ESG Q&A with WEC Energy Group
What is the visibility in achieving your emissions reduction goal(s) and can you provide us with concrete examples of how you plan to get there?
As part of our plans to reduce emissions we’ve announced plans to exit coal generation by 2035 and the retirement of 1,800 megawatts of older, less efficient fossil-fueled generation by 2025. That is on top of the 1,800 megawatts of coal-fueled generation we retired between 2018 and 2019.
We have also announced plan to invest $3.5 billion in new renewable generation by 2026. A number of these projects have already been proposed and are being considered by regulators.
We have published 2 climate reports, in conformity with TCFD, over the past 3 years, with another forthcoming in April. 2022.
You have a net zero by 2050 goal, but what are your interim milestones? What are the KPI’s we can track to monitor your progress?
We have a goal to make our electric generation fleet net carbon neutral by 2050 and reduce carbon dioxide emissions 60% by 2025 and 80% by the end of 2030, compared to 2005 levels. These goals are among the most ambitious near-term goals in the industry. We also plan to achieve net-zero methane emissions from our natural gas distribution system by the end of 2030 and eliminate coal as an energy source by 2035.
We track greenhouse gas emissions from electricity generation and purchases and other air emissions from electricity generation and we report the results in our Corporate Responsibility Report
Is your company’s non-financial reporting treated with the same rigour (standards, auditing etc.) as financial reporting?
In addition to engaging directly with our stakeholders, we report on sustainability-related topics in a number of ways. We have published our annual corporate responsibility report for the past two decades, and our climate report presents our climate-related governance and strategy in more detail.
We routinely respond to data verification and survey requests from third-party organizations, and we have disclosed information on our operations and climate-related risks and opportunities to CDP (formerly the Carbon Disclosure Project) for over a decade.
We also are participating in initiatives led by Edison Electric Institute and American Gas Association to promote consistency and transparency in sustainability reporting across the energy utility sector.
Do you think the reporting and management of scope 3 emissions (upstream and downstream) is becoming an inevitable reality for global listed infrastructure companies? If so, what is your company’s plan to manage them?
Our current carbon and methane emissions goals include only Scope 1 emissions, however we are currently evaluating opportunities for setting Scope 3 emissions goals.
In support of our environmental policy, we seek to enhance the sensitive natural habitats on our companies’ properties, using sound practices to manage for multiple uses — aesthetics, biodiversity, cultural resources, forestry, recreation, water quality and wildlife.
We support stewardship efforts that reach beyond properties and across state borders. Some electric and natural gas facilities are located in protected, potentially sensitive habitats such as wetlands, grasslands, savannas and forests. When we design, maintain or upgrade facilities, environmental staff members work with project teams to avoid sensitive areas whenever possible. We also seek to protect the surrounding environment and minimize potential impacts to ecological and cultural resources.
Our companies collaborate with local, state and federal agencies during the regulatory review of our projects. Appropriate stakeholders are brought together to achieve stewardship goals through opportunities typically identified during project planning and execution of construction projects. Beneficial biodiversity and resource protection outcomes result from meeting or exceeding state and federal guidelines and regulations.
Our staff members lead several comprehensive wildlife restoration and protection efforts with the coordination and cooperation of various state and federal agencies and multiple partners. Priority goes to species and native ecosystems in the greatest need of protection, recovery and enhancement.
Each year, state database information is reviewed for thousands of projects to ensure that our construction activities do not negatively impact natural resources (e.g., wetlands, waterways or rare species) or cultural resource sites. Our employees work to avoid or minimize impacts to these resources. Careful planning and implementation during electric distribution and natural gas lateral pipeline projects have increased biodiversity through wetland and rare species habitat restoration following construction. The planning process also targets reducing effects from habitat fragmentation and affecting high-quality resources. When necessary, site surveys and construction monitoring are conducted by archeological professionals to protect the integrity of known cultural resource sites.
Through robust training programs and internal outreach, our Environmental department informs and educates thousands of company employees and contractors on environmental protection and stewardship, and managing erosion during construction projects. Through these programs, employees and contractors carry out activities that serve to enhance natural resources, protect and improve habitat, and increase biodiversity across our service areas.
Strict adherence to company procedures and state regulations for controlling sediment runoff from construction activities is enforced on thousands of miles of maintenance and construction projects annually. Company crews and contractors implement stringent best management practices to manage erosion and keep disturbed sediments contained within planned construction areas. Compliance monitoring occurs frequently to ensure these practices are followed to significantly minimize impacts to natural resources they are intended to protect.
