RAEL teams up with Climate Earth Inc. to cut PG&E's emissions

June, 2010

PG&E Takes Aim at Supply-Chain Emissions

 Shrinking your carbon footprint isn’t as simple as cutting your direct greenhouse gas (GHG) emissions—whether from your car or your fireplace. It’s also a matter of watching what you buy, so you don’t embed hidden emissions in your purchases.

Credit: Nick Saltmarsh

The same principle holds for companies. As the largest California utility, with a $4 billion annual purchasing budget, PG&E can have a big impact on GHG emissions through its procurement decisions. But making informed choices, in an economy that does not (yet) price carbon emissions, is no easy task.

In an effort to reduce the company’s environmental footprint, PG&E is teaming up with researchers at University of California, Berkeley and Climate Earth Inc., an environmental accounting company in San Francisco, to research the carbon footprint of products and services the utility buys. 

The project will use a technique called life cycle assessment to better understand supply-chain GHG impacts and to identify promising opportunities for GHG reductions. The results of this study will help PG&E and its suppliers cooperate to develop targeted climate action plans to reduce emissions throughout the supply chain.

"This innovative effort, linking academia, the utility and the private sector, is an important learning opportunity that can build the sort of green accounting
business model we need for the 21st Century," said Dan Kammen, lead researcher on the project and professor with UC Berkeley's Energy and Resources Group.

The Climate Earth carbon accounting software will enable PG&E to track its complete supply-chain carbon footprint over time by dynamically integrating carbon metrics with data on company expenditures.

“We’re proud to help PG&E enter a new frontier in environmental leadership,” said Chris Erickson, CEO of Climate Earth Inc, “Climate Earth’s system will be used to quantify all of the company’s supply chain carbon emissions, something that has never been done for a utility. It will be exciting to discover ways in which PG&E’s procurement can be a powerful force for minimizing environmental impacts.”

UC Berkeley and Climate Earth researchers will customize the results based on detailed product information gleaned throughout the project. The lifecycle methodology used will be consistent with global protocols for measuring supply-chain GHG emissions, as developed by the World Resources Institute and the World Business Council for Sustainable Development.

“The project holds substantial potential to encourage clean technology development in California,” said Steve Kline, vice president of corporate environmental and federal affairs and chief sustainability officer for PG&E. “In addition to helping to reduce the GHG footprint of our suppliers, we hope this effort will provide an example to other companies interested in taking voluntary action to reduce their climate impact.”