Utilities Respond to Electrification Risks — Shareholders Withdraw Proposals at Dominion and DTE Energy
FOR IMMEDIATE RELEASE
MEDIA CONTACT: Stefanie Spear, [email protected], 216-387-1609
BERKELEY, CA—MARCH 19, 2021—Shareholder representative As You Sow recently withdrew shareholder proposals at two large U.S. gas and electric utilities, Dominion Energy and DTE Energy. The first-time proposals asked the utilities to address building electrification — instead of natural gas distribution — as a means to decarbonize in line with the Paris Climate Agreement.
Natural gas, is a fossil fuel that creates climate impacts across its supply chain through combustion emissions and leakage of methane, a potent greenhouse gas with 84 times the climate impact of carbon dioxide. Commercial and residential buildings account for 12.3% of greenhouse gas (GHG) emissions nationwide, mainly due to gas combustion for heating and cooking. Electrification has emerged as an increasingly cost-effective solution to achieve net-zero emissions. Already, more than 40 cities in California and across the country have adopted policies to curtail natural gas in buildings and support building electrification.
“As experts align to advocate to ‘electrify everything’ to decarbonize our buildings, utilities and investors must be proactive or risk stranded assets and loss of value,” said Lila Holzman, senior energy program manager of As You Sow.
As electrification becomes more cost-competitive and policies gain traction, most utilities face a challenging transition. Last year, Dominion cancelled a costly, high-profile gas project — the Atlantic Coast Pipeline—exemplifying the risks of pursuing investments misaligned with the clean energy transition.
“Investors need clear information on utility plans responsive to electrification efforts and whether utilities are supporting or fighting policies that would accelerate electrification,” said Daniel Stewart, senior research associate at As You Sow. “Continuing to invest in natural gas infrastructure is not a solution. Utilities like DTE have the opportunity to show leadership by supporting electrification solutions.”
Recently, multiple utilities and the trade group American Gas Association (AGA) have fostered preemption laws in a number of states to prevent cities from passing laws that support electrification or require reduction or elimination of gas in new buildings, a key step to economically achieve climate goals. Anti-climate lobbying practices to protect emission-heavy business practices is a regressive trend and counter to utility claims of supporting the goals of the Paris Agreement.
In response to agreements from Dominion and DTE to increase disclosures to shareholders about electrification risks and opportunities, shareholder As You Sow withdrew its proposals with each company.
As You Sow along with other shareholders have filed a resolution with California utility Sempra Energy on its climate-related lobbying practices. 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 over electrification and attempt to slow or stop regulations aimed to reduce climate emissions, undermining climate goals. That resolution is slated to be voted on by shareholders at Sempra’s annual general meeting this spring.
To learn more about As You Sow’s work on climate change, click here.
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As You Sow is a nonprofit organization that promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies. See our resolutions here.