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Environment

Addressing Climate Change

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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 gas and electricity to millions of Californians, PG&E is keenly aware of its responsibility to both manage its greenhouse gas emissions and to help advance policies that support a cost-effective transition toward a low-carbon economy. This includes our continuing focus on the successful implementation of California’s landmark Global Warming Solutions Act or Assembly Bill (AB) 32.

Addressing climate change is an integral part of our environmental commitment. This ranges from our role as a national advocate for aggressive energy efficiency programs to our efforts to expand renewable energy supplies and provide new tools and incentives to help our customers understand, manage and reduce their energy use.

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 and to The Climate Registry on a voluntary basis as described below.

Mandatory Emissions Reporting

Since 2009, PG&E has fulfilled AB 32’s annual greenhouse gas emissions reporting requirements, reporting combustion emissions from our electric generation facilities and natural gas compressor stations to the ARB. Since 2011, PG&E also has reported the greenhouse gas emissions from 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 natural gas supplied to customers, less 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
2010 2011 2012
Total CO2 Emissions (metric tonnes) 1,545,892 2,024,206 2,464,464
Humboldt Bay Power Plant2 276,811 N/A N/A
Humboldt Bay Generating Station3 59,111 216,417 193,004
Gateway Generating Station4 1,209,970 1,042,896 1,246,180
Colusa Generating Station5 N/A 764,894 1,025,280
 
CO2 Emissions Rates (lbs/MWh)
Humboldt Bay Power Plant 1,591 N/A N/A
Humboldt Bay Generating Station 1,004 1,022 1,020
Gateway Generating Station 861 868 866
Colusa Generating Station N/A 851 838
Fossil Plants 943 875 864
All Plants 106 126 172
 
Other CO2 Emissions (metric tonnes)
Natural Gas Compressor Stations6 235,789 237,985 324,378
Fugitive Natural Gas Emissions7 N/A 244,951 250,494
Customer Natural Gas Use8 N/A 39,049,732 42,434,940
  • 1 PG&E’s utility-owned generation comprised more than 40 percent of our delivered electricity in 2012. PG&E also reported N2O and CH4 emissions from each of our generating stations.
  • 2 The Humboldt Bay Power Plant facilities, two operating fossil fuel-fired plants and two mobile turbines, were retired at the end of September 2010.
  • 3 Humboldt Bay Generating Station became operational in September 2010.
  • 4 Gateway Generating Station became operational in January 2009.
  • 5 Colusa Generating Station became operational in December 2010 and was exempt from CO2 reporting for 2010.
  • 6 Includes compressor stations emitting more than 25,000 metric tonnes of CO2-e annually. The increase in 2012 was largely due to the inclusion of one additional compressor station that crossed this emissions threshold.
  • 7 Includes fugitive emissions from PG&E’s compressor stations and gas distribution system.
  • 8 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.

Beginning with 2010, PG&E also reported the greenhouse gas emissions from our facilities and operations to the U.S. EPA under its mandatory reporting requirements. Since 2011, our emissions report has also included emissions from natural gas delivered to customers and fugitive emissions from our natural gas distribution system, including compressor stations. However, differing from ARB’s reporting requirements, the U.S. EPA regulations exclude PG&E accounting for natural gas delivered to “large” end users (those that consume more than 460 million cubic feet of natural gas annually).

Voluntary Emissions Reporting

PG&E was a charter member of the California Climate Action Registry and voluntarily reported its greenhouse gas emissions to the organization annually from 2002 through 2008. PG&E has since voluntarily reported its greenhouse gas emissions to The Climate Registry, a successor non-profit entity that has reporting and measurement standards applicable to most industry sectors across North America.

In 2011, the total CO2 emissions from PG&E’s delivered electricity were the lowest on record—declining about six percent from the prior year to 14.7 million metric tonnes as reported to The Climate Registry. This decline reflected an increase in the amount of renewable and large hydro electricity in our power portfolio and the expanded use of cleaner fossil-fueled electricity. The latter included the first full year of operations for two new, state-of-the-art natural gas-fired plants owned and operated by PG&E. Several factors affect PG&E’s power mix and emissions from year to year, including demand growth and the availability of hydro power.

