In last year’s report, we introduced a number of commitments focused on our people and the planet. This year, we are proud to introduce additional commitments that will help to establish UGI as the foundation of a renewable energy future.
Our Commitments to the Environment
UGI is committed to reducing its Scope I emissions by 55% by 2025 using 2020 as the base year1. We plan to invest approximately $2.5 billion to reduce UGI and customer emissions over this five-year period.
UGI supports the Paris Climate Accord and will work towards carbon neutrality in our operations by 2050. As evolving technology and customer preference drive the future of our industry, we remain focused on delivering impactful change that our stakeholders can monitor in five-year goal sets.
As a distributor of energy products and services, UGI’s activities represent only a small portion of emissions from the natural gas and LPG value chains. In future years, UGI will report on extended scope emissions (upstream and downstream activity) as we convert customers to efficient, renewable, and other low carbon energy solutions. We expect that emissions across the total value chain will decrease, better aligning UGI with the Paris Climate Accord.
UGI will provide broader disclosure on the climate-related risks and opportunities to our business by completing the CDP questionnaire in Fiscal 2021.
Actions to Reduce Scope I Emissions
- Robust Pipeline Replacement & Betterment program
- Sale of non-core assets like Conemaugh
- Converting diesel fuel to renewable or bio-diesel, CNG or LPG
- Investments in leak detection technology
- Capital investment on equipment at compressor stations to decrease emissions
- Ongoing reductions from efficiencies such as route optimization technology
Our Commitments to Our People
In alignment with UGI’s values to promote diversity, the Company recently created the Belonging, Inclusion, Diversity, & Equity (“BIDE”) Initiative. The BIDE Initiative provides the blueprint for achieving greater diversity of gender, race, culture, experience and thought throughout the organization. As part of this initiative, UGI established new partnerships with the Urban Affairs Coalition and Big Brothers Big Sisters, further demonstrating UGI’s commitment to the communities it serves. UGI is also proactively expanding its reach to ensure active consideration of diverse candidates for all leadership positions. In addition, beginning in Fiscal 2021, UGI will include a diversity and inclusion (“D&I”) goal as a component of its executives’ target annual bonus award opportunity.
Health and Safety
Safety is included as a component of the Company’s annual bonus calculation for executives and non-executives, reinforcing our commitment to safety across our organization. In Fiscal 2020, the Company implemented a standalone safety performance goal as part of the Company’s and each of its business units’ annual bonus plans. Safety performance objectives are tied to Occupational Safety and Health Administration (“OSHA”) recordables and comprise ten percent of the annual bonus opportunity.
UGI continues to build on an already strong safety culture. For additional information on our safety performance, please see the “Our People” section of this report. Due to the rapid change that the COVID-19 pandemic had on our work environment and communities, our primary focus in Fiscal 2020 was providing essential services while ensuring the safety of our teams and our 3 million customers. By the conclusion of the second week in March 2020, on a global basis, we had launched our work-from-home plan for our office-based team members and revised critical work practices to drive safe operations for our field based employees and customers.
For ESG purposes, UGI will report on the following two safety goals:
In addition to ongoing community engagements, the onset of COVID-19 caused UGI to think more creatively to ensure we were properly supporting the communities we serve. In April 2020, UGI and its affiliates, UGI Utilities, Inc. and UGI Energy Services, LLC, donated $200,000 to food banks and community funds to assist individuals and families needing food support and other assistance. In May 2020, UGI and its Board of Directors committed to donate more than $350,000 to food banks serving communities across Pennsylvania. UGI’s senior leadership donated the equivalent of 30% of 90 days’ base compensation for the chief executive officer and directors and 20% of base compensation for other senior executives, together with contributions from other officers. The donations were distributed among three food banks including:
- the Central Pennsylvania Food Bank, which serves 27 counties across central Pennsylvania;
- Helping Harvest, which distributes food to more than 300 charitable food program partners in Berks and Schuylkill Counties; and
- Philabundance, which serves the City of Philadelphia and Philadelphia County, as well as the counties of Bucks, Chester, Delaware and Montgomery.
UGI will conduct its second Materiality Assessment in Fiscal 2022 to ensure that we are focusing our disclosure on topics that are most significant to the business.
Progress on Goals Set in 2019 Report
9% reduction in methane intensity at UGI Utilities compared to 2019, and we remain on track to meet 2030 and 2040 goals.
|Establish Methane Reduction Targets||Complete||Established Methane Reduction Targets at our Utilities
business in 2019 ESG Report.
|Establish Scope 1 GHG Emission Reduction Target||Complete||Established new enterprise-wide reduction target of 55% for Scope 1 (direct) GHG emissions over the next five years in the 2020 ESG Report.|
|Enhance Reporting Disclosure Frameworks||In Progress||Introduced Sustainability Accounting Standards Board (“SASB”) reporting for our investors in Fiscal 2020.
Plan to complete CDP disclosure.
|Develop a Human Rights Policy||Complete||Issued an organization-wide Human Rights Policy in Fiscal 2020.
Plan to conduct a Human Rights training for all employees in Fiscal 2021.
|Develop a Supplier Code of Conduct Policy||Complete||Issued an organization-wide Supplier Code of Conduct Policy in Fiscal 2020.|
- Scope 1 emissions reduction target does not include emissions from the Mountaineer acquisition, which is expected to close in 2021. The emmisions from the Pine Run acquisition, announced in February 2021, will be included in the baseline 2020 number as this investment will contribute to our five year goal. The 2020 base number also takes a 5-year emissions average from the Hunlock generation facility to account for year-over-year differences in run time.
- All domestic UGI companies use the OSHA definition for Total Recordable Injuries (“TRIR”). TRIR represents the number of work-related injuries or illness’s requiring medical treatment beyond first aid, per 200,000 hours.
- UGI International reports rates in accordance with the Industrial Management System guidelines. A TRIR represents a work-related recordable injury to an employee or hired staff that requires medical treatment beyond first aid, as well as one that causes death, or days away from work.
- UGI Utilities and UGI Energy Services use the American Gas Association definition for AVI, which defines an AVI as a reportable motor vehicle incident in which the driver failed to do everything that reasonably could have been done to avoid the incident.
- UGI International reports rates in accordance with the Industrial Management System guidelines. An AVI represents an incident that caused or contributed to, in whole or in part, by actions of the company driver or contractor driver, or an incident that could have been avoided by the company driver, using reasonable defensive driving measures, which resulted in injury or damage, either to the vehicle, or to the object struck, regardless of value.
- AmeriGas defines an AVI as any incident that could have been preventable.