it. Take climate finance as an example. Currently, high-income and low-income countries have no shared understanding of how much and what type of finance is required.

  4. Create a network effect by partnering with users on both sides of the ledger - Once FEO has no usability compromises, we hope to create a network effect through a scalable partnership model. A network effect is where the value of a product or service increases as more users engage with it. Take climate finance as an example. Currently, high-income and low-income countries have no shared understanding of how much and what type of finance is required.

8 Afghanistan, Angola, Albania, United Arab Emirates, Argentina, Armenia, Antarctica, Australia, Austria, Azerbaijan, Burundi, Belgium, Benin, Burkina, Faso, Bangladesh, Bulgaria, Bahrain, Bosnia and Herzegovina, Belarus, Bolivia, Brazil, Brunei Darussalam, Bhutan, Botswana, Central African Republic, Canada, Switzerland, Chile, China, Côte d'Ivoire, Cameroon, Congo, Democratic Republic of the Congo, Colombia, Cabo Verde, Costa Rica, Cuba, Cyprus, Czechia, Germany, Djibouti, Denmark, Dominican Republic, Algeria, Ecuador, Egypt, Eritrea, Western Sahara, Spain, Estonia, Ethiopia, Finland, Fiji, France, Gabon, United Kingdom of Great Britain and Northern Ireland, Georgia, Ghana, Guinea, Gambia, GuineaBissau, Equatorial Guinea, Greece, Guatemala, French Guiana, Guyana, Honduras, Croatia, Hungary, Indonesia, India, Ireland, Iran, Iraq, Iceland, Israel, Italy, Jamaica, Jordan, Japan, Kazakhstan, Kenya, Kyrgyzstan, Cambodia, Korea, Kuwait, Laos, Lebanon, Liberia, Libya, Sri Lanka, Lesotho, Lithuania, Luxembourg, Latvia, Morocco, Moldova, Madagascar, Mexico, North Macedonia, Mali, Myanmar, Montenegro, Mongolia, Mozambique, Mauritania, Mauritius, Malawi, Malaysia, Namibia, Niger, Nigeria, Nicaragua, Netherlands, Norway, Nepal, New Zealand, Oman, Pakistan, Panama, Peru, Philippines, Papua New Guinea, Poland, Korea, Portugal, Paraguay, Qatar, Romania, Russia, Rwanda, Saudi Arabia, Sudan, Senegal, Singapore, Sierra Leone, El Salvador, Serbia, Slovakia, Slovenia, Sweden, Eswatini, Syria, Togo, Thailand, Tajikistan, Turkmenistan, Trinidad and Tobago, Tunisia, Turkey, Taiwan, Tanzania, Uganda, Ukraine, Uruguay, United States of America, Uzbekistan, Venezuela, Vietnam, Yemen, South Africa, Zambia and Zimbabwe.

9 The following countries have more than one node: Australia (8), Brazil (8), Canada (10), China (35), India (6), Japan (7), Russia (8) and United States of America (25)

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Beyond negotiation tactics and political realities, part of the reason why climate finance is so fractious is there is no global data standard - no shared understanding of how much ‘net zero’ policies cost beyond high-level reports based on closed data, which cannot be audited or replicated by all stakeholders in low-income countries. One of the reasons why a global standard for energy transition data has not emerged for low-income countries is due to hoarding behaviour to preserve business models and avoid credibility challenges.

Since FEO is open source, anyone can use the model without restrictions, meaning the more users we can attract from host and donor countries, the more accepted and powerful the data will become. We plan to attract users from low-income and high-income countries to generate a network effect and support the development of a global standard for energy transition planning data. This data standard will allow for consistent measurement, qualification or exchange of data for transition or climate finance. For example, we partner with V20 to produce Climate Prosperity Plans for loan applications and grant applications for climate finance and with the CCG Programme to improve their starter kits to increase international concessional finance.

