Supply chain responsibility

Across our supply chain, PG&E aims to promote environmental sustainability, excellence, economic growth, and ethical practices.  Collectively, this approach supports our commitment to deliver for our hometowns.

Our approach

Since 2007, PG&E has helped suppliers reduce the environmental impact of the products and services we purchase.  For nearly 45 years, we have also been working to promote a diverse supply chain and continue to make an economic impact by contributing to job creation, tax generation, and revenue.

Our 6,100-plus direct suppliers represent industries such as construction, professional services, vegetation management, and manufacturing, comprising $11.5 billion in 2024 spend. Approximately 72% of PG&E’s direct suppliers are located in California and PG&E spent about $7.37 billion with California suppliers in 2024. 

Environmental sustainability

We actively engage with our suppliers in support of PG&E’s commitment to achieve a net-zero energy system in 2040. 

We initiated a Greenhouse Gas Reduction Roadmap with our suppliers in the key emitting industries of construction services, vegetation management, and manufacturing, which represent over 60% of PG&E’s non-energy-related Scope 3 emissions from purchased goods and services. The roadmap reflects our plan to have our suppliers report greenhouse gas emissions data and set net zero goals by 2030.

Measuring progress

We use the results of our annual supplier sustainability assessment to benchmark our responding suppliers’ sustainability performance against peers in the Sustainable Supply Chain Alliance. We ask suppliers to complete a self-assessment and provide their most recent environmental performance data for energy and water use, as well as greenhouse gas emissions and waste generation. 

The assessment measures the supplier’s performance and provides detailed benchmarking that is specific to their industry. Additionally, it can help suppliers develop strategies to reduce environmental impacts and prioritize improvement opportunities. For suppliers that completed the assessment, 50% indicated they were using science-based or net-zero targets, exceeding our goal of 30%. 

Percentage of assessed suppliers engaged in reporting emissions and reduction goals

Percentage of suppliers tracking impacts¹

1. In 2024, we requested sustainability assessment responses from 297 suppliers and achieved a 44% response rate, which represented 47% of PG&E’s 2023 spending. 

Supplier diversity

We are focused on fueling long-term, economic prosperity across PG&E’s service area by promoting a competitive and comprehensive supply base.  A diverse supply chain fuels competition, promotes innovation, and powers progress. 

Our focus areas include:

• Targeted outreach through benchmarking, leveraging the talent of incumbent suppliers, and accessing existing networks to create a more robust supply chain.
• Supplier development by providing the tools, resources, and guidance to enhance supplier performance, minimize risks, and promote safety.
• Cross functional collaboration by working effectively with PG&E’s procurement, materials, supplier quality, and other functional areas to optimize our supply chain.
• Reporting to ensure that supplier metrics are part of visual management and aid in identifying gaps and opportunities for increased supplier participation.  
• Supplier diversification to ensure a diverse mix of suppliers that reflects the communities we serve to meet critical needs in every procurement category to reduce disruptions.
• Technical assistance through training, scholarships, and support outreach aimed at helping suppliers improve their business operations and removing barriers to entry.

Measuring progress

1. Results provided are based on a federally mandated methodology and represent spend in the government fiscal year of October 1 – September 30.  

Ethical supply chain

Our Supplier Code of Conduct (Code) sets PG&E’s expectations for our suppliers regarding ethical business practices, conduct, and compliance with applicable laws, regulations, and PG&E policies. This includes promoting and ensuring a strong safety culture and reporting concerns. Suppliers are expected to understand and acknowledge their obligations and maintain conformance to the Code.

We conduct supplier training and perform periodic audits to check supplier conformance to the Code. Suppliers new to PG&E are expected, prior to contracting, to confirm that they will comply with the obligations outlined in the Code and that they have a process to share the Code with individuals assigned to the work. The training and verifications we conduct help to ensure awareness and drive conformance to the Code.

In 2024, we modified our supplier gift and meal standards, began requiring targeted annual supplier reporting of greenhouse gas emissions data and goals, and established strict pre-approval criteria for the use of artificial intelligence (AI) or generative AI products.