PG&E Corporate Responsibility and Sustainability Report 2018

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Compliance

PG&E’s commitment to environmental leadership is reflected in our environmental policy (PDF), which requires strict adherence to all applicable environmental laws and regulations. But we also seek to go beyond compliance—setting ambitious objectives and high standards that exceed the legal and regulatory baselines.

Our Approach

Environmental Management System

PG&E’s operations are subject to extensive federal, state and local environmental laws and regulations. These requirements relate to a broad range of activities, including preventing the discharge of pollutants; safely transporting, handling and storing hazardous materials; properly managing hazardous wastes; protecting threatened and endangered species; and reporting and reducing emissions of air pollutants (such as nitrogen oxides and particulates) and greenhouse gases (GHG) which include carbon dioxide, methane and sulfur hexafluoride.

To ensure we meet these requirements, PG&E follows an Environmental Management System (EMS) standard modeled after the ISO 14001 environmental management standard and consistent with the ISO standard’s “Plan, Do, Check, Act” model for continuous improvement. The EMS uses a series of compliance work processes that help enable PG&E to manage regulatory compliance and our environmental impacts by each line of business.

The Vice President, Land and Environmental Management of Pacific Gas and Electric Company, oversees our commitment to meeting environmental requirements. PG&E’s integrated planning process provides a mechanism for managing environmental risk and compliance while driving continuous improvement, as do enterprise-wide initiatives such as our Corrective Action Program and numerous other forums.

Compliance performance updates are reviewed monthly by PG&E’s officers, and an annual environmental compliance summary is presented to the Compliance and Public Policy Committee of the PG&E Corporation Board of Directors.

Compliance Program Milestones

Planning

In 2016, PG&E conducted an independent third-party gap analysis of our EMS based on the ISO 14001:2015 standard. This gap analysis yielded detailed recommendations that included updating the existing EMS manual to reflect many of the robust programs that PG&E has in place to protect the environment. This includes re-establishing and communicating the roles and responsibilities within the EMS; promoting general awareness of PG&E’s EMS and Environmental Policy to employees and contractors; and reinstituting a management review policy and internal audit program for regular review and improvement of the EMS. PG&E expects its EMS to be in a certifiable status to the ISO 14001:2015 standard by the end of 2018.

Implementation and Operation

PG&E employs a variety of operational controls to help ensure that the actions we take in meeting our environmental compliance obligations are correct and repeatable. We also learn from our experiences and integrate any lessons into our work processes and staff development.

In 2017, we continued to find new opportunities for applying technologies and processes to further our compliance efforts and minimize impacts on the environment. Key EMS initiatives included:

  • Leveraging our SAP-based tool to analyze trends in environmental compliance.
  • Deploying a cloud-based solution to track and trend data from environmental incidents and compliance activities.
  • Enhancing and expanding the use of an automated tool to assess construction, operations and maintenance activities for potential environmental impacts using geographic information system spatial data.
  • Leveraging enterprise-wide initiatives—such as records and information management and the integrated planning process—to standardize compliance.

In addition, in 2017, PG&E enhanced and continued to standardize the environmental release-to-construction process across all operating lines of business. This process catalogs and provides guidance for operational crews to implement requirements for all activity-specific permits, agreements, authorizations and other environmental requirements.

PG&E conducts extensive training to ensure employees have the skills and knowledge to correctly perform environmental activities associated with their work. Each year, PG&E trains thousands of employees on various environmental compliance responsibilities. Additionally, we require employees to take a training course on our environmental policy to reinforce every employee’s role in supporting PG&E’s goal of environmental leadership.

Reviews and Corrective Actions

A robust environmental auditing program is critical to ensure compliance with the many environmental laws and regulations relating to our business.

We review and audit environmental performance in four ways: self-assessments, comprehensive reviews, compliance and risk management reviews, and internal audits.