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

REPORT OF THE DIRECTORS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

TRUSTEES

The trustees during the year were as follows:-

Trustees:

Thomas David Gardner (chair) Paraskevi Bertseka Ho Yan Yulanda Chung Mayumi Omi Geoffrey David Sinclair

Key Management Personnel: Matthew Gray – CEO Lucas Kruitwagen - Head of Technology Appointed 1 September 2022 Sebastian Kennedy - Head of Insights Appointed 1 November 2022 Hristina Petkova - Head of Operations Appointed 1 November 2022 Sriya Sundaresan – Co-CEO (Resigned August 2022)

GOING CONCERN BASIS

The charitable company has cash resources to meet its day to day working capital requirements. Current forecasts indicate that the charitable company expects to be able to operate within these facilities for the foreseeable future. The trustees continue to believe the going concern basis of accounting is appropriate in preparing the annual financial statements.

PROVISION OF INFORMATION TO AUDITORS

Insofar as each of the directors of the charity at the date of approval of this report is aware there is no relevant audit information (information needed by the charity’s auditor in connection with preparing the audit report) of which the charity’s auditor is unaware.

Each director has taken all of the steps that they should have taken as a director in order to make themselves aware of any relevant audit information and to establish that the charity’s auditor is aware of that information.

AUDITORS

The Auditors, Crowe U.K. LLP will be proposed in accordance with section 485 of the Companies Act 2006.

In preparing this report, the directors have taken advantage of the small companies exemptions provided by Section 415A of the Companies Act 2006.

This Annual Report, prepared under the Charities Act 2011 and the Companies Act 2006, was approved by the Trustee Body of TransitionZero onincluding in their capacity as company directors approving the Strategic Report contained therein, and is signed as authorised on its behalf by:

Thomas Gardner Thomas Gardner (Jul 25, 2023 20:48 EDT)

Jul 25, 2023

Thomas David Gardner Director

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TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

STATEMENT OF DIRECTORS’ RESPONSIBILITIES FOR THE YEAR ENDED 31 MARCH 2023

The Trustees (who are also directors of TransitionZero for the purposes of company law) are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards).

Company law requires the Trustees to prepare financial statements for each financial period. Under company law the Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company for that period. In preparing these financial statements, the Trustees are required to:

The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company’s transactions, disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006 and the provisions of the charity’s constitution. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Page 17

Independent Auditor’s Report to the Members and the Trustees of TransitionZero

Opinion

We have audited the financial statements of TransitionZero (‘the charitable company’) for the year ended 31 March 2023 which comprise of a Statement of Financial Activities, Balance Sheet, Statement of Cash Flows and Notes to the Financial Statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 requires us to report to you if, in our opinion:

Page 18

Independent Auditor’s Report to the Members and the Trustees of TransitionZero

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 12, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

We have been appointed as auditors under the Charities Act 2011 and report in accordance with the Acts and relevant regulations made or having effect thereunder.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

We obtained an understanding of the legal and regulatory frameworks within which the charitable company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charitable company’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charitable company for fraud. The laws and regulations we considered in this context for the UK operations were General Data Protection Regulation (GDPR), Health and safety legislation and Employment legislation.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

Page 19

Independent Auditor’s Report to the Members and the Trustees of TransitionZero

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the timing of recognition of income, and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management and the trustees about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission, reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect noncompliance with all laws and regulations.

Use of our report

This report is made solely to the charitable company’s trustees, as a body, in accordance with Part 4 of the Charities (accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charitable company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company’s members as a body and the charitable company’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Alastair Lyon

Alastair Lyon (Aug 2, 2023 09:28 GMT+1)

Alastair Lyon Senior Statutory Auditor For and on behalf of Crowe U.K. LLP Statutory Auditor

Reading

Date: Aug 2, 2023

Page 20

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

STATEMENT OF FINANCIAL ACTIVITIES

(INCORPORATING AN INCOME & EXPENDITURE ACCOUNT) FOR THE YEAR ENDED 31 MARCH 2023

18 month
Unrestricted Restricted Total period to
Funds Funds 2023 31 March
2022
Notes £ £ £ £
Income and endowments from:
Donations and legacies
Donations and legacies - - - 500
Income from charitable activities
Grants receivable 2 1,010,959 942,454 1,953,413 2,457,152
Climate Training - - - 26,735
TOTAL INCOME 1,010,960 942,454 1,953,413 2,484,387
Expenditure on:
Expenditure on charitable
activities
Provision of workshops - - - 26,660
Provision of emissions analysis 1,167,681 757,184 1,924,865 1,616,919
TOTAL EXPENDITURE 4 1,167,681 757,184 1,924,865 1,643,579
Net Income/ (Expenditure) (156,722) 185,270 28,548 840,808
Transfers between funds - - - -
NET MOVEMENT IN FUNDS (156,722) 185,270 28,548 840,808
Funds at 31 March 2022 782,910 57,898 840,808 -
FUNDS AT 31 MARCH 2023 10 626,188 243,168 869,356 840,808

