Advancing the energy transition
For two decades, Sempra has been on a sustained path to decarbonize our business operations and the markets we serve. We see innovation and new technologies as central to a clean energy future, enabled by investments in three key capabilities: decarbonization, diversification and digitalization, which we refer to as the “3Ds”.
This past year, we summarized our aspirations in each of these areas as part of our energy transition action plan. In 2021, we announced a bold aim to have net-zero GHG emissions by 2050. As an interim operational goal, we aim to reduce Sempra California and Mexico (non-LNG) scope 1 and 2 GHG emissions 50% by 2030 as compared to a 2019 baseline. Read about our operating company goals in Appendix.
These announcements represent a continuation of our longstanding commitment to work to reduce our carbon footprint while providing customers access to affordable and reliable cleaner energy solutions. Read more about how we aim to advance a just energy transition in Social.
In 2021, Sempra released a Sustainable Financing Framework, which outlines the parameters under which we invest in the 3Ds to work toward our net-zero aspirations and advance the energy transition. It establishes criteria for any issuances by Sempra, SDG&E or SoCalGas of sustainable financing instruments and the use of proceeds from such issuances to finance projects aligned with our ESG strategy. Eligible projects may include investments in clean transportation, climate change adaptation, energy efficiency, clean energy solutions, green buildings, pollution prevention and control and socio-economic advancement and empowerment. By aligning our capital-intensive activities with our 3Ds framework and sustainability goals, we believe it will help drive our ESG commitments to support long-term, sustainable value for all.
The 3Ds framework is intended to support our aim to have net-zero emissions by 2050.
In California, SDG&E completed in 2021 its inaugural issuance of $750 million of green bonds and secured regulatory approval for three new utility-owned energy storage projects, expected to total 161 megawatts. Additionally, SoCalGas achieved over 4% RNG deliveries to core customers in 2021.
In Texas, Oncor is connecting customers to cleaner, renewable sources of energy by expanding and modernizing Texas’ vast transmission and distribution network. In 2021, Oncor connected 1,223 MW of renewable generation, bringing the total renewables connected to Oncor’s system to approximately 12,000 MW. In addition to progress on its operations, Oncor also entered into a new $2 billion revolving credit facility with sustainability-linked performance metrics.
At Sempra Infrastructure, the newly consolidated platform is advancing opportunities in renewables, hydrogen, ammonia, LNG and carbon capture infrastructure. The company recently filed an amendment with the Federal Energy Regulatory Commission (FERC) to incorporate electric-driven compression at its proposed Cameron LNG Phase 2 project, which could help reduce facility emissions, while continuing to help decarbonize global markets. Earlier this year, the company also announced a non-binding memorandum of understanding (MOU) with Entergy Louisiana, LLC to cooperate on the development of options intended to accelerate deployment of renewable energy to power primarily LNG facilities. Across our industry, companies are adjusting their business models to meet customer demands for increasingly cleaner sources of energy. At Sempra, we think these trends play to the strength of our company and effectively create a tailwind for new and cleaner investments across our platforms.
- Announced three energy storage projects (10, 20 and 131 MWs) for nearly $400 million capital investment
- Proposed Angeles Link, which could be the nation’s largest green hydrogen energy infrastructure system, including the possibility to displace up to 3 million gallons of diesel a day by replacing diesel powered heavy-duty trucks with hydrogen fuel cell trucks, and eliminate nearly 25,000 tons of smog forming NOx per year
- Supported the interconnection of six RNG projects onto the SoCalGas system
- Achieved 4% RNG deliveries to core customers as defined in SoCalGas’ tariff rule no. 23
- SDG&E and Sumitomo Electric completed zero-emissions microgrid pilot using vanadium redox flow battery
- Received regulatory authorization to offer Voluntary Renewable Natural Gas Tariff
- Received state approval for Senate Bill 1440 renewable gas standard implementation
- Completed initial testing of electrochemical hydrogen separation and compression technology demonstration
- Broke ground on H2 Hydrogen Home construction
- Continued to transition towards ZEV fleet with delivery of 23 light duty hydrogen fuel cell electric vehicles
- Established ongoing demonstrations with H2 blending into gas system and appliance performance testing
- Continued investment in SDG&E’s wildfire prevention and mitigation measures, including the integration of an artificial intelligence (AI) forecasting system across 190 of its 221 weather stations in 2021
- Invested $12 million in becoming the first utility to deploy state-of-the-art laser technology to detect, pinpoint and quantify methane emissions in SoCalGas distribution area
- Launched $285 million Envision program at SDG&E to modernize its customer service and information capabilities
- SoCalGas launched hydrogen drone partnership with Doosan and GTI to enhance pipeline system imagery and video for difficult to access or hazardous locations with performance of 120-minute flight time
- In 2022, SoCalGas expects to begin implementation of vehicle telematics in fleet vehicles designed to understand vehicle utilization patterns, emissions profile and performance and to assess improvement opportunities
- Connected 1.2 GW of wind and solar generation, with plans to connect nearly 13 GW of renewables by 2025
- Established a five-year program to expand voltage reduction capabilities to substation transformers with a load tap changer, with potential to enable this capability at more than 100 additional locations in 2022, which, if completed, has potential to reduce demand by approximately 500 MW during peak load conditions
- Established processes in response to winter storm Uri to more efficiently rotate customer outages while maintaining service to critical loads and underfrequency load shed feeders, in order to help increase customer equity and reduce reliability risks
- Established a goal to invest $700 million over 10 years in smart-grid technology designed to prevent potential overloads and outages before they happen
- Collaborated with the National Renewable Energy Laboratory and other utilities to examine opportunity for electrification of heavy-duty trucks and semi-trucks
- Added 26 new wind turbines in Phase 2 of the Energia Sierra Juarez wind farm in Tecate, Baja California, a $150 million investment
- Filed an amendment with FERC to incorporate e-drives at proposed Cameron LNG Phase 2 facility
- Entered into non-binding MOU with Entergy Louisiana, LLC to cooperate on the development of options to accelerate the deployment of renewable energy to Sempra Infrastructure’s facilities
- Worked with the World Bank Group to develop the Volta de Mexicali Battery Energy Storage System facility in Mexicali, Mexico
- Proposed carbon capture utilization and sequestration project in Hackberry, Louisiana, that would allow Cameron LNG to achieve scope 1 CO2 emissions reductions
- Signed a non-binding MOU with Mexico’s Federal Electricity Commission to work to develop critical new energy infrastructure in Mexico, including the proposed Vista Pacífico LNG project
- Combined platform strengths of LNG and net-zero solutions, clean power, energy networks to create large-scale new opportunities
- Continued to advance world-class, integrated digital systems to deliver efficient development, construction and operations
- Embarked on digital/AI strategy designed to increase production, reduce emissions and reduce operations and maintenance costs at Cameron LNG
- Certain ring-fencing measures limit our ability to direct the management or activities of Oncor. As a result, Oncor sets its own ESG goals and unless specifically indicated, enterprise goals and activities do not include Oncor.