CU : Annual Reporting Document

SUSTAINABILITY REPORT 2021

TABLE OF CONTENTS

Message from the Chair and CEO 2

Integrated Solutions 4

Current Operations and Investments 5

Our Approach to Sustainability 6

Strategic 2030 ESG Targets 8

Roadmap to Net-Zero 9

Energy Transition 10

FORWARD-LOOKING INFORMATION

Climate Change &

Environmental Stewardship 16

Operational Reliability & Resilience 21

People 27

Community & Indigenous Relations 32

Governance 37

ESG Datasheet 40

We have a long and successful history of building effective partnerships with Indigenous communities across Canada. The NorthwesTel project-operated by our 50/50 joint venture with the Northern Aboriginal Services Company (NASCo)-serves 157 NorthwesTel microwave sites across 96 different communities in the Northwest Territories, Yukon, Nunavut and northern British Columbia.

Certain statements contained in this document constitute forward-looking information. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "plan", "estimate", "expect", "may", "will", "intend", "should", "goals", "targets", "strategy", "future", and similar expressions. In particular, forward-looking information in this document includes, but is not limited to: references to general strategic plans, goals and targets, including targeted net zero emissions by 2050; the 2030 ESG targets outlined on pages 8 and 9; expectations and projections regarding planned hydrogen, solar, pumped hydro, RNG or energy efficiency projects, including the timing, productive capacity, emissions reductions and other project benefits related to such projects; projected capabilities of technology under development; and electricity to be generated from planned solar projects and related emissions reductions from such projects.

Although we believe that the expectations reflected in the forward-looking information are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and no assurance can be given that these expectations will prove to be correct. Forward-looking information should not be unduly relied upon. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties, and other factors, which may cause actual results, levels of activity and achievements to differ materially from those anticipated in such forward-looking information. The forward-looking information reflects our beliefs and assumptions with respect to, among other things, our ability to successfully achieve our net zero GHG target by 2050; our ability to achieve our 2030 ESG goals; the development and performance of technology and technological innovations and the ability to otherwise access and implement all technology necessary to achieve GHG and other ESG targets; continuing collaboration with certain regulatory and environmental groups; the performance of assets and equipment; demand levels for oil, natural gas, gasoline, diesel and other energy sources; certain levels of future energy use; future production rates; future revenue and earnings; the ability to meet current project schedules, and other assumptions inherent in our expectations in respect of the forward-looking information identified herein.

Actual results could differ materially from those anticipated in this forward-looking information as a result of, among other things, risks inherent in the performance of assets; capital efficiencies and cost savings; applicable laws and government policies; regulatory decisions; competitive factors in the industries in which we operate; prevailing economic conditions (including as may be affected by the COVID-19 pandemic); credit risk; interest rate fluctuations; the availability and cost of labour, materials, services, and infrastructure; the development and execution of projects; prices of electricity, natural gas, natural gas liquids, and renewable energy; the development and performance of technology and new energy efficient products, services, and programs including but not limited to the use of zero-emission and renewable fuels, carbon capture, and storage, electrification of equipment powered by zero-emission energy sources and utilization and availability of carbon offsets; the occurrence of unexpected events such as fires, severe weather conditions, explosions, blow-outs, equipment failures, transportation incidents, and other accidents or similar events; and other risk factors, many of which are beyond our control. Due to the interdependencies and correlation of these factors, the impact of any one material assumption or risk on a forward-looking statement cannot be determined with certainty. Readers are cautioned that the foregoing lists are not exhaustive. For additional information about the principal risks that the Company faces, see "Business Risks and Risk Management" in our Management's Discussion and Analysis for the year ended December 31, 2021. Any forward-looking information contained in this document represents our expectations as of the date hereof, and is subject to change after such date. We disclaim any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required by applicable securities legislation.

MESSAGE FROM THE CHAIR AND CEO

For 75 years, we have taken a holistic approach to growth-recognizing that to create intergenerational prosperity, we must also create sustainable value for all constituents. Long before the convergence of today's environmental, social and governance (ESG) priorities, the founders and early leaders of our enterprise employed pre-emptive "before-the-fact" strategies to identify and solve complex economic, environmental, and social challenges.

From the very genesis of our group of companies-humble beginnings in a small family bungalow, from which my grandfather and father grew a lile trailer rental business into an entirely new global industry-the people of ATCO have taken a purpose-driven approach to commerce. Today, though we are diverse in our holdings, we are integrated in our focus on sustainability and steadfast in our underlying core values: integrity, caring, agility, safety and collaboration.

This is, and always has been, ATCO's winning formula.

