Dominion Energy

Dominion is the only company in the benchmark to score 100% for this indicator. In the last five years, the company has registered 26 patents, 21 of which were for low-carbon initiatives. The company has registered patents under the categories of climate change mitigation technologies in energy generation, transmission and distribution, smart grids and technology related to buildings.

Dominion has strengthened its target to reduce its scope 1, 2 and 3 (category 1, 3 and 11) emissions by 100% by 2050, by including scope 3 emissions which cover its purchased electricity. However, this target is still not ambitious enough to align with its 1.5°C pathway. The company can improve by bringing its net-zero target forward to 2035, which is consistent with the International Energy Agency’s (IEA’s) recommendation for electricity generation companies in advanced economies. Additionally, the company has set just one interim target: to reduce its scope 1 emissions from power generation by 55% by 2030 compared to 2005. It can improve its performance by setting more interim targets at gaps of no more than five years to drive immediate action.

Based on forward-looking projections of Dominion’s assets, the company is expected to significantly exceed its carbon budget between 2022 and 2037. Even considering the company’s plans to increase its renewable energy capacity and reduce its generation from fossil fuels, which will reduce its emissions, the long-term nature of these goals means its emissions intensity is unlikely to decrease at a rate fast enough for the company to remain within its carbon budget.

Engaging with its customers is integral for the Dominion to reduce its value chain emissions. The company has an education campaign that guides customers in managing their energy use. It offers the opportunity to buy solar power or carbon credits and provides incentives to purchase energy-efficient equipment. The company also has a programme for vulnerable community members that provides long-term energy savings by installing measures that reduce the customer’s energy costs. To support these efforts further and improve its performance, Dominion should include emissions reduction targets in its strategy and measure the impact of its actions.

Dominion shows support for climate policies. In 2020, it called for the Biden Administration to rejoin the Paris Agreement and take bold action on climate policy. At the state level, the company helped develop the Virginia Clean Economy Act and the North Carolina Clean Energy Plan, and it supports the Connecticut state goal to achieve zero-carbon electricity by 2040. However, Dominion also remains a board member of the American Gas Association (AGA) and National Association of Manufacturers (NAM), which are reported to oppose climate-aligned policies. Dominion can increase its credibility by severing its association with these organisations in support of its own climate stance and policy.

Dominion aims to reduce its scope 1, 2 and 3 (categories 1, 3 and 11) emissions by 100% by 2050 compared to 2005. It also aims to reduce its scope 1 emissions from power generation by 55% by 2030 compared to 2005.

The company has developed detailed integrated resource plans for its two operating segments. DEV plans for 5 GW of offshore wind power, 14 GW of solar power and 2.7 GW of energy storage by 2037. DESC plans to add 4.3 megawatts (MW) of solar power and 1.5 GW of battery storage by 2050. The company is also relicensing its nuclear facilities in Virginia. To reduce its emissions, the company plans to reduce its use of coal from 12% of its energy generation in 2021 to 1% in 2035, and to reduce gas-based generation from 40% in 2021 to 29% in 2035.

The company is investing in low-carbon research and development (R&D), including non-mature technologies such as direct air capture, small modular reactors (SMRs) and fusion technology. Dominion is also a lead sponsor of the Low-Carbon Resources Initiative, a five-year, USD 100 million R&D effort focused on emerging clean energy technologies. The company is also involved in the first offshore wind farm in federal waters. However, the company does not disclose its low-carbon R&D spending.

Dominion’s emissions intensity for its own energy generation decreased between 2017 and 2022, due to an increase in its renewable energy generation. However, this was not at the rate required by its 1.5°C pathway due to the continued high proportion of fossil fuels in the company’s generation mix. The company did decrease its emissions intensity for its purchased energy between 2017 and 2022 in line with its 1.5°C pathway. Though company disclosure on this is limited, this appears to be due to an increase in renewable energy in the company’s purchased power mix.

Dominion is indicating its commitment to a low-carbon future with its investment in new technology and plans for considerable renewable energy growth. However, nearly two-thirds of the company’s capital expenditure (CapEx) in 2022 was spent on fossil fuels. The company continues to rely on both gas and coal in its energy mix and is projected to significantly exceed its carbon budget between 2022 and 2037. It must increase its ambition and accelerate its transition to align with its 1.5°C pathway.

The company discloses the categories of stakeholders it engages with on a just transition, including employees, communities and other stakeholders. It further demonstrates the steps it takes to engage with these stakeholders on a just transition. However, no evidence was found of the company having a general commitment to engage in social dialogue, nor was there evidence to show the company’s ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found of the company undertaking just transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships.

The company has a commitment to create and support access to green and decent jobs as part of the low-carbon transition. Furthermore, it discloses the actions it takes to create jobs, including targeted construction and maintenance of new renewable electricity production. However, no disclosure was found of the company’s assessment of employment dislocation risks or efforts to embed equality of opportunity for women and vulnerable groups. The company has a commitment to reskill and upskill workers and stakeholders affected by the low-carbon transition and discloses the actions it takes in this regard. For instance, it offers training in partnerships with community colleges and internal training programmes. However, no relevant disclosure was found of a process for identifying skills gaps for workers and affected stakeholders in the context of the transition, nor measures to embed equality of opportunity for women and vulnerable groups in its efforts to reskill and upskill workers and stakeholders.

The company shows that it contributes to the social protection of workers through its actions. For example, after retiring a power station, the company ensured no workers were laid off without being offered severance packages or other positions in the company. However, no relevant disclosure was found to indicate if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights. However, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and in its supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. The company does, however, have a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. Additionally, the company discloses some statistics regarding the diversity of its workforce. However, the company can strengthen its disclosure on these subjects, as well as on its living wage and working hours practices.

The company commits to protecting personal data. However, no evidence was found of the company having a privacy statement regarding the collection, sharing and access to personal data. Additionally, the company discloses the amount of corporate income tax it pays in each tax jurisdiction where it is a resident for tax purposes. The company has a policy prohibiting bribery and corruption, and it includes corresponding clauses in its business relationship contracts. Furthermore, the company has a lobbying and political engagement policy, and it discloses its expenditure on lobbying activities. However, the company can strengthen its disclosure on all these subjects.