The notes on pages 24 to 34 form part of these financial statements

Page 21

(A COMPANY LIMITED BY GUARANTEE)

TRANSITIONZERO

BALANCE SHEET

31 MARCH 2023

COMPANY NUMBER: 12914740

Notes
FIXED ASSETS
Tangible assets
6

CURRENT ASSETS
Debtors
7
Cash at bank and in hand

CREDITORS:amounts falling due within one year
8

NET CURRENT ASSETS

NET ASSETS

FUNDS
Restricted
9
Unrestricted - General
TOTAL FUNDS
10		 2023
£
12,656
115,120
1,189,227
1,304,347
447,647
856,700
869,356
243,168
626,188
869,356		 2022
£
12,363
138,831
1,061,283
1,200,114
371,669
828,445
840,808
57,898
782,910
840,808

Approved and authorised for issue by the Board of Directors on and signed on its behalf by:-

Thomas Gardner

Thomas Gardner (Jul 25, 2023 20:48 EDT)

Jul 25, 2023

Thomas David Gardner Director

The notes on pages 24 to 34 form part of these financial statements

Page 22

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE) STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2023

Cash generated by operating activities (see below):
Cash flows from investing activities
Purchase of fixed assets
Change in cash and cash equivalents at the end of the year
Reconciliation of net cash flow to movement in net funds/debt
Net funds at 1 April 2022
Increase/ (decrease) in cash in the year
Net funds at 31 March 2023
Analysis of cash and cash equivalents
Cash in hand
Total cash and cash equivalents at end of the year
Reconciliation of cash flows from operating activities
Net movement in funds
Depreciation and amortisation
Decrease/(increase) in debtors
Increase/ (decrease) in creditors
Net cash provided by operating activities		 2023
£
135,394
(7,451)
127,943
1,061,283
127,943
1,189,227
1,189,227
1,189,227
28,548
7,157
23,711
75,978
135,394		 18 month
period to
31 March 2022
£
1,079,471
(18,188)
1,061,283
-
1,061,283
1,061,283
1,061,283
1,061,283
840,808
5,825
(138,831)
371,669
1,079,471

The notes on pages 24 to 34 form part of these financial statement

Page 23

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2023

1. ACCOUNTING POLICIES

a) Charity information

TransitionZero is registered as a company limited by guarantee (without share capital) incorporated in the UK with its registered office at 28 St. John's Square, London, EC1M 4DN. Its principal activity is the promotion of conservation, protection and improvement of the environment, in particular by promoting the reduction of carbon emissions and the improvement of air quality.

b) Basis of preparation

The financial statements have been prepared in accordance with Accounting and Reporting b Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2015) – (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. TransitionZero meets the definition of a public benefit entity under FRS 102.

Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note (s).

c) Going Concern

The charitable company has cash resources to meet its day to day working capital requirements. Current forecasts indicate that the charitable company expects to be able to operate within these facilities for the foreseeable future.

Having regard to the above, the trustees believe it is appropriate to adopt the Going Concern basis of accounting in preparing the financial statements.

d)

Income recognition policies

Income from donations and special efforts are recorded on a receipts basis. Grant income is included when the related condition for legal entitlement to the grant has been met. Contract income is included when the relevant performance conditions within the contract have been met. All other income is recorded on a receivable basis.

e) Funds

General fund:

These are funds which can be used in accordance with the charitable objects at the discretion of the directors.

Restricted fund:

Restricted funds are to be used for specified purposes laid down by the donors. Expenditure for those purposes is charged to the fund. For more detail on these funds please see note 9.