At the sta of 2022, we expanded upon our deeply integrated commitment to sustainability with the announcement of a comprehensive set of 2030 ESG targets and a commitment to net-zero by 2050. These targets represent the full breadth of our diverse global operations, which are positioned at the forefront of sectors vital to healthy and growing economies. They also reflect a broad spectrum of ESG topics, including the energy transition, advancing Indigenous reconciliation, and promoting diversity, equity, and inclusion.

Though our targets were only recently unveiled, as you will read in this repo, our achievements from the past year are interspersed with tangible examples of early progress.

With operations across the energy value chain, ATCO is at the forefront in driving the energy transition towards cleaner fuels and electricity. Throughout our group of companies, we are pioneering innovative solutions that enable our customers to achieve their emissions goals without sacrificing the safety, reliability, and affordability of energy. Achieving net-zero by 2050 is a societal challenge that no individual, business, or government can solve on its own. It will require unprecedented collaboration among all constituents, as well as an informed, pragmatic, and affordable roadmap from policymakers to unlock the necessary scale and pace of private sector investment and expeise.

Within that context, there are few greater oppounities for global constituents than hydrogen. That is why we continue to collaborate with our paners and invest in cleaner fuels, including with Suncor on a potential world-scale clean hydrogen project in Albea, blending hydrogen into a poion of the natural gas transmission system in Fo Saskatchewan, Albea, and generating renewable hydrogen through solar-powered electrolysis in Western Australia. Growing the global clean hydrogen economy is one oppounity to accelerate the transition to net-zero.

We also continue to grow our renewable energy footprint, with plans underway to repurpose two industrial sites in the hea of Calgary to generate enough electricity to power 18,000 homes every year. This is in addition to the acquisition of another 39-megawa solar facility, under development in eastern Albea.

"This is an incredibly exciting time for ATCO, as we knit together our deep appreciation of our roots with our optimism and drive for a future that looks very different from where we are today. From where I stand, the horizon has never looked brighter for ATCO as we pursue and continue to develop inspired solutions for a more sustainable world."

Meanwhile, ATCO Frontec is forging innovative Indigenous panerships that serve as models for Canada on how to accelerate Indigenous economic reconciliation. In early 2022, aſter

• a rigorous competitive process, the Government of Canada awarded Nasiuq Corporation,

• a panership between Frontec and the Pan Arctic Inuit Logistics Corporation (PAIL),

• a seven-year contract to operate and maintain the Noh Warning System-a 5,000 km "tripwire" of radar sites throughout the Arctic. The roots of our panership with PAIL extend back decades and today, as a majority Inuit-owned corporation, Nasiuq will deliver long-lasting benefits to Inuit beneficiaries, including earnings, employment, sub-contracting oppounities, and training.

Our achievements from the past year are due in no small pa to the extraordinary people of ATCO and the diverse perspectives, backgrounds, and expeise they bring to our company. Recognizing that diversity, equity and inclusion (DEI) is a journey, not a destination, we have created an enterprise-wide DEI council, to complement our many existing grassroots commiees and initiatives. The council's goal will be to focus on concrete action to overcome systemic inequality and play a key role in our ongoing effos to be a leader in DEI and aract and retain the best and brightest in our workforce.

In sum, as has been our course for 75 years, sustainability is more than an aspiration: it is interwoven into our vision, values, strategy, and day-to-day operations. It manifests in the everyday decisions of our exemplary team of 6,400 people around the world-and I would like to thank each of them for their unwavering commitment.

This is an incredibly exciting time for ATCO, as we knit together our deep appreciation of our roots with our optimism and drive for a future that looks very different from where we are today. From where I stand, the horizon has never looked brighter for ATCO as we pursue and continue to develop inspired solutions for a more sustainable world.

Sincerely yours,

Nancy Southern

Chair & Chief Executive Officer

From reliable, sustainable energy for homes and businesses to innovative temporary and permanent structures and everything in between, we build communities, energize industries and deliver customer-focused infrastructure solutions. Sustainability disclosures reflect our business operations including:

INTEGRATED SOLUTIONS

Delivering inspired solutions for a beer world

ENERGY

• • Electricity Transmission

• • Electricity Distribution

• • Electricity Generation

• • Natural Gas Distribution

• • Natural Gas Transmission

• • Hydrogen Production

• • Energy Storage

• • Industrial Water

• • Retail Electricity and Natural Gas (Home and Business)

STRUCTURES & LOGISTICS

• • Relocatable Space Rentals

• • Permanent Modular Construction

• • Workforce Accommodations

• • Disaster and Emergency Management

• • Operations and Maintenance

• • Lodging Services

• • Site Services