2008 Corporate Responsibility Report

How we are creating a smarter foundation for a sustainable future
A Landmark Investment in Greenhouse Gas Emission Reductions

With support from the ClimateSmart™ program, the Garcia River Forest project will sequester 200,000 metric tonnes of CO2.
Photo courtesy of The Conservation Fund

The Lompico Headwaters Forest will capture 14,000 metric tonnes of greenhouse gas emissions by permanently preserving 425 acres of trees once slated for harvest.
Photo courtesy of Sempervirens Fund

Breaking new ground, PG&E’s pioneering ClimateSmart™ program is a voluntary, tax-deductible program that allows customers to balance out the greenhouse gas emissions that are produced by the energy they use, making their energy use “carbon neutral.” To date, more than 30,000 customers, including PG&E, have enrolled in the program—from household names such as IKEA and eBay to leading cities such as the town of Windsor and city of Millbrae.

To participate, customers pay a separate amount on their monthly energy bill, based on their actual energy use. PG&E invests 100 percent of these payments in new, independently verified projects that reduce or remove greenhouse gases from the atmosphere. While PG&E more than doubled customer enrollment in 2008, participation has been below PG&E’s stretch goal range, and we remain focused on engaging more customers.

Last year, the program took a major step forward by announcing the largest investments in verifiable greenhouse gas emission reductions under the Climate Action Reserve's rigorous forest carbon sequestration project protocols—turning customer enrollments into investments in forestry projects that will sequester 214,000 metric tonnes of greenhouse gas emissions.

Following an extensive competitive bidding process, PG&E selected two landmark projects. Located on California’s North Coast, the Garcia River Forest project is operated by The Conservation Fund and managed in partnership with The Nature Conservancy. The Lompico Headwaters Forest project is operated by the Sempervirens Fund in Santa Cruz County.

Both projects are located in coastal redwood forests, which have among the highest carbon density per acre in the world. The protected trees also provide a habitat for rare and endangered species, supply clean and safe drinking water and deliver valuable aesthetic and recreational benefits.

In 2009, PG&E also secured contracts for another forestry project with The Conservation Fund and our first manure management project, bringing the program’s total emission reductions to nearly 890,000 metric tonnes. PG&E will permanently retire the reductions on behalf of enrolled customers—thereby deriving no benefit from the offset purchases.

The groundbreaking program also continued to make headlines when Governor Schwarzenegger signed a memorandum of understanding between the state of California, PG&E, the California Climate Action Registry and the six Mexican states that border the United States—designed to support greenhouse gas emission reduction projects in the Mexican states for potential future use in the ClimateSmart program.