Sustainability

The rise of AI means more datacenters, and that means huge increases in electricity demand. In the US, natural gas is expected to play a prominent role in powering the AI boom. In this episode of the All Things Sustainable podcast, we’re talking with EQT, one of the nation’s largest natural gas companies, to understand what’s ahead for AI, the energy transition and sustainability. We sit down with Courtney Loper, EQT’s Head of Government Relations and Public Affairs, on the sidelines of S&P Global’s CERAWeek energy conference. She says natural gas can help the world shift away from coal-fired generation, which has a higher concentration of carbon emissions per unit of energy than natural gas. And she says EQT is focused on making its product as clean as possible, including by curbing carbon and methane emissions in its production of natural gas. "A big focus for EQT has been the replacement of international coal with US natural gas and really thinking about the emissions offset that can come from that," Courtney says. She says permitting reforms are needed in the US to get natural gas pipelines and other infrastructure built to meet growing energy demands from AI. Courtney also tells us the company's view on sustainability remains "unchanged." “Regardless of what winds shift in any sort of way around the idea of sustainability, it's something that we're going to continue to engage in, it's something that we're going to continue to promote, because it's important for the long-term viability of natural gas,” she says. Learn more about S&P Global’s energy transition data here . Read S&P Global Sustainable1 research, " Can AI become net positive for net-zero ?" Explore S&P Global Sustainable1 net-z ero data . Listen to our podcast interview with ExxonMobil at CERAWeek. Listen to our podcast interview with JPMorganChase . This piece was published by S&P Global Sustainable1, a part of S&P Global. Copyright ©2025 by S&P Global DISCLAIMER By accessing this Podcast, I acknowledge that S&P GLOBAL makes no warranty, guarantee, or representation as to the accuracy or sufficiency of the information featured in this Podcast. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice. Unless specifically stated otherwise, S&P GLOBAL does not endorse, approve, recommend, or certify any information, product, process, service, or organization presented or mentioned in this Podcast, and information from this Podcast should not be referenced in any way to imply such approval or endorsement. The third party materials or content of any third party site referenced in this Podcast do not necessarily reflect the opinions, standards or policies of S&P GLOBAL. S&P GLOBAL assumes no responsibility or liability for the accuracy or completeness of the content contained in third party materials or on third party sites referenced in this Podcast or the compliance with applicable laws of such materials and/or links referenced herein. Moreover, S&P GLOBAL makes no warranty that this Podcast, or the server that makes it available, is free of viruses, worms, or other elements or codes that manifest contaminating or destructive properties. S&P GLOBAL EXPRESSLY DISCLAIMS ANY AND ALL LIABILITY OR RESPONSIBILITY FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR OTHER DAMAGES ARISING OUT OF ANY INDIVIDUAL'S USE OF, REFERENCE TO, RELIANCE ON, OR INABILITY TO USE, THIS PODCAST OR THE INFORMATION PRESENTED IN THIS PODCAST. Learn about Climate Transition Assessment LEARN MORE View Full Transcript Transcript provided by Kensho . Lindsey Hall: I'm Lindsay Hall. Esther Whieldon: And I'm Esther Whieldon. Lindsey Hall: Welcome to All Things Sustainable, a podcast from S&P Global. As your hosts, we'll dive in to all the sustainability topics that are reshaping the business world. Esther Whieldon: Join us every Friday for in-depth analysis and interviews of leaders from around the globe. Together, we'll break down from big sustainability headlines and cut through the jargon. On this podcast, we've been talking about the balancing act around AI and sustainability. The world is experiencing massive growth in artificial intelligence, where AI needs more data centers, and that means huge increases in electricity demand. How do you meet that growing demand while also cutting the greenhouse gas emissions that lead to global warming like carbon dioxide and methane? At CERAWeek last month, we heard from many players in the energy industry that natural gas will play a prominent role in powering the AI boom. CERAWeek is one of the world's largest energy conferences. It's hosted by S&P Global each year in Houston. And on day one of the conference, we heard U.S. Department of Energy Secretary, Chris Wright, touting the importance of natural gas in the U.S. energy mix, where it supplies about 43% of electricity generation capacity today. Lindsey Hall: So what does this mean for climate goals? Well, natural gas has a lower concentration of carbon emissions per unit of energy compared to other fossil fuels like coal and oil. But natural gas' share of total energy-related emissions will grow as it continues to replace coal. For example, while total U.S. carbon emissions declined by 0.5% in 2024, emissions from natural gas alone increased by 1.3% that year. Natural gas is also a major emitter of another greenhouse gas, methane. Natural gas is primarily made up of methane and the fuel is invisible to the human eye. So leaks can be hard to identify. We'll dig into this aspect in a future episode. But what you need to know today is that in the U.S., oil and natural gas operations are the largest industrial sources of methane, that's according to the