Investors Support Net Zero Plans for Southern Company’s Natural Gas Business
FOR IMMEDIATE RELEASE
MEDIA CONTACT: Stefanie Spear, [email protected], 216-387-1609
BERKELEY, CALIFORNIA—MAY. 24, 2023—Today at the annual general meeting of power and gas utility Southern Company announced that 20% of investors voted in favor of a shareholder resolution filed by As You Sow, based on a preliminary vote count. The resolution asks the company to set a net zero target for emissions from its value chain, including its sale of natural gas. In April of this year, 18.3% voted in favor of a similar resolution filed at CenterPoint Energy.
The resolutions ask Southern and CenterPoint to take responsibility for the greenhouse gas emissions from producing natural gas and coal, the burning of gas sold to customers, and purchased power from the grid. Collectively, these sources of emissions account for approximately 30% of Southern’s and 80% of CenterPoint’s total greenhouse gas emissions.
Utilities with gas distribution businesses like Southern and CenterPoint are exposed to significant risk of disruption as customer use of gas for heat, and cooking is increasingly seen as the next frontier for net zero decarbonization.
“Southern and CenterPoint will benefit from stepping up their ambition in proactively reducing emissions reduction from their gas distribution business to match the progress they are making in their power business,” said Daniel Stewart, energy and climate program manager at As You Sow. “Without quantitative and time-bound, science-aligned targets, Southern and Centerpoint will be unprepared for the growing disruption facing the gas utility industry. Such unpreparedness increases the risk of misinformed strategy, insufficient innovation, and misdirected capital expenditure on technologies that cannot scale at the level needed to achieve net zero emissions. A net zero target is the first step in addressing the climate risk they face.”
“The power generation sector has already experienced disruption due to innovation and the improved economics of zero-emission technologies such as solar, wind, and battery storage,” said Stewart. “The building sector is facing a similar disruptive transition from highly efficient technologies such as air-source heat pumps.” A global surge in the popularity of heat pumps is occurring, with growth rates increasing 35% in more developed economies like the EU and 13% globally from last year. There is also significant regulation and policy being rolled out in support of these zero-emission technologies. Across the U.S., 100 cities and counties have adopted policies that require or encourage all-electric homes and buildings. As of December 2022, nearly 31 million people across nine states and Washington D.C. live in a jurisdiction where such policies have been introduced.
U.S. energy utility peers are increasingly taking steps to address material climate-related risk. Duke, Dominion, Sempra, Xcel, and CMS have all announced the expansion of their net zero emission reduction targets to include the sale of natural gas to customers from their gas distribution businesses.
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As You Sow is the nation’s leading shareholder representative, with a 30-year track record promoting environmental and social corporate responsibility and advancing values-aligned investing. Its work includes climate change, ocean plastics, pesticides, racial justice, workplace diversity, and executive compensation. Click here for As You Sow’s shareholder resolution tracker.