PG&E Net Zero Emissions Pledge by 2040, Reveals “Scope 4” Emissions

The U.S.’s largest utility, Pacific Gas and Electric (PG&E), revealed its multi-decade pledge that aims to rapidly reduce its GHG emissions and reach net zero by 2040 while still using natural gas to produce power.

PG&E net zero pledge is five years earlier than the goal of its home state of California.

The utility’s climate strategy also calls for more ambitious interim 2030 goals and long-term targets. At a glance, here’s how the company commits itself to heal the planet:

A climate- and nature-positive energy system by 2050
A net zero energy system in 2040
A series of 2030 climate goals to reduce PG&E’s operational carbon footprint and enable customers and communities to reduce their carbon footprints:

Reduce Scope 1 and 2 emissions by 50% from 2015 levels
Reduce Scope 3 emissions by 25% from 2015 levels
Achieve “Scope 4” goals to enable customer emission reductions

PG&E Net Zero Pledge: 2030 Climate Goals

With 16 million customers across California, PG&E supplies more people than any other utility in the country. Its climate goals are among the most ambitious laid out by major investor-owned utilities.

And that’s partly because the state already has set bold clean energy laws. It requires utilities to get 100% of electric power from non-carbon sources by 2045, for instance.

PG&E is deploying various strategies to reduce its Scope 1 and 2 emissions by 50% from 2015 levels. Its strategy is to reduce emissions from the energy delivered through its wires and pipelines while increasing electrification technologies and value for its customers.

The following table enumerates the climate strategies that the firm is doing.

Scope 1 represents direct emissions from PG&E’s operations. While Scope 2 refers to indirect emissions from facility electricity use and electric line losses.

PG&E expects its output of natural gas will go down by 40% by 2030 compared to 2015 levels. Still, the utility will keep its three gas-fired power plants in operation.

When it comes to its Scope 3 and 4 emissions, the firm is taking a strategic, collaborative approach to reduce them both.

“Scope 4” emissions is an emerging term for categorizing emission reduction enabled by the company.

PG&E Scope 4 goal to enable further emission reductions and support the state’s climate goals is through:

Offering energy efficiency and electrification programs

Unleashing the full potential of electric vehicles and

Converting industrial and large customers from high carbon-intensity fuels to natural gas

The utility firm sets the following targets for its Scopes 3 and 4 interim net zero pledge.

PG&E Climate Strategy and Carbon Credits

PG&E supports and takes part in the California Climate Credit. It’s from a state government program that requires power plants and natural gas providers that emit GHG to buy carbon permits from auctions managed by the California Air Resources Board (CARB).

The program is part of California’s cap-and-trade program. It encourages major utility providers like PG&E to shift toward clean sources of energy. These include solar, wind, geothermal, hydro, and other renewable resources.

When the utility firm sells electricity and natural gas to customers, it pays the pollution permits (credits) associated with customer burning of its fuels and passes the costs on through customers’ bills.

This permit to pollute says that when firms went over their allowed (cap) emissions, they’ll pay a fee for every metric ton of carbon above what they’re allowed to emit.

The pollution costs appear in all customers’ utility bills, more so in the part of electricity bills that represents the costs to generate electricity.

The climate credit program is expected to continue through 2030, the same period when PG&E seeks to achieve its interim climate targets.

PG&E net zero pledge involves Scope 4 efforts that associate with the climate credit program. The company can make a significant contribution by enabling Scope 4 emission reductions. This is through customer energy efficiency and electrification measures.

2040 and 2050: Net Zero Emissions and Climate-Positive Energy Future

Building upon its 2030 climate goals, PG&E will work to achieve net zero emissions by 2040 by eliminating or reducing emissions and then removing the remaining carbon from the air. By 2050, the utility firm plans to remove more GHG than it emits.

PG&E is uniquely positioned to lead the energy transition with customers at the center as being a dual commodity utility provider. To make this happen, the company will use a diverse mix of resources:

Broad electrification
Cleaner fuels ex. renewable natural gas and hydrogen
Nature-based solutions
Carbon capture, storage, and utilization

With this, PG&E aims to evolve the gas system to be an affordable, safe, and reliable net zero energy delivery platform.

Last year the utility got about 50% of its electricity from renewable sources like solar and wind. Another 39% came from the Diablo Canyon Nuclear Power Plant, which is set to shut down in 2025.

To make up for that lost power, the utility is investing in more battery storage so it can save excess solar power produced during the day for use at night.

PG&E CEO, Patti Poppe said about the utility’s net zero pledge in its climate strategy report:

“At first glance, meeting these milestones may look to be an extraordinary challenge. But extraordinary times call for extraordinary measures… We need to put the climate machine into reverse and begin undoing the damage. This [climate] report represents PG&E’s bold plan to do just.”

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