U.S. Environmental Protection Agency. The EPA has called methane a climate super pollutant that's significantly more potent than carbon dioxide and is responsible for approximately 1/3 of the warming from greenhouse gas. To learn more about this balancing act, today, we're talking with one of the largest natural gas companies in the U.S., EQT. I sat down on the sidelines of CERAWeek with Courtney Loper, the company's Head of Government Relations and Public Affairs. EQT has gas production and midstream gas operations primarily in the Appalachian Basin in the states of Pennsylvania, West Virginia, and Ohio. The basin is full of sedimentary stratified rock formations. These are known as shale, and they hold large volumes of natural gas, and the Marcellus Shale in the Appalachian Basin is the largest source of natural gas from shale in the U.S. As we'll hear today, EQT has set and last year achieved net zero Scope 1 and Scope 2 emissions across its legacy operations. That includes methane emissions. Scope 1 emissions are those occurring in the company's operations and Scope 2 emissions come from purchased energy. The company has not set a target for Scope 3 emissions that occur up and down its supply chain, including when customers burn gas for energy. Instead, as we'll hear from Courtney, EQT sees natural gas as a way to transition away from higher emitting coal-fired generation globally. Okay. Let's turn to the interview. Courtney Loper: So EQT is one of the largest natural gas producers in the country. We operate in the Appalachian Basin. We're a natural gas producer, so we're exclusively natural gas. We are a company that is uniquely focused on sustainability, right? And thinking about what the long term looks like for natural gas. And so for us, our objective is how can we empower humanity with the best energy source, right? And the best energy source is affordable, reliable, and clean. And I think that clean factor is one that EQT puts a particular emphasis on. So EQT back in 2021 set a net zero target and said by 2025, we will achieve net zero, which at the time was a pretty bold claim. And I think a lot of people perhaps question that, could you achieve it? We were incredibly excited to be able to achieve that at the end of last year. So EQT is the largest operator of scale or the only operator of scale to have achieved net zero on Scope 1 and 2 greenhouse gas emissions. Question and Answer Esther Whieldon: What about Scope 3 emissions? Is that something you're thinking about targeting in the future? Courtney Loper: It's an interesting question, and I think it's one that's really hard for the industry to try to quantify because Scope 3, you're really looking at how people use your product. And so for something like us where we're an upstream producer, we do have midstream assets, but we're primarily an upstream producer, right? And so it's hard for us to know where our product is used. And so you have all of these questions around redundancy or additionality. And who's counting what on the end use side of things? One thing that's really important to us is how people use our product to replace others. So a big focus for EQT has been the replacement of international coal with U.S. natural gas and really thinking about the emissions offset that can come from that versus looking just solely domestically. If you're looking at the global energy crisis and what we're sort of needing in order to address climate change, the answer truly is to address the elephant in the room, which remains global coal. And so that has been a big focus for us, which I think is technically Scope 4 versus Scope 3. Esther Whieldon: Scope 4, I think I have heard that term before, but how is that sort of defined? Courtney Loper: Scope 4, I believe, is the offsetting that occurs when people are using your product versus something else. And so for us, it really is looking at that strategic advantage in the utilization of natural gas, in particular, U.S. natural gas versus global. Esther Whieldon: Okay. So we've heard a little bit about your net zero targets. Talk me through how EQT is approaching working with communities and ensuring a just and equitable transition. Courtney Loper: It's a great question. So the department that I'm in is actually called stakeholder affairs. And what that includes is government relations, communications, community relations, charitable giving, and sustainability. And we really sort of see these as working hand-in-hand because you cannot have a functional company from a sustainability standpoint if you aren't meeting the needs of your community. And so for us, that interaction between the areas in which we operate is critical. Those are our key stakeholders, our landowners, our neighbors. And so the engagement that we have with them is near constant and the reputation that EQT has in our communities is strong because we're present, because we're making sure that we meet the needs that they're specifically outlining. And I think from a charitable giving perspective, it's really important not to just say, hey, we're going to give money where we think it needs to be -- what we do instead is have conversations and say, how best can we support your community? What does that look like to you specific to this community, not a one-size-fits-all model. And I think that the grassroots approach is what EQT does best on that side of things. Esther Whieldon: Tell me a little bit about EQT's approach to methane emissions. Courtney Loper: I love this question. It is such a big focus for us. Our CEO, Toby Rice, has been saying to elected officials over the past several years, put the focus on methane. Put the focus on methane