  • Self-Assessments: Environmental personnel perform self-assessments of facilities or projects they oversee. Each assessment evaluates a facility or project for compliance with environmental regulations.
  • Comprehensive Reviews: These reviews are performed by personnel from the Land and Environmental Management department who are not responsible for compliance at the facility or the project being inspected. Each comprehensive review involves evaluating all environmental compliance obligations associated with the operation of a facility or project.
  • Compliance Testing and Risk Reviews: These reviews, designed to assess adequacy of controls and risk mitigation, as well as compliance work processes, are conducted by the General Counsel Risk and Compliance Department. This department reports directly to the Vice President, Land and Environmental Management of Pacific Gas and Electric Company, with matrixed reporting to both the PG&E Corporation General Counsel and the PG&E Corporation and Pacific Gas and Electric Company Chief Ethics and Compliance Officer and Deputy General Counsel.
  • Internal Audits: The Internal Auditing department—which reports directly to PG&E Corporation and Pacific Gas and Electric Company Vice President, Internal Audit and Chief Risk Officer—conducts systemic and programmatic controls-based audits to independently analyze the effectiveness of our environmental compliance management systems. The results of these audits are reported annually to the Audit Committees of the PG&E Corporation and Pacific Gas and Electric Company Boards of Directors.

During 2017, we performed 2,609 self-assessments, 50 comprehensive reviews and 3 internal audits for environmental matters.

In pursuit of continuous improvement, we employ a rigorous corrective action process, which includes performing root cause analyses of noncompliance issues identified through environmental agency inspections and tracking detailed corrective action plans to resolution.

Measuring Progress

Operational Performance

PG&E tracks and reports a wide range of annual environmental compliance performance indicators. This section covers our performance results for 2017.

Reported Unintentional Releases and Permit Exceedances

We report unintentional releases that exceed regulatory thresholds, as well as many smaller releases, in an effort to ensure operational transparency to local agencies. We reported a total of 164 releases, defined as an unintentional discharge of a regulated substance that exceeds a reporting threshold or thresholds allowed in applicable permits.

Agency Inspections

In 2017, a total of 539 agency inspections were conducted at our facilities. The majority of these inspections were performed by Certified Unified Program Agencies, such as city and county environmental health departments and fire departments.

Environmental Sanctions and Penalties

To measure compliance results, we categorize all written enforcement actions issued by a regulatory agency as either Level 1 (findings that resulted in an actual or potential environmental impact) or Level 2 (findings that did not result in an actual or potential environmental impact). We also track the percentage of agency inspections that do not result in written enforcement actions.

We received three Level 1 enforcement actions in 2017. Our rate of inspections without a written sanction was 93 percent, about 3 points above our target of 89.75 percent.

In 2017, PG&E paid a total of $28,350 in environmental penalties.

Compliance Data
2015 2016 2017
Level 1 Enforcement Actions 3 3 3
Percentage of Inspections Without a Written Enforcement Action 91% 95% 93%
Releases/Exceedances 170 225 164
Penalties Paid $188,445 $135,650 $28,350
Agency Inspections 641 790 539
Audits Performed Footnote 1 67 62 53
Self-Assessments Performed 5,540 4,752 2,609
  • 1. Includes system audits, internal audits, comprehensive reviews and compliance and risk management reviews performed by PG&E.1

Looking Ahead

PG&E remains committed to continuous improvement of its EMS and expects to be in a certifiable status to the global ISO 14001 standard by the end of 2018. Some of the efforts that will be undertaken to achieve this include:

  • Implementing a process to identify our environmental aspects and leveraging our integrated planning and risk management processes to manage those environmental impacts comprehensively across our lines of business, including adopting shared goals and measuring our progress,
  • Targeting employee training efforts to raise awareness of environmental stewardship and improve proficiency around environmental compliance procedures,
  • Formalizing senior management review of environmental risks and impacts and
  • Instituting continuous improvement and corrective action programs.

These initiatives will help enable PG&E to minimize our environmental impacts, enhance compliance, and further our commitment to sustainable environmental practices.