Transparency, Action, and Progress

2021 Environmental, Social, and Governance Report

This is UGI Corporation’s (“UGI”) fourth Environmental, Social and Governance (“ESG”) report. The report covers ESG information from our four business segments. It provides information at the business level and, where appropriate, on a fully consolidated basis.

The theme for this report is “Transparency, Action, and Progress.”

In this report, UGI will build upon prior reports and highlight progress across a number of key environmental, social, and governance issues. We remain committed to openly communicating our goals and progress as we continue to evolve and enhance our ESG reporting and strengthen our position as a sustainable organization.

UGI is well positioned to become a leader in the future of renewable energy and continues to focus on reducing our emissions, reducing our customers’ emissions, and investing in alternative energy solutions. UGI remains committed to delivering affordable, efficient, and socially responsible energy products and services to our customers in a safe and reliable manner.

To meet these commitments, UGI is focused on acting in a sustainable and socially responsible manner to minimize our impact on the environment and be a good steward to the planet. In this report, UGI provides performance data related to our ESG commitments.

Our goal is to use ESG data to supplement our financial statements and other public disclosures in order to meet our constituents’ broader need for information. To help with this process, UGI is working toward disclosure of material ESG factors. Last year we completed our first Carbon Disclosure Project (“CDP”) questionnaire and intend to release our first Task Force on Climate-Related Financial Disclosures (“TCFD”) aligned climate report in Fiscal 2023. We also completed our second materiality assessment to ensure we are focusing our attention on the most relevant issues to both our business and stakeholders.

We continue to build data collection protocols and reporting platforms across our business portfolio to supplement our disclosures over time. Information in this report covers UGI’s 2021 Fiscal Year (October 1, 2020 to September 30, 2021) unless otherwise indicated. In addition, we will provide periodic updates on our ESG performance through our website.

From the CEO

I am excited to introduce our fourth ESG report titled “Transparency, Action, and Progress,” or as we are calling it, the TAP Model. We have spent the past few years navigating the evolving expectations of our stakeholders and determined that an ESG program rooted in transparent dialogue, action on material focus areas, and clearly communicated progress is a quality approach. I am proud to report that our leadership team, Board of Directors, and employees are aligned and committed to delivering on the TAP Model and continuing to strengthen our foundation as a sustainable enterprise. Throughout this report we provide numerous examples of the progress we have made during our ESG journey.

As reflected in our prior report, our business and the communities we serve faced challenging economic and social obstacles in 2021. We are still dealing with the lingering effects of the COVID-19 pandemic, racial injustice, food insecurity, data security, the impact of carbon emissions on our planet, and most recently, the military conflict in Ukraine. The military conflict has impacted the lives of many of UGI International’s employees in profound ways. Refugees have poured into cities where UGI operates, but I am proud to report that our people are stepping up to address the humanitarian crisis while still ensuring that our customers have safe and reliable service. The past few years have been a stark reminder that our core values set a cultural foundation that extends far beyond the workplace, and I am proud that UGI’s employees have performed admirably in the workplace and in the communities we serve.

Fiscal 2021 was an exciting year for UGI. We progressed on our commitments to stakeholders and, notably, received recognition for enhancing our ESG program. MSCI upgraded UGI’s ESG Rating Assessment to AA, which places UGI among the leading companies worldwide for action across ESG matters. We are pleased with this result and look forward to continued improvement as we strengthen our foundation.

Lastly, when we think about our people, both the communities we serve and our employees, safety is always of utmost importance to UGI. Every day we strive to improve on this critical aspect of our operations. UGI has invested approximately $70 million over the past 3 years to support this ongoing initiative. Last year we set a goal to sharply reduce our Total Recordable Injury and Accountable Vehicle Incident rates significantly by 2025. In Fiscal 2021, I am proud to report that we have surpassed our goal to reduce AVIs and remain on track to meet our TRI goal.

We continue to evaluate and enhance our ESG reporting framework to ensure that we provide relevant — and useful — data to our stakeholders, and we welcome dialogue around these topics.

On behalf of everyone at UGI Corporation, thank you for your interest in our company.

3-R Strategy Progress

In my first year as CEO, I introduced our 3-R strategy, which encapsulates our vision for the future. UGI is pushing forward to deliver Reliable earnings growth, Rebalancing our portfolio towards natural gas, and increasing our focus on Renewable solutions. Our team delivered significant progress on all three fronts.

Rebalancing and Reliable Progress

In Fiscal 2021, UGI acquired Mountaineer Gas, a local distribution company in West Virginia. This acquisition is a great strategic fit for UGI as it expands our utilities business and enables us to deliver regulated, reliable earnings. Over the past 20 years, UGI Utilities operational fugitive methane emissions have decreased by 90%. We expect to duplicate the template laid out by UGI Utilities to reduce operational fugitive methane emissions by investing in the safety and reliability of the distribution system for our new customers in West Virginia, while delivering excellent customer service. This is an area that we continue to focus on, and I am proud to report that UGI Utilities has been a top performer in a residential customer satisfaction survey for the past 5 years within its utility peer group. We also strengthened our footprint in the Marcellus Shale by acquiring Stonehenge Appalachia, LLC and an equity interest in the Pine Run Midstream system. The expansion of our midstream network is an important part of our strategy as it provides our business with stable, growing cash flows that are underpinned by long term contracts and minimum volume commitments.


Turning to renewables, I am pleased to report not only our exceptional progress, but also our advancement of innovative solutions that fit perfectly with our base business. Our mission is to be the preeminent energy distribution company in our targeted markets by providing a superior range of clean and sustainable energy solutions to our customers. This is an opportunity for our industry, and our strategic asset network and proven competencies allow us to rapidly address growing customer demand while remaining conscious of the important concerns facing the world – providing energy solutions that are sustainable, reliable, and affordable. Our physical connection to over 3 million customers and large field of dedicated service personnel remain key strategic advantages as we continue to invest in renewable solutions.

Over the past 22 months our team invested approximately $130 million in renewable natural gas assets that will lead to the production of 1.3 billion cubic feet of renewable natural gas (“RNG”) annually. Our joint venture with SHV and partnership agreement with Vertimass will accelerate renewable solutions for the LPG industry and will produce over 1 billion gallons of low carbon renewable fuels annually. This rapid growth of our renewable portfolio is a testament to the hard work and dedication of our most important stakeholder – our people.