We depend on suppliers for equipment, parts and services essential to project planning, construction, operations and system reliability. Our supplier code of conduct details our expectations for suppliers to evaluate their operations, products and services from a total lifecycle perspective in order to propose and implement effective policies and measurable improvements.
Climate risks and opportunities have influenced our strategy related to supply chain in several ways. First, to advance decarbonization, reliability and retail choice, we continue to evolve our electric procurement strategy at SDG&E to meet decarbonization, reliability and affordability needs with renewable and firm sources of electricity and storage. On the natural gas side, we have set a goal that by 2030, 20% of the gas that we deliver to SoCalGas core customers will be from renewable natural gas that is captured and repurposed from the decomposition of organic matter (with an interim goal of 5% by the end of 2022), which is key to advance decarbonized circular solutions in the local economy and also to meet California Senate Bill 1383’s goals for organics diversion from landfills and reduction of short-lived climate pollutants. We are also engaging in the market to develop RNG from sources such as dairy farms, landfills and wastewater treatment plants.
On the LNG side, Sempra Infrastructure actively works with companies and institutions across the LNG supply chain to help reduce scope 2 and 3 emissions. Earlier this year, Sempra announced it had entered into a memorandum of understanding (MOU) with Entergy Louisiana, LLC to develop options designed to accelerate the deployment of renewable energy to power Sempra Infrastructure’s facilities in the state of Louisiana.
Sempra recognizes the critical role suppliers play in our operations and supports SDG&E and SoCalGas’ visions of developing supply chain sustainability programs on the leading edge in the industry that include short-term, mid-range and long-term goals, some with target completion dates by 2025. Specifically, by 2025 SDG&E aims to develop a supply chain sustainability program. To demonstrate this commitment to creating a more sustainable supply chain, SDG&E and SoCalGas are both developing independent tangible and actionable roadmaps with measurable milestones and working with suppliers and partners throughout the supply chain on continuous and sustainable improvement.
This approach strengthens both companies’ long-term supply chain strategy and includes:
- Integrating social responsibility, environmental stewardship, financial and governance aspects into decision-making throughout the supply chain to improve long-term performance and reduce risk;
- Partnering with SDG&E’s and SoCalGas’ suppliers and partners to reach the companies’ supplier diversity and sustainability goals through outreach, education and shared resources;
- Participating in industry groups focused on supply chain sustainability and shared best practices, including the Electric Utility Industry Sustainable Supply Chain Alliance;
- Conducting annual sustainability assessments to engage SDG&E’s and SoCalGas’ suppliers and better refine the company’s scope 3 GHG emissions;
- Engaging outside consultants to periodically benchmark SDG&E’s and SoCalGas’ supply chain sustainability program strategy and reassess the companies’ supply chain material issues; and
- Integrating investment recovery into a sustainable supply chain.
Sempra recognizes the critical role suppliers play in our operations and supports SDG&E and SoCalGas’ visions of developing supply chain sustainability programs on the leading edge in the industry that include short-term, mid-range and long-term goals, some with target completion dates by 2025.