PG&E Corporate Responsibility and Sustainability Report 2017

Climate Change

Taking action to combat climate change is integral to PG&E’s mission to provide safe, reliable, affordable and clean energy to customers. We remain focused on reducing our carbon footprint, helping our customers do the same and leading the transition to a low-carbon economy. Our efforts extend to adapting our operations and infrastructure to changing climate conditions, as well as supporting efforts at the local level to make the communities we serve more resilient.

Our Approach

Our commitment begins locally but extends to state and international levels. PG&E leaders joined California’s delegation at the 2015 COP21 international climate talks in Paris, where we voiced our support for an agreement to slow global warming, and in 2016 we participated in the seventh Clean Energy Ministerial, which brought the energy ministers from 25 nations around the world together with business leaders, entrepreneurs, industry experts and others to help nations deliver on the pledges made in Paris.

In addition, after being selected as PG&E Corporation CEO and President, Geisha Williams issued a message to customers expressing PG&E’s commitment to reaching California’s clean energy goals, and our conviction that climate change is real and action must be taken.

At the state level, PG&E supported Senate Bill (SB) 350, which increases the state’s Renewables Portfolio Standard (RPS) to 50 percent by 2030 and doubles state energy efficiency goals. PG&E views SB 350 as an important step toward achieving California’s climate change and clean energy goals. It continues our state’s long history of policy leadership, which has spurred advancements in technology and innovation, and kept California at the forefront of environmental progress.

Additionally, SB 32 requires that the California Air Resources Board (ARB) ensure a 40 percent reduction in greenhouse gases by 2030 compared to 1990 levels. PG&E supported the state’s successful effort to approve a comprehensive bill package that extends California’s cap-and-trade program through 2030 and PG&E remains actively engaged with policymakers and various stakeholders on SB 32 implementation.

To do our part, we are taking an integrated approach to reduce GHG emissions in a way that manages costs for customers, delivers safe and reliable electric and gas service, and creates a model for others to follow.

Reporting Our Impacts

We believe it is essential that investors, customers, policymakers and other stakeholders have access to information that allows them to assess and understand a company’s risks and opportunities associated with climate change.

PG&E reports its greenhouse gas emissions to the California Air Resources Board and the U.S. Environmental Protection Agency (EPA) on a mandatory basis. On a voluntary basis, PG&E reports a more comprehensive emissions inventory to The Climate Registry, a nonprofit organization. Each year, PG&E also reports its greenhouse gas emissions and climate change strategies to the CDP (PDF), an international not-for-profit organization that requests information on behalf of institutional investors.

Engaging Our Customers

PG&E actively works with customers to help them achieve energy savings and greenhouse gas emission reductions through some of the nation’s leading programs and incentives for energy efficiency, demand response and solar installation. These efforts include helping local governments develop strategies and implementation plans to save energy and reduce emissions, and connecting them with PG&E programs and other resources to help them meet their energy goals.

Addressing Our Own Carbon Footprint

PG&E believes that gas and electric providers have a responsibility to reduce greenhouse gas emissions.

In step with California’s evolving energy policy, in June 2016 PG&E announced a Joint Proposal with labor and leading environmental organizations that would increase investment in energy efficiency, renewables and storage beyond current state mandates while phasing out PG&E’s production of nuclear power in California by 2025. It includes PG&E’s commitment to a 55 percent renewable energy target in 2031, an unprecedented voluntary commitment by a major U.S. energy company.

We are committed to helping the state meet the long-term targets established by SB 32, which codified Governor Brown’s May 2015 Executive Order and calls for a 40 percent reduction in California’s greenhouse gases by 2030 compared to 1990 levels.

In the near term, California’s Global Warming Solutions Act, or Assembly Bill (AB) 32, requires California to gradually reduce its greenhouse gas emissions to the 1990 level of 431 million metric tons of carbon dioxide-equivalent (CO2-e) by 2020. The law covers emissions from PG&E’s fossil-fuel power plants, natural gas compressor stations and electricity imported into California. In 2015, the law was expanded to cover emissions from the combustion of natural gas delivered to customers.

We are actively working to reduce our carbon footprint by increasing our supply of clean and renewable energy, reducing energy use in our facilities, avoiding emissions in our operations, investing in lower-emission vehicles and building a more sustainable supply chain.

Clean Energy Policy

PG&E supports the decarbonization of California’s economy through timely, durable, environmentally-effective and least-cost policy and energy solutions and remains committed to climate actions to reduce greenhouse gases and address the impacts of global warming—from deploying clean energy technologies to continuing to lead and innovate on energy efficiency.

As required by SB 32, ARB is finalizing a second update to its 2008 Scoping Plan, which will establish a framework of action to meet the state’s 2030 target. We are actively engaged in state regulatory and legislative climate change activities, including those around implementing California’s cap-and-trade program, in order to meet the state’s greenhouse gas emissions reduction goals at the lowest possible cost to customers.