In 2011, PG&E’s independently verified CO2 emissions rate associated with the electricity delivered to customers was 393 pounds of CO2 per MWh, about 12 percent lower than the prior year. PG&E’s emissions rate was about 40 percent cleaner than the California average and more than 65 percent cleaner than the national utility average. Our emissions rate takes into account emissions from both PG&E-owned power generation and power purchased from third parties.

Beginning in 2010, PG&E expanded its voluntary greenhouse gas emissions inventory to include the emissions associated with the natural gas that we delivered to customers. This is an emerging area that PG&E will continue to explore in light of evolving reporting requirements and best practices for this aspect of our business.

Click on the links below to review PG&E’s greenhouse gas emissions data reported to The Climate Registry.

PG&E’s Scope 1, 2 & 3 Greenhouse Gas Emissions
Subtotals
  • 2009: 23.59
  • 2010: 54.59
  • 2011: 50.71
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 For 2010 and 2011, 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
  • 2009: 3.22
  • 2010: 3.62
  • 2011: 3.45
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
Scope 2 Greenhouse Gas Emissions
Totals
  • 2009: 1.00
  • 2010: 1.14
  • 2011: 1.21
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
Scope 3 Greenhouse Gas Emissions
Totals
  • 2009: 19.38
  • 2010: 49.83
  • 2011: 46.06
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
  • 1 For 2010 and 2011, 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
  • 2009: 23.59
  • 2010: 54.59
  • 2011: 50.71
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 For 2010 and 2011, 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.
Breakdown of Emissions by Greenhouse Gas
Totals
  • 2009: 23.59
  • 2010: 54.59
  • 2011: 50.71
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
  • 1 PG&E emits no perfluorocarbons (PFCs).
  • 2 For 2010 and 2011, 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.
Benchmarking Greenhouse Gas Emissions for Delivered Electricity
TIP: Click on the items in the chart legend to selectively remove or restore chart data.
  • 1 Source: U.S. Environmental Protection Agency eGRID2012 Version 1.0, which contains year 2009 information configured to reflect the electric power industry’s current structure as of May 10, 2012.
  • 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 Sulfur Hexafluoride (SF6) Emissions
PG&E’s Sulfur Hexafluoride (SF6) Emissions
2010 2011 2012
Total SF6 Emissions (metric tonnes CO2-equivalent) 69,066 70,057 63,127
SF6 Emissions Rate 1.8% 1.7% 1.5%

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 Solution Act, or AB 32. This law requires the gradual reduction of greenhouse gas emissions in California to the 1990 level of 427 million metric tons of CO2-equivalent by 2020. The cap covers emissions from PG&E’s generated and purchased electricity as well as natural gas delivered to customers.

In addition, separate from AB 32, PG&E’s facilities in the nine-county San Francisco Bay Area pay a greenhouse gas emissions fee of 4.8 cents per metric tonne of CO2-equivalent on emissions from facilities such as fossil-fueled power plants, natural gas compressor stations and emergency generators.

We continue to work to minimize our carbon footprint. Ongoing efforts include the following:

  • We are fully committed to meeting the state’s Renewable Portfolio Standard (RPS) requirement to deliver 33 percent renewable energy by the end of 2020. By the end of 2012, 19 percent of the electricity we delivered to our customers came from RPS resources, primarily from contracts with renewable energy companies. We have also commissioned three clean, highly efficient and flexible natural gas-fueled generating facilities since early 2009.
  • We have a goal to reduce energy use by 15 percent in MMBtus at PG&E offices and service yards by 2014 from a 2009 baseline, equivalent to avoiding approximately 4,000 metric tonnes of CO2. In 2012, we reduced energy use by 3.1 percent—or nearly 13,000 MMBtus—exceeding our 3 percent target. In 2013, our goal is to achieve an additional 3.5 percent reduction.
  • We avoided the release of 258 MMcf of natural gas—or nearly 100,000 metric tonnes of CO2-equivalent emissions—in 2012. These savings were achieved primarily by replacing older gas mains, and by implementing a technique called cross compression at 13 projects, where natural gas is transferred from one pipeline to another during large pipeline construction and repair projects.
  • We reduced our sulfur hexafluoride (SF6) emissions nearly 10 percent compared to 2011. Since 1998, we have reduced our total SF6 emissions by 75 percent and our emissions rate by 87 percent. SF6 is an extremely potent greenhouse gas, approximately 23,900 times more potent than CO2 on a per ton basis, and is used as an electrical insulating material in high-voltage circuit breakers and gas-insulated substations. We will comply with ARB’s requirement to reduce the maximum annual SF6 emissions rate for electric utility gas insulated switchgear from 10 percent in 2011 to 1 percent in 2020 and beyond. PG&E’s 2012 SF6 emissions rate was 1.5 percent.
  • We reduced emissions through the use of lower-emission transportation technologies in our fleet. In 2012, PG&E’s use of natural gas in fleet vehicles resulted in more than 2,200 metric tonnes of avoided CO2 emissions on a “well-to-wheel” basis. We expect further reductions as a result of increasing use of plug-in vehicle technologies.