Page 24

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

1. ACCOUNTING POLICIES (CONTINUED)

f) Expenditure

Expenditure is recognised in the Statement of Financial Activities (SOFA) as incurred. Expenditure on charitable activities relates to the provision of emissions analysis data. Support costs are those functions that assist the work of the charity but do not directly undertake charitable activities. Support costs include back office costs, finance, personnel, payroll and governance costs which support the charities’ activities.

g) Depreciation and capitalisation of tangible fixed assets

Fixed assets are depreciated over their expected useful economic lives as follows:-

Computer equipment - 33% straight line

Contributions towards the cost of fixed assets are included as income whilst the gross cost of fixed assets are capitalised. Items under £150 are not capitalised.

h) Debtors

Trade and other debtors are recognised at the settlement amount due. Prepayments are valued at the amount prepaid.

i) Creditors and provisions

Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount.

j)

Legal status

TransitionZero is a company limited by guarantee and has no share capital. In the event of the charity being wound up, the liability in respect of the guarantee is limited to £1 per member of the charity. There were 5 members at the Balance Sheet date (2022: 3 members).

k) Financial instruments

The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value.

Page 25

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

1. ACCOUNTING POLICIES (CONTINUED)

l) Pension costs

The company operates a defined contribution pension scheme. The charge in the SOFA is the amount of contributions payable to the pension scheme in respect of the accounting period.

m) Critical accounting judgements and key sources of estimation uncertainty

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Critical accounting estimates and assumptions:

The charity makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

The Trustees consider that there are no material judgements.

2. GRANTS

ClientEath
European Climate Foundation - Future Energy Outlook
European Climate Foundation - Steel
Tara Climate Foundation
Watttime – Phase 1
Watttime – Phase 2
Watttime – Phase 3
Watttime – Phase 4
Watttime – Phase 5
ClimateWorks
Quadrature Climate Foundation
Centre for Research on Energy and Clean Air RY
Subak		 2023
£
139,917
79,379
101,403
14,965
-
-
-
518,538
88,252
54,134
950,000
2,659
4,166
1,953,413		 18 month
period to
31 March 2022
£
120,000
144,660
-
-
195,450
224,511
159,478
151,156
-
162,402
1,091,667
161,995
45,833
2,457,152

Page 26

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

3. NET INCOME/(EXPENDITURE)

NET INCOME/(EXPENDITURE)
Total Total
18 month
2023 period to 31
March 2022
£ £
Is stated after charging:
Depreciation of tangible assets 7,157 5,825
Audit Fee (excluding VAT) 13,800 12,000
Non-Audit Fee (excluding VAT) 18,236 19,829

4a ) CHARITABLE ACTIVITIES

Staff costs
Depreciation
Other operating expenses
Support costs		 Unrestricted
Funds
£
555,126
7,157
226,080
379,318
1,167,681		 Restricted
Funds
£
347,562
-
370,376
39,246
757,184		 Total
2023
£
902,688
7,157
596,456
418,564
1,924,865		 Total
18 month
period to
31 March 2022
£
1,017,251
5,825
301,800
318,703
1,643,579

4b) OTHER OPERATING EXPENDITURE

Consulting
Project costs
Direct expenses
Staff training		 Total
2023
£
564,508
-
-
31,948
596,456		 Total
18 month
period to
31 March 2022
£
292,500
8,254
258
788
301,800

Page 27

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

4c) SUPPORT COSTS

Advertising & Marketing
Audit & Accountancy fees
Bank Charges
Exchange Gains
Insurance
Miscellaneous
Motor and Travel Expenses
Printing, postage and stationery
Professional Fees
Rent
Software and office expenses
Staff Cost - recruitment
Staff welfare cost
Subscriptions
Repairs and maintenance		 Total
2023
£
4,046
47,310
217
2,683
3,824
42,332
26,813
65
31,068
171,056
13,245
21,575
15,091
39,239
-
418,564		 Total
18 month
period to
31 March 2022
£
49,920
36,389
467
737
4,676
19,942
2,922
472
68,652
44,791
2,749
39,831
-
46,727
428
318,703

Page 28

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

5. STAFF COSTS

Wages and salaries
Social security costs
Pension costs
The average number of employees during the period:		 2023
£
794,450
94,586
13,652
902,688
2023
No.
12		 18 month
period to
31 March
2022
£
899,775
104,786
12,690
1,017,251
18 month
period to
31 March 2022
No.
8