because the industry is going to knock it out of the park. We're going to make sure that we can do everything possible to knock out emissions. When EQT was going through our own net zero targets, we said, how can we eliminate emissions as fast as possible. And so when we looked at that emissions profile, what we realized was there was one small pneumatic device that was causing the vast majority of our emissions, and so we set out a program to replace all of those. And so over the course of 1 year, 1.5 years, we replaced 9,000 of them and brought down our emissions by half and realized that this is something that isn't unique to EQT, can be replicated across companies. And so we put together a white paper specifically outlining how we did this, the tools that we use, the costs associated with it, and we put it on our website, so that other operators could do the same, so that other folks could have the same opportunity to bring down their emissions like we did. And on the methane side of things from a basin as a whole, not just EQT, we, with a couple of other operators, created an organization called the Appalachian Methane Initiative. And what this is, is a basin-wide look at methane emissions. And so we have aerial surveys that occur. And what they do is they look at not only the industry's emissions, but all emission sources in the basin. So they're looking at coal, they're looking at agriculture and really getting a fulsome picture of what's occurring. And we partnered with an educational consortium called EEMDL, the Energy Emissions Modeling and Data, and it's the University of Texas in Austin, CSU in Colorado, and Colorado School of Mines. And so we created this partnership with academics to say, "Hey, pressure test us, right? Make sure that this looks right." And so the data is going to these folks on the educational side of things so that the transparency and accountability can be there. It's not a take our word for it. And then we're using that data plus our operational data to really hone in on what exactly is happening. To be fair, what we're finding in a lot of these cases is that the vast majority of the emissions are coming from coal. And so it's helpful to us to know that because you have a lot of different organizations that are putting in satellites and aerial monitoring. And so for us to be able to have that really granular on-the-ground look at what's happening with our operational data associated with it allows us to specifically target not only the oil and gas industry's operations, but also additional methane emission sources within the basin. So we're taking a fulsome look at it. Esther Whieldon: Courtney mentioned that EQT was able to cut its emissions in half by replacing thousands of pneumatic devices on its system. These are devices that operate valves and things like pumps and controllers that are widely used in the oil and natural gas industry. And these devices can be a major source of methane emissions. Here's Courtney explaining a little more about how these devices work and why it made business sense for EQT to replace them. By the way, you'll hear her mention PNA that stands for plug and abandon and refers to the process of decommissioning or closing down oil or gas wells that have become less productive and are at the end of their useful life. Okay. Here's Courtney. Courtney Loper: Pneumatic device is basically a little valve that's opening during the operational process. And when that's occurring, it's emitting a little puff of the natural gas, right? So it's just releasing a little bit of the product. And so what we did was we replaced that so that release wasn't happening. So something that was happening as part of the operational process and very easily could be eliminated, we said, all right, let's take them out. This is something that we don't have to have. It can be replaced, makes sense to do so. I think we spent $20-some million doing it, which in the grand scheme of things, I think it's about $6 per ton, and it had a huge advantage on our emissions profile. So absolutely worth it from our end. Esther Whieldon: Is this a technology that a lot of wells and other things already have? Courtney Loper: Yes. I think there's a lot of factors that go into decisions on whether people can retrofit this. And sort of speaking from past experience or smaller operators, I can tell you that some folks say, is it worth it, right? If you have wells that are closer to the end of their sort of use life, right, and you say, we're going to P&A this well, it's going to be in reclamation soon enough. Is it worth retrofitting, right? Is it worth spending the dollars? But for those who have wells that will continue to operate for decades, I do think that it is worth it to replicate. And that's why we put together that white paper. But it's not technically a one-size-fits-all model, just depending on what your sort of production schedule looks like. Esther Whieldon: Courtney went on to describe some of the steps the company has taken to reduce its emissions. Courtney Loper: Yes. So the net zero target that we set has a couple of different components. Obviously, we have the pneumatics retrofits that I talked you through. We also have on our operational side of things, we switched from diesel fleets to electric fleets on our frac fleets, which also brought down emissions. We made some operational efficiency changes. And then for that delta that remained that we couldn't offset or that we couldn't reduce from an operational perspective, we said, "All right. How can we address this?" Obviously, offsets are an option that folks can utilize, but we really wanted it to be part of our operating