Shareholder representative As You Sow filed shareholder proposals at four of the largest US gas and electric utilities, Dominion Energy, DTE Energy, Duke Energy, and Southern Company, raising concerns about the companies’ continued investments in natural gas.
Shareholders are concerned that these utilities are claiming “Paris-alignment” while remaining on a path toward stranded asset risk.
Natural gas is a potent greenhouse gas (GHG) with 84 times the climate impact of carbon dioxide. The natural gas supply chain leaks alarming amounts of methane upstream — 60% more than previously estimated by the U.S. Environmental Protection Agency — creating, not preventing, climate risk. Significant emissions also occur downstream, when gas is burned in buildings for heating and cooking.
Lila Holzman, energy programme manager for As You Sow, said: “While all four utilities appropriately have net-zero GHG emissions targets, the targets ignore supply chain emissions, dramatically undercounting total greenhouse gas emissions.
“Continuing to invest in natural gas infrastructure is not a solution. If these four utilities accounted for the full range of greenhouse gas emissions associated with natural gas, they would likely be heading more rapidly toward investments in electrification, renewables, storage, and other low-carbon technologies.
“As it stands, current ‘net-zero’ plans appear to rely heavily on fossil gas and fall short of necessary climate goals.”
Electrification, rather than natural gas, has emerged as an increasingly cost-effective solution to achieve net-zero emissions. Already, 40 cities in California and across the country have adopted policies to curtail natural gas in buildings and support building electrification. Recognizing the need to grapple with the challenges of winding down gas assets, California, New York, and Massachusetts have each launched official investigations into the future of gas distribution systems.
Daniel Stewart, a research associate for As You Sow, adds: “Utilities are not adequately planning for reduced use of natural gas in buildings,
“By proactively shifting away from natural gas as the default energy source, and incentivizing low-carbon electrification, utilities can support this promising solution.
“Instead, investors are concerned that utilities like Dominion and DTE are investing billions in fossil fuel infrastructure, which is at risk of being prematurely stranded, when they could be moving toward a zero-emission building future.”
The company’s subsidiary, Southern California Gas (SoCalGas), is the nation’s largest natural gas distribution utility and has been widely criticized for its actions to promote gas use and attempt to slow or stop government regulations to reduce climate emissions, undermining climate goals. To learn more about As You Sow’s work on climate change, click here