Verizon Communications Inc.: Feasibility Report on Adoption of Renewable Energy
BE IT RESOLVED: Shareholders request that Verizon Communications, Inc. senior management, with oversight from the Board of Directors, issue a report assessing the feasibility of increasing the scale, rigor, and pace of Verizon’s utilization of renewable energy and other measures deemed prudent by company management to substantially reduce the Company’s greenhouse gas emissions and climate change risks associated with the use of fossil fuel-based energy. The report should be produced at reasonable cost and omit proprietary information.
WHEREAS: In 2015, 196 parties at the UN Climate Change Conference agreed to limit climate change to under an average global warming of 2 degrees Celsius above preindustrial temperatures. In order to mitigate the worst impacts of climate change, the Intergovernmental Panel on Climate Change estimates that net emissions of carbon dioxide must fall 45% by 2030 and reach net zero by 2050 to stabilize global temperatures.
For industries whose greatest source of emissions come from electricity, sourcing renewable energy represents one of the most effective ways to reduce a company’s carbon footprint. According to Verizon, more than 93 percent of the Company’s emissions result from the electricity used to power its networks.
Verizon currently has a commitment to source a total of 44 megawatts of renewable energy above by 2025. According to a widely publicized 2018 report entitled Clean Energy is Calling, this commitment would only cover approximately 4% of Verizon’s total energy use. The rest of the telecommunications industry has embraced increased renewable energy sourcing, potentially leaving laggards with a competitive disadvantage:
T-Mobile has a publicly stated commitment to power its entire operations with renewable energy by 2021. As of March 2018, T-Mobile had reached 60 percent renewables and expects to save approximately $100 million in the next 15 years through its efforts.
In 2018, AT&T announced renewable energy purchases totaling 820 megawatts, covering nearly 20% of the Company’s total energy usage.
Studies have found that man-made climate change is impacting the strength and severity of natural disasters such as hurricanes. Verizon notes in its 2018 10-K that natural disasters “could cause significant damage to our infrastructure upon which our business operations rely, resulting in degradation or disruption of service to our customers.” In October of 2018, Hurricane Michael, the strongest hurricane to ever hit the Florida panhandle, caused “unprecedented damage” to the Company’s fiber cable infrastructure.
Assessing the feasibility of goals for renewable energy procurement and other greenhouse gas reducing measures, while benchmarking industry peers, could serve as a practical step towards aligning business operations with global efforts to limit climate change. This could help insulate our company from regulatory uncertainty, mitigate risk of climate related service disruptions, and position Verizon as a contributor to climate solutions, producing reputational benefits.