PG&E also introduced a set of Supplier Environmental Performance Standards to our largest suppliers in 2012. The standards, which include greenhouse gas emissions, provide suppliers with a clear and concise set of expectations for performance in the areas of environmental impacts, voluntary reduction goals and public disclosure of performance.

Sulfur Hexafluoride (SF<sub>6</sub>) Absolute Emissions, 1998 – 2012

Engaging Our Customers

We continue to work with customers to achieve energy savings and greenhouse gas emission reductions through a full portfolio of options, including some of the nation’s leading programs and incentives for energy efficiency, demand response and solar installation.

In 2012, PG&E proposed a Green Option program that will let customers support 100 percent renewable energy for an average of a few dollars more a month. PG&E reached an agreement on the program with a diverse group of consumer groups and other organizations in 2013 and we are awaiting regulatory approval. The proposed program would provide participating customers with energy from new small- and mid-sized solar projects located in PG&E’s service area.

Cities and counties in our service area are working to meet the goals of AB 32. PG&E’s Sustainable Communities effort provides training, assistance and data to help local governments with long-term energy efficiency and greenhouse gas reduction planning. PG&E partners with the international organization ICLEI-Local Governments for Sustainability and several local and regional community-based organizations to help cities and counties develop greenhouse gas inventories and climate action plans, which serve as roadmaps for local governments to reduce their carbon footprint.

Through 2012, PG&E provided financial and technical support to local governments for more than 230 greenhouse gas inventories and 57 climate action plans tailored to the unique needs of individual communities. We have offered aggregated energy consumption and emission data to more than 70 percent of the communities in our service area. The inventories include analyses of energy consumption, fuel use and waste production, and provide a starting point for reductions. For example, PG&E helped create the City of American Canyon Climate Action Plan that was adopted by the City Council in 2012.

Partnering with Local Communities (Assistance through 2012)
Cumulative Number of Greenhouse Gas Inventories (Municipal and Community-Wide) 231
Cumulative Number of Climate Action Plans 57
Jurisdictions Provided Aggregated Energy Consumption and Emissions Data (%) 73%

A team of community energy managers located throughout our service area helps local governments develop strategies and implementation plans to reduce community-wide greenhouse gas emissions. The team educates local government staff about each community’s energy profile, promotes existing PG&E programs, develops new programs to meet local needs and connects them with internal and external resources.

Advancing Responsible Climate Change Policy Solutions

At the state level, PG&E continues to engage in ARB’s stakeholder activities to refine the implementation of the cap-and-trade program, guided by three overarching objectives: to meet AB 32’s greenhouse gas emissions reduction goals, manage costs for customers and ensure the program can be integrated effectively with emerging regional, national and international programs. 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 robust supply of high-quality offsets, robust market oversight and an allowance price containment reserve designed to ensure entities will not be subject to high allowance prices.

We believe that a well-designed, multisector market-based program, combined with cost-effective renewable resources and energy efficiency, can put the state and the nation on a path to a low-carbon economy. Such an approach can reduce greenhouse gas emissions in a way that is economically sustainable and environmentally effective, while also spurring innovation and job creation.

Although there have been several legislative attempts to address climate change through nationwide regulatory limits on greenhouse gas emissions, the probability of federal climate change legislation has dimmed. That said, PG&E continues to participate in the U.S. EPA’s regulatory process, including making recommendations as a member of the EPA’s Clean Air Act Advisory Committee. Further, with the Presidential Memorandum to the EPA on Power Sector Carbon Pollution Standards, a clearer regulatory policy path for regulating emissions from new and existing sources under the Clean Air Act has begun. PG&E will be an active participant in future discussions with the EPA, the State of California and stakeholder organizations as the framework and details for these proposals are drafted.

