Corporate Responsibility and Sustainability Report 2017

Our Approach

In recent years, as the state faced extreme drought conditions, an internal Drought Task Force led our response by working to identify and address impacts on PG&E’s operations, on our customers and in our communities.

Water is essential to operating our infrastructure—including our vast network of hydroelectric generating stations—just as it is essential to our customers in their daily lives. At the same time, about 20 percent of California’s electricity usage goes toward moving, treating, disposing of, heating and consuming water. This connection, also known as the “water-energy nexus,” places PG&E in a unique position to help our state and our customers.

PG&E is promoting sustainable water use in a number of ways:

• Strategically managing our power generation facilities,
• Reducing water consumption at PG&E offices and service yards,
• Coordinating with key agencies to prevent and prepare for wildfires, and
• Providing outreach and guidance to customers, particularly those in the agricultural community, on how to reduce water usage.

PG&E also reports its water data and strategies to the CDP (PDF), an international not-for-profit organization that requests information on behalf of institutional investors.

Water Use at Diablo Canyon

PG&E does not use freshwater for cooling at any of our power plants. At the Diablo Canyon Power Plant, we use saltwater from the Pacific Ocean for once-through cooling. The 2,240 MW nuclear power plant has a maximum discharge of 2.5 billion gallons per day, set by the facility’s Clean Water Act permit. PG&E closely monitors the marine environment at the plant by conducting regular studies and sampling, also required under the plant’s Clean Water Act permit.

In May 2014, the Environmental Protection Agency issued federal regulations under Section 316(b) of the Clean Water Act to minimize adverse environmental impacts from facilities that use once-through cooling. These regulations allow Diablo Canyon to continue to be regulated under California’s once-through cooling policy adopted in 2010, which is considered to be at least as stringent as the new federal regulations. At the state level, the California Water Board has adopted a policy on once-through cooling that generally requires the installation of cooling towers or other significant measures to reduce the impact on marine life from existing power generation facilities in California by at least 85 percent.

Diablo Canyon must comply with state policy by December 31, 2024. However, nuclear facilities may be granted an alternative to the compliance requirements if they meet certain cost and technical feasibility criteria. An alternative technologies assessment was completed in 2014 by Bechtel, with oversight by the nuclear review committee established by the State Water Resources Control Board. Given PG&E’s announcement of a joint proposal indicating that, pending CPUC approval, we would not seek to relicense Diablo Canyon at the end of our existing nuclear licenses, we will comply with the state’s policy without approval of alternative compliance requirements and pay an annual interim mitigation fee until Diablo Canyon ceases operation.

In addition, PG&E uses an on-site desalination plant to generate the majority of freshwater that supports the internal operations of the Diablo Canyon facility.

Dry Cooled Conventional Sources

PG&E relies on air for cooling at its three natural gas power plants:

• Humboldt Bay Generating Station is cooled with air radiators using a closed-loop liquid coolant and requires minimal water use.
• Gateway Generating Station employs an air-cooled condenser, which uses approximately 97 percent less water and discharges 98 percent less wastewater than a traditional once-through cooled plant.
• Colusa Generating Station uses dry cooling and a zero liquid discharge system that recycles wastewater.

PG&E uses some freshwater for internal operations at the plants, but these are largely closed-loop systems that minimize the amount of water consumed.

Hydroelectric Generation

PG&E owns and operates one of the nation’s largest investor-owned hydroelectric systems. Our hydroelectric power plants are largely non-consumptive, meaning that after water passes through turbines to produce electricity, it is returned to the river.

PG&E’s 1,212 MW Helms Pumped Storage Project also uses water for energy storage to help balance daily variations in electric demand. Nested high in the Sierra Nevada mountains, the non-consumptive Helms facility dispatches water from an upper reservoir to a lower reservoir to produce electricity when demand is high, pumping it back uphill when demand is low.