area. If we're going to offset things, we're going to create this type of program. We want it to benefit the community in which we operate. And so we partnered with West Virginia University to create this nature-based offset program. And so what it is, is just forestry management. So part of it is eliminating disease, strategically looking at the sort of health of the trees as a whole and then some replanting. And this program as a whole, I think, is an excellent pilot for something that, again, could be replicated across states and really be beneficial to both the state in which we operate, the community in which we operate, and continue to reduce those emissions. Esther Whieldon: So we've heard about EQT's decarbonization strategy. I also asked Courtney how EQT is thinking about AI and putting it to use. Here she is again. Courtney Loper: So EQT, I would say, is a very digitally focused company. So we're actually fully remote as a company. And the way that we do that is through the utilization of Salesforce actually. So our company is very data heavy. We have data associated with everything, and so we can track our operations via our digital workspace. We can track all of the engagements that we have in the community via digital workspace. We have a really good record of what that looks like. So AI is a natural fit for that. And so what we're trying to determine is how you within the proper legal and security constraints, incorporate as much AI as possible into our workspace. So I think you'll see EQT be a leader in this. But right now, we're still in sort of the exploratory mode to determine what that looks like. I think from an AI perspective, the big thing that I would raise is, how are you going to power it, right? And the conversation about AI and natural gas feels like a really natural fit. You have data centers that need to get scaled up as fast as possible. You have a desire for the United States to be a leader in the AI space. And so natural gas can fill that opportunity. Natural gas can be that affordable, reliable, clean source of energy that AI is really needing. And for me, what this comes back to and a thing that I think is really important is -- in the Appalachian Basin, we have this really clean gas, right? Because it is just natural gas, because the methane emissions are so low, because you have operators like EQT with this net zero goal, this is a highly desired gas. And for folks who say, we need to power this with something reliable, but we want it to be clean, obviously, this basin is a priority. However, we're constrained. We're basically locked into the basin because we don't have the infrastructure to be able to get it out. And so a big focus for EQT is creating opportunity to build more infrastructure so that we can do things like power AI with that clean gas so that we can provide gas to places like New England that struggle with gas prices, so that we can continue to provide our allies with U.S. LNG and replace the Russian gas that's come off the market. So that, I think, component of AI is what's most interesting to us right now, but we're definitely going to be using it in our day-to-day work as well. Esther Whieldon: We've discussed today how AI is driving a huge increase in electricity demand. And to the extent that demand will be met by new natural gas plants, that may also mean that the U.S. needs to build out natural gas supply infrastructure such as pipelines to provide the fuel to those plants. At CERAWeek, we heard about the need for revamping U.S. permitting regulations to enable a more rapid build-out of infrastructure, including pipelines. We'll hear from Courtney about the challenges of building pipelines in the U.S., and that's due to the current federal permitting process, which often involves multiple agencies and environmental reviews. The process also allows for parties to challenge agency permitting decisions in federal courts, which can further stall projects. I asked Courtney about EQT's strategy on this topic. Here she is again. Courtney Loper: Our strategy has been pretty consistent. So regardless of who the administration is, EQT has been really pushing for permitting reform and infrastructure development. We believe this is a bipartisan push, right? This is something that all types of energy needs. If you want to build something in America, we've got to change the system and make it more viable for people to build large projects, right? We've been saying build, baby build, and that's not just exclusive to pipelines for us. Transmission is incredibly important for renewables. And so we still see a lot of opportunity from the bipartisan side of things to get this achieved. But you do have an administration that is very much supportive of infrastructure that has put out several executive orders saying, let's get back to building things. Let's put infrastructure in place. There is a good amount of work that can be done on the administrative things, but the real need of it is going to have to come through Congress. The things that we need to focus on from a congressional and legislative perspective are around judicial reform and really making it sort of less easy to hinder a project or delay a project until it becomes uneconomic in stalls out, which has been a strategy for those who are not interested in having any more pipelines in the United States. So there's a lot of change that needs to occur on the legislative side of things, which if you got to get something through the Senate, you got to have 60 votes. And so keeping that bipartisan engagement, that bipartisan approach is going to be important to us, plus layering on the support that's coming on from