We also remain focused on other Scoping Plan measures such as Low Carbon Fuel Standard implementation and the reduction of Short-Lived Climate Pollutants per SB 1383, which includes specific 2030 emission reduction goals for methane, fluorinated gases and anthropogenic black carbon.

At the federal level, the EPA is charged with implementation and enforcement of the Clean Air Act. In August 2015, EPA released the final Clean Power Plan, which includes guidelines for each state to develop plans to achieve greenhouse gas reduction targets under section 111(d) of the Clean Air Act. Following publication of EPA’s regulations, a number of parties challenged EPA’s section 111(d) regulations in the United States Court of Appeals for the District of Columbia Circuit and petitioned the Court to stay the regulations pending review of the appeal on the merits. The D.C. Circuit denied the request for a stay, but in February 2016, the U.S. Supreme Court granted a stay, pending review of the appeal by the D.C. Circuit. The Supreme Court’s decision may affect the nature, extent and timing of implementation of these regulations.

In March 2017, the Trump Administration issued an Executive Order directing EPA to undertake a review to suspend, revise or rescind the final regulations. There is significant uncertainty with regard to what further actions may occur regarding climate change at the federal level.

Central to our overall approach is engaging at the state, federal and international levels through a variety of policy think tanks and advocacy groups, such as the Center for a New Energy Economy, Georgetown Climate Center, Center for Climate and Energy Solutions, Alliance to Save Energy, Edison Electric Institute, Bipartisan Policy Center, Electric Power Research Institute, International Emissions Trading Association, Business Council for Sustainable Energy, Natural Gas Downstream Initiative, the Electric Drive Transportation Association, and the California Electric Transportation Coalition.

Planning for Potential Climate Change Impacts

As a provider of critical infrastructure services, PG&E faces a variety of risks from a changing climate, including heat waves, more frequent and extreme storms, wildfires and rising sea levels. Building greater climate resilience involves understanding the impacts of climate change on our business and being prepared to withstand and rapidly recover from major disruptions to service that are driven by changing climate conditions and weather events.

PG&E has established an internal Climate Resilience Officer Committee to coordinate work across enterprise risk management; internal culture, integration and planning; and external engagement. Using climate science as a foundation, the Committee is overseeing a multi-year research plan to close gaps in our approach to addressing the impacts of climate change.

Key aspects to PG&E’s approach include:

  • Near-term planning: Robust emergency response plans and procedures to address near-term risks, including more extreme storms, heat and wildfires.
  • Risk assessment and operational planning: A multi-year, comprehensive risk assessment process to prioritize infrastructure investments for longer term risks, such as sea level rise.
  • External engagement: Active engagement at the federal, state and local level on climate change adaptation and resilience.

We also continue to make substantial investments to build a more modern and resilient gas and electric system that can better withstand extreme weather and natural disasters. PG&E’s progress and perspective can be found in our Climate Change Vulnerability Assessment and Resilient Strategies report.

After the torrential rains of early 2017, much of California is no longer experiencing drought conditions. However, PG&E continues to treat water as a precious resource in our operations and our facilities, while working with customers to help them do so as well. Given the strong nexus between water and energy—about 20 percent of California’s electricity usage goes toward moving, treating, disposing of, heating and consuming water—responsible water management will continue to be a priority for PG&E.

With regard to increased electricity demand from more extreme, persistent and frequent hot weather, PG&E believes its strategies to reduce greenhouse gas emissions—such as energy efficiency and demand response programs, infrastructure improvements and the support of renewable energy development and storage—will help address the state’s evolving energy demands.

We also continue to engage with key stakeholder groups on climate adaptation, including numerous cities and counties, the Bay Area Council, the Resilient by Design Bay Area Challenge, the U.S. Department of Energy’s Partnership for Energy Sector Climate Resilience and a variety of other forums at the state and local level.

2016 Milestones

In 2016, we continued to minimize our carbon footprint:

