Climate Change

1/3 PG&E’s emissions rate for the electricity delivered to customers, measured in pounds of CO2 per MWh, is about one-third the national utility average.

As a provider of electricity and natural gas to millions of Californians, PG&E understands our responsibility to manage our carbon footprint, advance policies that put our state and the country on a cost-effective path toward a low-carbon economy, and address the emerging need to adapt to changing climate conditions. We also remain focused on providing customers with industry-leading tools and incentives to help them manage and reduce their energy use.

Our Approach

Reporting Our Impacts

We believe it is critical 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 (ARB) and 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, an international not-for-profit organization that requests information on behalf of institutional investors.

Engaging Our Customers

As an integral part of our business, we work 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 reduce emissions—providing them with community energy profiles to assess opportunities and connecting them with PG&E programs and other resources that meet local needs.

Addressing Our Own Carbon Footprint

PG&E understands the imperative of reducing emissions from the utility sector. While some companies have adopted voluntary greenhouse gas reduction goals, PG&E is working to meet the targets established by California’s Global Warming Solutions Act, or AB 32. This law requires the gradual reduction of greenhouse gas emissions in California to the 1990 level of 431 million metric tons of CO2-equivalent by 2020. The cap covers emissions from PG&E’s fossil-fuel power plants, natural gas compressor stations, and electricity imported into California, and in 2015 will cover the emissions from the combustion of natural gas delivered to customers.

We are actively working to reduce our carbon footprint in a variety of ways such as increasing supplies 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.

Advancing Responsible Policy Solutions

PG&E is committed to promoting a diverse set of low- and zero-carbon resources to drive clean energy innovation in California and beyond. Such an approach can reduce greenhouse gas emissions in a way that is economically sustainable and environmentally effective, while spurring innovation and job creation.

PG&E is actively engaged in ARB’s stakeholder activities to refine the implementation of California’s cap-and-trade program to meet AB 32’s greenhouse gas emissions reduction goals at the lowest possible cost to customers. Features that will help mitigate costs to customers include free allocation of greenhouse gas emissions allowances to utilities for the benefit of their customers, a sufficient supply of high-quality offsets, robust market oversight and an allowance price containment reserve that reduces the risk of excessively high allowance prices.

With the announcement of U.S EPA’s proposed new carbon dioxide regulations for existing and new power plants under section 111 of the Clean Air Act, we will work closely with the state of California and U.S. EPA to ensure that the final rules align with California’s Global Warming Solutions Act and the progress made to date toward reducing greenhouse gas emissions from California’s electricity mix. Ultimately, PG&E wants to ensure U.S. EPA’s rules provide flexibility to recognize the unique circumstances and emissions profiles of power companies and individual states across the country, so that we and others in our industry can continue providing safe, reliable, affordable and clean energy to our customers.

Central to our approach is engaging at the state, federal and international levels across a variety of coalitions such as the Business Council for Sustainable Energy, Coalition for Emission Reduction Policy, Center for Climate and Energy Solutions, Alliance to Save Energy, Edison Electric Institute, Bipartisan Policy Center, Electric Power Research Institute, International Emissions Trading Association, Natural Gas Downstream Initiative, and the Electric Drive Transportation Association.

Planning for Potential Climate Change Impacts

Since 2008, PG&E has been investigating the potential physical risks of climate change to PG&E’s system. An in-house climate science team regularly reviews the most relevant scientific literature on how sea level rise, temperature changes, rainfall and runoff patterns, wildfire risk, and storm frequency and intensity affect California and the West.

This research is integrated into PG&E’s risk management process, helping to identify potential impacts on PG&E assets and enabling potentially affected business units to evaluate climate change-related risks to facilities and develop the necessary adaptation strategies. PG&E also engages with leaders from business, government, academia and nonprofits to share information, best practices and plan for the future.