During the year none of the Trustees received any remuneration. During the year one trustee received reimbursement of expenses totalling £6,005 (18 month period to 31 March 2022: £NIL) and no expenses were waived in the year by the trustees and senior management (2022: None)

The number of employees earning over £60,000 during the year was as follows :-

18 month
period to 31
2023 March 2022
No. No.
60,001 – 70,000 3 2
70,001 – 80,000 1 1
80,001 – 90,000 - 1
180,001– 190,000 1 2

The trustees consider the board of trustees, the CEO and Department Heads as comprising the key management personnel of the charity. The total number of benefits of the key management personnel of the charity in the year were £410,589 (18 month period to 31 March 2022: £432,605).

Page 29

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

FOR THE YEAR ENDED 31 MARCH 2023

6. TANGIBLE FIXED ASSETS

COST:
At 1 April 2022
Additions
Disposals
At 31 March 2023
DEPRECIATION:
At 1 April 2022
Charge for the year
Disposals
At 31 March 2023
NET BOOK VALUES:
At 31 March 2023
At 1 April 2022		 Computer
Equipment
£
18,188
7,450
-
25,638
5,825
7,157
-
12,982
12,656
12,363

All fixed assets are employed directly in furtherance of the charity’s objects, or in support thereof.

7. DEBTORS

DEBTORS
Other debtors
Prepayments and accrued income		 2023
£
67,577
47,543
115,120		 18 month
period to
31 March 2022
£
32,873
105,958
138,831

Page 30

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

8. CREDITORS: Amounts falling due within one year

Trade creditors
Other taxes and social security
Other creditors
Accruals and deferred income		 2023
£
47,862
-
-
399,785
447,647		 18 month
period to
31 March 2022
£
1,148
42,129
1,886
326,506
371,669

9. RESTRICTED FUNDS

2023

Watttime phases 1 - 3
Watttime phase 4
Watttime phase 5
Client Earth
Client Earth
Centre for Research on Energy
and Clean Air – China project
European Climate Foundation
FEO
European Climate Foundation
Steel
ECF Workshop
TARA		 31 March
2022
£
1,208
19,368
-
(301)
-
3,243
34,304
-
76
-
57,898		 Income
£
-
518,538
88,252
-
139,917
-
79,379
101,403
-
14,965
942,454		 Expenditure
£
-
(388,303)
(30,623)
-
(140,103)
-
(113,176)
(75,844)
-
(9,135)
(757,184)		 31 March
2023
£
1,208
149,603
57,629
(301)
(186)
3,243
507
25,559
76
5,830
243,168

WattTime Phase 4 – 5 – Climate TRACE is a project founded by a global coalition of nonprofits, tech companies, and universities created to make meaningful climate action faster and easier by independently tracking greenhouse gas (GHG) emissions with unprecedented detail and speed. Climate TRACE harnesses satellite imagery and other forms of remote sensing, artificial intelligence, and data science expertise to identify human-caused GHG emissions when and where they happen. The sub-grant is e for the purposes of supporting the completion of Phase 5 deliverables for Climate TRACE; TransitionZero is providing emissions for power generation and selected heavy industry subsectors and will support the ClimateTRACE deliverables as follows

Page 31

(A COMPANY LIMITED BY GUARANTEE)

TRANSITIONZERO

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

Client Earth - restricted funding to deliver original asset level economic analysis against ClientEarth targets in Asia, including in Japan and Indonesia.

European Climate Foundation FEO - restricted funding for Future Energy Outlook (FEO) platform which supports energy transition campaigning and decision making in different geographies by developing a credible and transparent alternative to incumbent energy models providers.

European Climate Foundation Steel – restricted funding focusing on the Heavy Industry sector, specifically on Steel. The funding is intended for the development of a database to asset owners and investment banks to start meaningfully pricing physical, legal, and transition risk, as well as supporting the evidence base to finance the process retrofits needed to ensure the steel sector is aligned with the temperature goal in the Paris Agreement.

TARA - restricted funding to deliver economic analysis focusing on the South East Asia region.

