More than one-third of the electricity generated in 2014 in the United States came from coal.1
When measuring the carbon emissions per dollar of revenue (carbon intensity) for investments, utilities are by far the most carbon-intensive investments in a total market portfolio.2 Not only do power plants have a huge carbon footprint as consumers of fossil fuels, but they also emit other dangerous air pollutants such as nitrogen oxides and sulfur dioxide.
One approach to investing in utilities with a focus on environmental sustainability is to use carbon intensity as a metric in identifying the utilities that are the most efficient producers of energy relative to their environmental impact.
PG&E Corp. (short for Pacific Gas and Electric Company and a holding in Dimensional Fund Advisors’ U.S. sustainability fund) is an example of a utility that passes those criteria with flying colors. In 2014, PG&E produced 27% of its power from renewable sources, which exceeds the 20% average for the state of California’s power mix3 and 7% for the U.S.4
In a benchmarking report released in July 2015, the Natural Resources Defense Council ranked the 100 largest power producers in the U.S. by the amount of electricity produced in 2013. These power producers generated 87 percent of the air pollution emissions attributed to the power generation industry.
PG&E is ranked as the 24th largest producer in the United States. It is one of three power producers in the top 25 to have no generation from coal, and it also has the lowest emission rates (lb/MWh) for carbon dioxide (CO2), nitrogen oxides (NOx) and sulfur dioxide (SO2) among the top 25 power producers in the United States.
Sources
- U.S. Energy Information Administration (EIA) Electricity Data
- Beyond Divestment: Using Low Carbon Indexes—MSCI
- ”PG&E’s 2014 Power Mix”—PG&E
- Benchmarking Air Emissions of the 100 Largest Electric Power Producers in the United States, July 2015—Natural Resources Defense Council
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