2013 Milestones

In 2013, we continued to minimize our carbon footprint:

  • Increased renewable energy. We stayed on track to meet the state’s requirement to deliver 33 percent renewable energy by the end of 2020. By the end of 2013, we reached 22.5 percent—plus an additional 10 percent from large hydro.
  • Reduced methane emissions. We avoided the release of more than 45,000 metric tons of CO2-equivalent emissions. These savings were achieved primarily by replacing older gas mains, and by implementing a technique called cross-compression, where natural gas is transferred from one pipeline to another during pipeline construction and repair projects.
  • Reduced our sulfur hexafluoride (SF6) emissions. Since 1998, we’ve reduced our total SF6 emissions by 75 percent and our emissions rate by 87 percent. SF6 is used as an electrical insulating material in high-voltage circuit breakers and gas-insulated substations.
  • Reduced facility energy use. We reduced energy use by 3.5 percent, meeting our annual target and avoiding more than 800 metric tons of CO2 emissions. We stayed on track to meet our five-year reduction goal of 15 percent by 2014.
  • Continued to “green” our fleet. Our use of natural gas in fleet vehicles avoided nearly 3,000 metric tons of CO2 emissions on a “well-to-wheel” basis. We expect further reductions as a result of increasing use of plug-in vehicle technologies.

Offering a Green Option

PG&E is seeking to offer a new “Green Option” that will give customers the opportunity to support 100 percent renewable energy for an average cost of a few dollars more each month. The proposed program would provide participating customers with energy from new small- and mid-sized solar projects located in PG&E’s service area.

With respect to potential increased electricity demand due to 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 to offset the expected increased demand for electricity. PG&E is also conducting increased vegetation management activities to reduce the risk of wildfire impacts on electric and gas facilities.

To plan for potential snowpack reductions in the Sierra Nevada Mountains, which could affect hydropower availability, PG&E is actively engaging with state and local stakeholders and also adopting strategies such as maintaining higher winter carryover reservoir storage levels, reducing discretionary reservoir water releases and developing new modeling tools for forecasting runoff.

PG&E also continues to engage with multi-stakeholder groups on climate adaptation, including the Bay Area Climate and Energy Resilience Project, Climate Adaptation Forum and the Silicon Valley 2.0 Climate Adaptation Working Group.

Measuring Progress

Mandatory Emissions Reporting

Under AB 32’s annual greenhouse gas emissions 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.

In 2015, as part of California’s cap-and-trade system, PG&E anticipates a compliance obligation associated with the emissions from the combustion of natural gas supplied to customers, excluding the fuel that is delivered to covered entities. The following table shows the greenhouse gas emissions data PG&E reported to the ARB under AB 32.

PG&E Emissions Reported to the California Air Resources Board:
CO2 Emissions from Owned Power Generation1 and Operations
  2011 2012 2013
Total CO2 Emissions (metric tons) 2,024,206 2,464,464 2,380,159
Humboldt Bay Generating Station 216,417 193,004 163,242
Gateway Generating Station 1,042,896 1,246,180 1,237,351
Colusa Generating Station 764,894 1,025,280 979,566
 
CO2 Emissions Rates (lbs/MWh)
Humboldt Bay Generating Station 1,022 1,020 997
Gateway Generating Station 868 866 857
Colusa Generating Station 851 838 852
Fossil Plants 875 864 863
All Plants 126 172 167
 
Other CO2-e Emissions (metric tons)
Natural Gas Compressor Stations2 258,672 351,878 325,701
Distribution Fugitive Natural Gas Emissions 224,298 222,995 213,858
Customer Natural Gas Use3 39,049,732 42,434,940 43,506,493
  • 1 PG&E’s utility-owned generation comprised approximately 40 percent of our delivered electricity in 2013. PG&E also reported N2O and CH4 emissions from each of our generating stations.
  • 2 Includes compressor stations emitting more than 25,000 metric tons of CO2-e annually. The increase in 2012 was largely due to the inclusion of one additional compressor station that crossed this emissions threshold.
  • 3 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 will be 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 the U.S. EPA under its mandatory reporting requirements.