PG&E also remains engaged on climate change and other environmental policy issues at the federal level with coalitions such as the Business Council for Sustainable Energy, Coalition for Emission Reduction Policy, Center for Climate and Energy Solutions, Alliance to Save Energy, Electrification Coalition, Edison Electric Institute, Bipartisan Policy Center and the Electric Drive Transportation Association.

Understanding the Potential Physical Impacts to Our Business

In the last several years, California scientists and policymakers have increased their focus on potential environmental impacts of climate change. For example, in 2009, the State of California published a Climate Change Adaptation Strategy, and in 2010, the California Adaptation Advisory Panel to the State of California published Preparing for the Effects of Climate Change: A Strategy for California, both of which reference studies on the potential physical impacts of climate change in California.

These reports have identified four main potential risks for our sector: increased electricity demand from more extreme and frequent hot weather events; reductions in hydroelectric generation due to reductions in snowpack in parts of the Sierra Nevada Mountains; increased wildfire risk; and impacts to facilities due to sea level rise and increased storm surges.

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 periodically 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 helps identify potential impacts on PG&E assets and enables 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.

Planning for Potential Climate Change Impacts

During 2012, PG&E continued to develop strategies to mitigate the impact of our operations (including customer energy usage) on the environment and to plan for the actions that we will need to take to adapt to the likely impacts that climate change will have on our future operations.

With respect to electric operations, climate scientists project that sometime in the next several decades climate change will lead to increased electricity demand due to more extreme, persistent and frequent hot weather events. 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—will help to offset the expected increased demand for electricity. PG&E is also conducting increased vegetation management to reduce the risk of wildfire impacts on electric and gas facilities.

PG&E hydrographers conduct a snow survey in the Sierras.

PG&E hydrographers conduct a snow survey in the Sierras. PG&E has adaptation strategies in place to mitigate the impact of climate change on our hydroelectric generation.

Climate scientists also predict that climate change will result in significant reductions in snowpack in parts of the Sierra Nevada Mountains. This impact could, in turn, affect PG&E’s hydroelectric generation. At this time, PG&E does not anticipate that reductions in Sierra Nevada snowpack will have a significant impact on our hydroelectric generation in the near term, due in large part to our adaptation strategies. These strategies include developing new modeling tools for forecasting runoff, maintaining higher winter carryover reservoir storage levels, reducing conveyance flows in canals and flumes during winter storms as more precipitation falls as rain, and reducing discretionary reservoir water releases.

PG&E is working with the U.S. Geological Survey and the California Department of Water Resources to model and better understand the potential impacts of mountain snowpack loss on California’s Sierra and southern Cascade low-elevation watersheds. Procedures for tracking and classifying climate change’s potential to impact our lines of our business have been developed for sea level rise, temperature change and the effects of precipitation change.

Additionally, PG&E has developed a snowmelt runoff tracking procedure to identify and track climate change’s potential impacts on small watershed areas, investigated Northern California’s aquifers to better understand how they may respond to climate change's potential impacts and worked with local communities in Northern California to increase awareness of decreasing water flows so that these communities can explore local adaptation measures. PG&E has also presented and published several scientific papers on our research and investigations into how climate change is impacting the Northern Sierra Nevada and Southern Cascade watersheds that supply our hydroelectric system.

If PG&E is not successful in fully adapting to projected reductions in snowpack over the coming decades, it may become necessary to replace some of our hydroelectric generation with electricity from other sources.

Scientists also project that climate change will cause sea levels along California’s coast to slowly rise by a meter or more within this century, which may result in higher flooding potential at PG&E’s low elevation facilities. PG&E is working with the California Energy Commission and the University of California, Berkeley to study the effects of sea-level rise and water flow around our natural gas storage facility and infrastructure at McDonald Island in the Sacramento River Delta. PG&E is also engaged with multi-stakeholder groups on climate adaptation, including the Bay Area Climate and Energy Resilience Project, Adapting to Rising Tides and the Silicon Valley 2.0 Climate Adaptation Working Group.