10. ANALYSIS OF NET ASSETS

Fund balances at 31 March 2023 are represented by:-

Tangible fixed assets
Current assets
Current liabilities		 Unrestricted
General
Funds
£
12,656
1,061,179
(447,647)
626,188		 Restricted
Funds
£
-
243,168
-
243,168		 Total
Funds
£
12,656
1,304,347
(447,647)
869,356

Fund balances at 31 March 2022 are represented by:-

Tangible fixed assets
Current assets
Current liabilities		 Unrestricted
General
Funds
£
12,363
1,142,216
(371,669)
782,910		 Restricted
Funds
£
-
57,898
-
57,898		 Total
Funds
£
12,363
1,200,114
(371,669)
840,808

Page 32

TRANSITIONZERO

(A COMPANY LIMITED BY GUARANTEE)

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

11. PENSION COSTS

The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the charity in a separately administered fund. The pension cost represents contributions payable by the charity to the fund and amounted to £13,652 (18 month period to 31 March 2022 £12,690). There was no outstanding balance at the period end (2022: £1,886).

12. FINANCIAL INSTRUMENTS

FINANCIAL INSTRUMENTS
2023 2022
£ £
Basic financial assets measured at amortised cost 1,294,298 1,099,715
Basic financial liabilities measured at amortised cost 64,092 20,634

Basic financial assets measured at amortised cost are all cash in hand and debtors minus prepayments and VAT debtor.

Basic financial liabilities measured at amortised cost are all creditors minus other taxes and social security and deferred income.

The entity’s income, expense, gains and losses in respect of financial instruments are summarized below:

2023 2022
£ £
Total interest income for basic financial assets - -

13. RELATED PARTY TRANSACTIONS

There were no related party transactions in the period (2022: None).

Page 33

(A COMPANY LIMITED BY GUARANTEE)

TRANSITIONZERO

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) FOR THE YEAR ENDED 31 MARCH 2023

14. COMPARATIVE STATEMENT OF FINANCIAL ACTIVITY FOR THE 18 MONTH PERIOD TO MARCH 2022

Note
Income and endowments from:
Donations and legacies
Donations and legacies
Income from charitable activities
Grants receivable
3
Climate training
2
TOTAL INCOME
Expenditure on:
Expenditure on charitable
activities
Provision of workshops
Provision of emissions analysis
TOTAL EXPENDITURE
5
Net income/ (expenditure)
4
Transfers between funds
NET MOVEMENT IN FUNDS
Funds at 30 September 2020
FUNDS AT 31 MARCH 2022
11		 Unrestricted
Funds
£
500
1,386,271
-
1,386,771
-
603,861
603,861
782,910
-
782,910
-
782,910		 Restricted
Funds
£
-
1,070,881
26,735
1,097,616
26,660
1,013,058
1,039,718
57,898
-
57,898
-
57,898		 Total
2022
£
500
2,457,152
26,735
2,484,387
26,660
1,616,919
1,643,579
840,808
-
840,808
-
840,808

Page 34

Audited Financial Statements and Trustee

Report

Final Audit Report 2023-08-02 Created: 2023-07-25 By: Hristina Petkova (hristina@transitionzero.org) Status: Signed Transaction ID: CBJCHBCAABAACFgDwRosmLbYAwSpL3rKPmF1p9h2WW2L

"Audited Financial Statements and Trustee Report" History

Document created by Hristina Petkova (hristina@transitionzero.org) 2023-07-25 - 12:38:33 PM GMT

Document emailed to Thomas Gardner (tgards79@gmail.com) for signature 2023-07-25 - 12:42:24 PM GMT

Email viewed by Thomas Gardner (tgards79@gmail.com) 2023-07-26 - 0:48:25 AM GMT

Document e-signed by Thomas Gardner (tgards79@gmail.com) Signature Date: 2023-07-26 - 0:48:44 AM GMT - Time Source: server

Document emailed to Alastair Lyon (alastair.lyon@crowe.co.uk) for signature 2023-07-26 - 0:48:45 AM GMT

Email viewed by Alastair Lyon (alastair.lyon@crowe.co.uk) 2023-08-02 - 8:28:13 AM GMT

Document e-signed by Alastair Lyon (alastair.lyon@crowe.co.uk) Signature Date: 2023-08-02 - 8:28:58 AM GMT - Time Source: server

Agreement completed. 2023-08-02 - 8:28:58 AM GMT