2008 Corporate Responsibility Report

How we are creating a smarter foundation for a sustainable future
Greening Our Supply Chain

PG&E presented its first Green Supplier of the Year Award to Southwire Company, a major wire and cable manufacturer. Southwire demonstrated exemplary green business practices by reducing waste sent to the landfill by 27 percent, converting 31 percent of its fleet to hybrid vehicles and completing 95 percent of its goal to eliminate lead additives from all products by 2010.

PG&E understands the importance of creating partnerships and collaborating with our suppliers to integrate sustainability more fully into our supply chain. That is why PG&E continued to pilot its Green Supply Chain Program and also founded the Electric Utility Industry Sustainable Supply Chain Alliance with nine other electric utilities in 2008.

More than 30 suppliers have voluntarily engaged in PG&E’s Green Supply Chain Program—implementing a variety of innovative projects not only to reduce the environmental impact of their operations but also to generate bottom-line dollar savings.

For example, PG&E sponsored Southern States, a minority-owned switch manufacturer based in Hampton, Georgia, to complete the U.S. EPA Green Suppliers Network’s “lean and clean” manufacturing review. Southern States is implementing recommendations expected to save approximately $170,000 annually through lighting retrofits, boiler replacements and other energy-saving measures.

By teaming with other large investor-owned electric utilities, our work with the Electric Utility Industry Sustainable Supply Chain Alliance is breaking new ground. For example, we are leading a team focused on developing recommendations to reduce the environmental impacts of utility wood poles.

PG&E continues to drive change and increase awareness about the benefits of a sustainable supply chain among our suppliers and employees. In 2008, more than 15 percent of PG&E’s requests for proposals for procuring materials or services included sustainable evaluation criteria to help guide our selection of suppliers. We also established an interdepartmental team of “Green Champions” to work collaboratively with suppliers to help reduce their carbon footprint and improve environmental performance.

Last year, we also launched a “Think Before You Print” campaign to encourage employees to save energy and paper. Key components of the campaign included implementing double-sided printing and increasing our use of shared network printers. As a result, we expect to save approximately 40 tons of paper in 2009. And PG&E began the systematic use of retread tires in our medium- and heavy-duty vehicles, which will avoid more than 20 gallons of oil per tire produced.

Moving forward, PG&E’s green supply chain efforts will continue to reinforce our collaborative commitment to environmental leadership and make a positive impact across our industry.