Our companies also seek to work with the general public to increase awareness of natural resource stewardship.
Some companies are resetting DE&I goals. How have the goals changed, and how are they measured? What operational changes have been made to support achieving the new goals? How are management and Board engaged in DE&I?
We have extremely robust internal and external reporting on our DE&I. Both our board of directors and management team ae fully engaged in these initiatives and our progress, which is linked to compensation incentive measures. We are dedicated to ensuring a diverse workforce and inclusive workplace. Our commitment to diversity and inclusion is more than following policies and procedures; it is a core strategic competency. We have a long history of valuing diversity as an integral part of our corporate culture that is recognized in our annual Top 10 goals. Making sure our workplace is inclusive and respectful means employees can bring their best and do their best. We value diversity and inclusion as an opportunity to strengthen our company’s success. We are committed to maximizing both individual contributions and organizational effectiveness through the diversity of our workforce.
This commitment reflects our strong determination to be a high-performance, pluralistic organization with a sustained competitive advantage in the global energy marketplace as we provide safe, reliable service and the best customer care.
We encourage diverse workforce development by fostering inclusion and equal opportunity. Diversity and inclusion are values and strengths that drive success and help us realize our full potential and business goals. A number of initiatives promote diverse workforce contributions, educate employees about diversity and inclusion and make our companies attractive employers for persons of diverse backgrounds. These include company support for a variety of development opportunities, such as programs for current leaders, an Emerging Leaders program that helps employees in nonsupervisory roles develop their leadership skills, and newly created webinars to educate employees and leaders regarding the company’s individual development plan process. We also support external programs such as Mount Mary University’s Women’s Leadership Institute, African American Leadership Program, McKinsey’s Black Academy, and Chicago United Corporate Inclusion Institute.
With a focus on inclusion, we promote business resource groups with executive sponsorship. The company has eight active and engaged groups: African American Business Resource Group, Asian Americans and Friends, Listo!+, Management Development Network, Military Service Members Association, Next Generation Network, WEC PROUD (LGBT+) and Women’s Development Network. These groups foster an atmosphere of inclusion and engage our employees in using their talents and interests to spark innovation and support our strategic goals. Each group helps strengthen alignment throughout our companies and our communities. They provide opportunities for networking, career and leadership development, and community engagement. Our business resource groups also serve as an avenue for feedback to the company on key opportunities and a means of providing diverse insights into promoting and further advancing the company’s business. For example, the business resource groups partnered with their executive sponsors and hosted a variety of virtual sessions throughout 2020, focusing on relevant topics such as partnering with the company’s Employee Assistance Program administrator to address stresses due to social unrest and racial inequity. Business resource groups also provided opportunities for sharing and learning, along with other sessions focused on mental health and inclusion. In addition, each group helps attract, develop and retain talent.
We are also an active member of the Wisconsin Energy Workforce Consortium (WEWC), a nonprofit group of electric, natural gas and nuclear utilities and their associations. WEWC teams up with secondary and post-secondary educational institutions and the workforce system to create workable solutions to address the need for a qualified, diverse workforce. Our involvement includes participation on the Educate, Outreach and Grow taskforce subcommittees.
Other efforts include executive and informal mentoring programs and inclusion training, such as training for leaders on countering unconscious bias, building inclusive teams, creating inclusive environments and preventing workplace harassment. In 2020, we intensified our focus on providing diversity and inclusion resources for employees via our business resource groups and our company’s intranet site. We again participated in a survey on women in the workplace, which encourages female leadership and gender equality. Women filled 24% of all leadership positions at our company as of Dec. 31, 2020. In addition, in partnership with the Metropolitan Milwaukee Association of Commerce, our company is supporting the Making Milwaukee a Region of Choice pledge to increase African American and Hispanic/Latino management and employment in Metro Milwaukee by 2025. We also support Edison Electric Institute’s 2020 Commitment to Diversity, Equity and Inclusion.
Does your company actively monitor (at the Board and executive level) any gender pay gaps in like-for like positions? What is your strategy for addressing any gaps?
We comply with all governing employment laws and also participate in regular audits of our employment practices, which include a review of the total compensation paid to all employees. Additionally, we systematically analyze pay equity among employees, including a review of gender, race and ethnicity issues.