  • Delivered clean energy to customers. Nearly 70 percent of the electricity PG&E delivered to customers in 2016 came from greenhouse gas-free resources—a mix of renewable, large hydro and nuclear sources of energy.
  • Reduced facility energy use. We reduced energy use in our facilities by 1.2 percent—aided in part by employee participation in PG&E’s Step Up and Power Down initiative, a behavior-driven energy savings campaign.
  • Reduced methane emissions. We avoided the release of more than 99,000 metric tons of CO2-e emissions. These savings were achieved primarily through upgrades to gas pipelines and other infrastructure and implementing a technique called cross-compression, where natural gas is transferred from one pipeline to another during pipeline construction and repair projects rather than releasing it into the atmosphere.
  • Continued to green our fleet. Through the deployment of alternative fuel vehicles, we reduced greenhouse gas emissions by more than 10,000 metric tons. We added new plug-in electric vehicles to our fleet, including becoming the first electric and gas provider in the nation to deploy Class 3, Class 5 and Class 6 export-power-capable plug-in electric hybrid bucket trucks and work trucks. Exportable power allows a truck to power buildings or homes in a neighborhood during planned or unplanned outages.
  • Reduced our sulfur hexafluoride (SF6) emissions. We reduced our SF6 emissions by more than 1,600 metric tons of CO2-e and achieved an SF6 emission rate of 1.03 percent, nearly achieving the state’s 1 percent target for 2020. SF6 is used as an electrical insulating material in high-voltage circuit breakers and gas-insulated switchgear.

Measuring Progress

Mandatory Emissions Reporting

Under AB 32’s annual reporting requirements, PG&E reports greenhouse gas emissions to the ARB. These reports include emissions from our electric generation facilities, natural gas compressor stations, natural gas supplied to customers and the fugitive emissions from our natural gas distribution system and compressor stations.

The following table shows the greenhouse gas emissions data PG&E reported to ARB under AB 32.

PG&E Emissions Reported to the California Air Resources Board: CO2 Emissions from Owned Power Generation Footnote 1 and Operations
2014 2015 2016
Total CO2 Emissions (metric tons) 2,405,407 2,872,416 2,258,822
Humboldt Bay Generating Station 162,385 186,144 171,721
Gateway Generating Station 1,276,932 1,304,656 962,413
Colusa Generating Station 966,090 1,381,616 1,124,688
 
CO2 Emissions Rates (lbs/MWh)
Humboldt Bay Generating Station 1,023 1,010 1,029
Gateway Generating Station 868 868 871
Colusa Generating Station 857 853 852
Fossil Plants 873 868 872
All Plants Footnote 2 184 208 153
 
Other CO2-e Emissions (metric tons)
Natural Gas Compressor Stations Footnote 3 348,155 362,472 295,718
Distribution Fugitive Natural Gas Emissions 750,223 676,458 605,690
Customer Natural Gas Use Footnote 4 41,616,935 43,022,557 38,697,656
  • 1. PG&E’s utility-owned generation comprised about 50 percent of our delivered electricity in 2016. PG&E also reported N2O and CH4 emissions from each of our generating stations.
  • 2. Includes all PG&E-owned generation sources, including nuclear, hydroelectric and renewable energy.
  • 3. Includes, but not limited to, compressor stations and storage facilities emitting more than 25,000 metric tons of CO2-e annually.
  • 4. Includes emissions from the combustion of natural gas delivered to all entities on PG&E’s distribution system, with the exception of gas delivered to other natural gas local distribution companies. This figure does not represent PG&E’s compliance obligation under AB 32, which is equivalent to the above reported value less the fuel that is delivered to covered entities, as calculated by ARB.

PG&E also reports the greenhouse gas emissions from our facilities and operations to EPA under EPA’s mandatory reporting requirements.

Voluntary Emissions Reporting

Benchmarking Greenhouse Gas Emissions for Delivered Electricity
(Pounds of CO2 per MWh)
U.S. Average Footnote 1 1,143
Pacific Gas and Electric Company Footnote 2
2015 405
2014 435
2013 427
2012 445
2011 393
2010 445
2009 575
  • 1. U.S. Environmental Protection Agency eGRID.
  • 2. Because PG&E purchases a portion of its electricity from the wholesale market, we are not able to track some of our delivered electricity back to a specific generator. Therefore, there is some unavoidable uncertainty in PG&E’s total emissions and emissions rate for delivered electricity.

PG&E’s voluntary greenhouse gas emissions reporting showed that PG&E’s CO2 emissions rate was approximately one-third of the national average for gas and electric providers in 2015, the most recent year for which verified data are available. PG&E’s emissions rate of 405 pounds of CO2 per megawatt-hour of delivered electricity takes into account both PG&E-owned power generation and power purchased from third parties.

In addition, PG&E saw a corresponding reduction in total carbon dioxide emissions from its electricity sales, falling 1.1 million metric tons in 2015.

From year to year, several factors affect PG&E’s power mix and emissions, including the availability of clean hydro power, renewable energy added to our energy mix and the availability and flexibility of the power plants in our portfolio.