Voluntary Emissions Reporting

PG&E’s voluntary greenhouse gas emissions reporting showed that PG&E’s carbon dioxide emissions rate was approximately 30 percent below the California utility average and 65 percent below the national utility average in 2012, the most recent year for which verified data are available. PG&E’s emissions rate of 445 pounds of CO2 per megawatt-hour of delivered electricity takes into account both PG&E-owned power generation and power purchased from third parties.

From year to year, several factors affect PG&E’s power mix and emissions, including demand growth and the availability of clean hydro power. However, PG&E’s emissions have continued a downward trend. Our 2012 emissions rate is 17 percent lower than the past five-year average of 538 pounds of CO2 per megawatt-hour.

Benchmarking Greenhouse Gas Emissions for Delivered Electricity (Pounds of CO2 per MWh)
  • 1 Source: U.S. Environmental Protection Agency eGRID Version 1.0, which contains year 2010 information configured to reflect the electric power industry’s current structure as of February 24, 2014.
  • 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 total CO2 emissions from delivered electricity rose to 16.5 million metric tons in 2012. This was largely due to a drop in hydroelectric output equal to 8 percent of our power mix, resulting from a relatively dry year. This loss of hydro generation was made up through gas-fueled power generation that PG&E owns and power purchases from third-party generators.

Other emissions increases were driven by greater customer demand for natural gas and increased hydrostatic testing of natural gas pipelines. Reported increases also reflected improved methods for measuring process and fugitive natural gas emissions and electric line losses.

PG&E’s Scope 1, 2 and 3 Greenhouse Gas Emissions
Subtotals
  • 2010: 54.59
  • 2011: 50.71
  • 2012: 57.49
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
  • 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.
Scope 1 Greenhouse Gas Emissions
Totals
  • 2010: 3.62
  • 2011: 3.46
  • 2012: 4.11
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
Scope 2 Greenhouse Gas Emissions
Totals
  • 2010: 1.14
  • 2011: 1.20
  • 2012: 1.26
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
Scope 3 Greenhouse Gas Emissions
Totals
  • 2010: 49.83
  • 2011: 46.06
  • 2012: 52.12
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
  • 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.
Total Greenhouse Gas Emissions by Source Category
Totals
  • 2010: 54.59
  • 2011: 50.71
  • 2012: 57.49
  • 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.

Assistance to Local Communities

PG&E provides financial and technical support to local governments for greenhouse gas inventories and developing climate action plans tailored to the unique needs of individual communities. The inventories include analyses of energy consumption, vehicle fuel use and waste production to provide a baseline for measuring progress. Climate Action Plans outline a set of policies, programs and ordinances necessary to meet greenhouse gas reduction goals at the local level.

Partnering with Local Communities1
Cumulative number of greenhouse gas inventories supported (municipal and community-wide) 271
Cumulative number of Climate Action Plans supported 64
1 Data represents totals through 2013.

Looking Ahead

We will continue to actively support the successful implementation of AB 32 and California’s cap-and-trade program. We also support the objective of reducing power-sector CO2 emissions through the Clean Air Act and will continue to participate in discussions with the U.S. EPA, the state of California and stakeholders as the framework and details for the rules are finalized.

Technologies such as the Picarro Surveyor helps PG&E identify leaks much more quickly.

Another emerging focus for PG&E is reducing process and fugitive natural gas emissions from our pipelines. PG&E is one of five members of the Natural Gas Downstream Initiative, which is focusing on reducing methane leaks by encouraging investments in infrastructure, modernizing gas systems and using next-generation technologies. On the research side, PG&E is partnering with the American Gas Association, the U.S. EPA, Washington State University and other gas utilities on a study to measure methane emissions from the natural gas distribution system. When published, this study will help us better measure PG&E’s natural gas emissions, determine appropriate management methods, and inform our engagement with policymakers to guide how best to address this source of emissions.

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