Water Conservation in Our Facilities

PG&E’s offices and service centers rely on water for restrooms, kitchens, mechanical system cooling, vehicle washing and landscape irrigation. We remain focused on identifying, reporting and repairing leaks quickly; managing our irrigation systems; installing low-flow plumbing fixtures; and replacing landscaping with drought-resistant approaches.

Helping Customers Reduce Water Use

PG&E offers customers a wide range of options to help them reduce their water use. Our water-saving solutions for residential customers include energy efficiency rebates for high-efficiency appliances, such as clothes washers and shower heads, and free wood chips for landscape mulching, which reduces evaporation. We also offer incentives to agricultural customers who convert from sprinkler systems to water-efficient drip irrigation, as well as programs for energy efficient pumping systems and more.

Altogether, customers who participated in PG&E’s programs reduced water usage by about 780 million gallons in 2016, based on an analysis of our most common energy efficiency measures that deliver water savings.

2016 Milestones

As the drought’s effects persisted, PG&E partnered to conserve water and protect the watersheds where we operate. Our achievements in 2016 included:

• Strategically managed our hydroelectric facilities. Working with state agencies and other stakeholders, we found ways to manage water in our reservoirs so we could generate power during the summer peak demand periods. Conserving water early in the season also helps ensure adequate water supplies for communities, supports recreation and benefits the many species that depend on water.
• Took additional steps to prevent and mitigate wildfires. In addition to our routine vegetation management program through which we inspect all of our overhead electric lines, PG&E provided $2 million in funding to local Fire Safe Councils to protect communities from wildfires in at least 18 high fire-risk counties by clearing brush and dead, dying or diseased trees for the current fire season. PG&E also conducted daily aerial smoke patrols over much of our service area—more than 2,800 hours of flight time in total—spotting 142 fires.
• Conserved water at PG&E facilities. We took steps to reduce water usage; however, unexpected leaks at three sites proved challenging and impacted our performance. As a result, water use remained steady and we fell short of our 3.5 percent reduction target.
• Expanded agricultural energy efficiency programs and incentives. We offered rebates and incentives on water and energy-saving appliances and equipment for our agricultural customers, including pump efficiency incentives, variable frequency drive rebates and energy efficiency financing. We are developing new approaches for managing irrigation and using audits to recommend energy and water conservation for food processing facilities.

Measuring Progress

• 1. Net operating capacity on December 31, 2016: Diablo Canyon: 2,240 MW; Humboldt Bay Generating Station: 163 MW; Gateway Generating Station: 580 MW; Colusa Generating Station: 657 MW. ^{▲ 1a, 1b, 1c, 1d}
• 2. Freshwater sources consist of well water for backup and emergency purposes. ^▲
• 3. This figure represents the water supplied to offices and service yards managed by the Utility’s Corporate Real Estate Strategy and Services department for the 12-month period from October to September. ^▲
• 4. PG&E monitors water usage at permitted, public water systems owned and operated by PG&E. These systems are metered in accordance with state regulations. ^▲
• 5. These figures incorporate once-through cooling discharge (equivalent to withdrawal) plus estimated reverse osmosis system brine/backwash discharge. ^▲
• 6. Colusa Generating Station uses a zero liquid discharge system. A septic system is used to manage sanitary waste. ^▲
• 7. Of these totals, a portion of water was reused for other hydrostatic testing prior to being discharged, and more than half was recycled or reused for irrigation or dust control. ^▲

Looking Ahead

Even though drought conditions have eased considerably for much of California, the impacts on groundwater supplies and tree mortality are still evident. Moreover, this year’s record precipitation following the historic drought signals the importance of planning for extreme weather conditions and their effects, including increased land subsidence and flooding risk as snow melts in the Sierra Nevada.

PG&E will continue to promote water conservation with our customers, in our communities and at our facilities. We will also continue our wildfire prevention efforts—pruning or removing trees to prevent them from contacting power lines. We will also continue to strategically manage our hydroelectric operations and coordinate with business and government partners to manage extreme weather events.