Total Greenhouse Gas Emissions by Source Category
(Million Metric Tonnes CO2-e) Footnote 1
2013 2014 2015
Total 57.61 55.69 54.39
Delivered Electricity Footnote 2 15.81 15.91 14.81
Electricity Transmission and Distribution Line Losses 1.15 1.24 0.95
Customer Natural Gas Use 39.20 36.89 36.57
Process and Fugitive Emissions from Natural Gas Systems 0.87 1.10 1.50 Footnote 3
Gas Compressor Stations 0.33 0.35 0.34
Transportation 0.10 0.10 0.11
Facility Gas and Electricity Use 0.06 0.01 0.05
Sulfur Hexaflouride (SF6) from Electrical Equipment 0.07 0.02 0.05
Other Emissions 0.01 0.01 0.01
  • 1. The protocols for measuring greenhouse gas emissions differ between mandatory and voluntary reporting regimes, resulting in some differences in the table above compared to PG&E’s emissions reported to the California Air Resources Board.
  • 2. Because PG&E purchases a portion of its electricity from the wholesale market, we are not able to track some of our delivered electricity back to a specific generator. Therefore, there is some unavoidable uncertainty in PG&E’s total emissions and emissions rate for delivered electricity.
  • 3. The increase in PG&E’s overall emissions reported in 2015 can be attributed to changes in emissions factors used for deriving emissions and new, more granular data requirements.

In 2015, PG&E’s reported combined Scope 1 and 2 greenhouse gas emissions rose slightly, largely due to increased output from our owned natural gas power plants and an updated reporting methodology for natural gas process and fugitive emissions. PG&E’s Scope 3 emissions were lower as a result of less reliance on power generated by third-parties.

PG&E’s Scope 1, 2 and 3 Greenhouse Gas Emissions
(Million Metric Tons CO2-e) Footnote 1
2013 2014 2015
Subtotal 57.61 55.69 54.39
Scope 1 3.77 4.00 4.90
Scope 2 1.20 1.29 1.00
Scope 3 Footnote 2, Footnote 3 52.63 50.40 48.50
  • 1. Because PG&E purchases a portion of its electricity from the wholesale market, we are not able to track some of our delivered electricity back to a specific generator. Therefore, there is some unavoidable uncertainty in PG&E’s total emissions and emissions rate for delivered electricity.
  • 2. The emissions associated with purchased electricity are considered Scope 3 per The Climate Registry’s Electric Power Sector Protocol for the Voluntary Reporting Program, Annex I to the General Reporting Protocol, June 2009, Version 1.0.
  • 3. This figure includes the emissions from the combustion of natural gas delivered to all entities on PG&E’s distribution system, with the exception of gas delivered to other natural gas local distribution companies, as well as gas delivered to PG&E facilities such as power plants, compressor stations and offices, the emissions of which are reported separately.
PG&E’s Scope 1 Greenhouse Gas Emissions
(Million Metric Tons CO2-e)
2013 2014 2015
Total Scope 1 Greenhouse Gas Emissions 3.77 4.00 4.90
SF6 from Electrical Equipment 0.07 0.02 0.05
Facility Natural Gas Use 0.01 0.06 0.01
Gas Compressor Stations 0.33 0.35 0.34
Owned Fossil Generation 2.39 2.42 2.88
Process and Fugitive Emissions from Natural Gas System 0.87 1.10 1.50 Footnote 1
Transportation 0.10 0.10 0.11
  • 1. The increase in PG&E’s overall reported emissions in 2015 can be attributed to changes in emissions factors used for deriving emissions, and new, more granular data requirements.
PG&E’s Scope 2 Greenhouse Gas Emissions
(Million Metric Tons CO2-e)
2013 2014 2015
Total Scope 2 Greenhouse Gas Emissions 1.20 1.29 1.00
Electricity Transmission and Distribution Line Losses 1.15 1.24 0.95
Facility Electricity Use 0.06 0.05 0.05
PG&E’s Scope 3 Greenhouse Gas Emissions
(Million Metric Tons CO2)
2013 2014 2015
Total Scope 3 Greenhouse Gas Emissions 52.63 50.40 48.50
Purchased Electricity (Net) 13.42 13.49 11.93
Customer Natural Gas Use Footnote 1 39.20 36.89 36.57
Other Scope 3 emissions Footnote 2 0.01 0.01 0.01
  • 1. This figure includes the emissions from the combustion of natural gas delivered to all entities on PG&E’s distribution system, with the exception of gas delivered to other natural gas local distribution companies, as well as gas delivered to PG&E facilities such as power plants, compressor stations and offices, the emissions of which are reported separately.
  • 2. Other Scope 3 emissions include the greenhouse gas emissions from business air travel, waste management and employee commuting.

Looking Ahead

As we work toward a low-carbon future, PG&E remains on track to meet California’s clean energy goals through renewables, energy efficiency and infrastructure investment, as well as support for distributed private resources, alternative-fueled vehicles and battery storage.

We will continue to do our part to further reduce greenhouse gas emission levels in the energy sector. This includes our active engagement on state and local policy and our continued focus on providing some of the nation’s cleanest energy to our customers.