the administration side. So we're excited about what could possibly come over the next 2 to 4 years. Esther Whieldon: Okay. So we've heard a lot today at this conference about the need for changes to policies on infrastructure development and permitting. So kind of where do you sit on that? And what needs to happen to make it easier for you to get the infrastructure built? Courtney Loper: Yes. So I think the important thing about infrastructure is projects are supported. However, they're getting bogged down in sort of this legal slog, right? They're getting bogged down in lawsuits at every step of the way, and what that does is it drives up the cost and it expands the time. And so the end result of that is that a project becomes economic. For some folks, that's the goal, right? The hope is that the projects will no longer be completed. We believe that needs to change. We believe that there needs to be a way for infrastructure to go through the permitting process to be built in America, and we want folks to be able to lay in, right? We want communities to be able to have their say. But what we don't want is anti-fossil fuel opponents to be able to delay or halt a project. EQT acquired Equitrans just last year, and Equitrans was the owner of the Mountain Valley Pipeline, which is the last pipeline really that got developed in the United States. And the way that, that was achieved was through an act of Congress, right? We had to pass through the Fiscal Responsibility Act provision that specifically said the Mountain Valley Pipeline should be completed. It shouldn't have to be that difficult in the United States, right? It shouldn't have to be that difficult to build the infrastructure that we need to provide the energy to power our country. And so we believe that there needs to be some fundamental change around the process. And we're sort of eager to dive into that with any and all stakeholders. So the conversations that we've been having with -- around permitting reform are with Republicans, Democrats, environmental groups, industry groups. We'd love to talk to anyone and everyone, but let's solve this problem. Esther Whieldon: Great. Well, I think we're just about out of time. Anything we didn't get to you wanted to mention? Courtney Loper: I recognize that the conversation around ESG has been a little bit fraught of late. But EQT, in particular, is unchanged on our view on sustainability. Sustainability is important. That transparency and that accountability that comes with this process, with the reporting process, with the engagement around goals and certification is important to us. It's important to our stakeholders. And so regardless of what winds shift in any sort of way around the idea of sustainability, it's something that we're going to continue to engage in. It's something that we're continue to promote because it's important for the long-term viability of natural gas, and that's where we want to be. So that would be the only thing I would say as a takeaway, but I'm so grateful for the opportunity to talk to you today. Esther Whieldon: Yes. Thank you so much for taking the time. Have a great rest of your week. Esther Whieldon: Today, we talked about the role of natural gas in meeting the increasing electricity demand driven by AI growth and what that means for achieving climate goals. We heard how EQT, one of the largest U.S. natural gas companies, is managing emissions, including from methane, and we'll dig more into the topic of methane emissions in future episodes, including new technologies for measuring them and strategies for addressing them. Lindsey Hall: Courtney also discussed the need for permitting reform to build out critical infrastructure such as pipelines to support growing energy demands, and she said EQT's commitment to sustainability remains unchanged. Now that's an idea we've heard from multiple companies across sectors so far this year, including big U.S. bank, JPMorgan, and big oil and gas company, ExxonMobil. We'll continue tracking how companies are navigating the fast-changing landscape for sustainability in upcoming episodes. So please stay tuned. Thanks for tuning into this episode of All Things Sustainable. If you liked what you heard, please subscribe, share, and leave us a review wherever you get your podcasts. Esther Whieldon: And a special thanks to our agency partner, The 199. See you next time. Copyright ©2025 by S&P Global This piece was published by S&P Global Sustainable1, a part of S&P Global. DISCLAIMER By accessing this Podcast, I acknowledge that S&P GLOBAL makes no warranty, guarantee, or representation as to the accuracy or sufficiency of the information featured in this Podcast. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice. Unless specifically stated otherwise, S&P GLOBAL does not endorse, approve, recommend, or certify any information, product, process, service, or organization presented or mentioned in this Podcast, and information from this Podcast should not be referenced in any way to imply such approval or endorsement. The third party materials or content of any third party site referenced in this Podcast do not necessarily reflect the opinions, standards or policies of S&P GLOBAL. S&P GLOBAL assumes no responsibility or liability for the accuracy or completeness of the content contained in third party materials or on third party sites referenced in this Podcast or the compliance with applicable laws of such materials and/or links referenced herein. Moreover, S&P GLOBAL makes no warranty that this Podcast, or the server that makes it available, is free of viruses, worms, or other elements or codes that manifest contaminating or destructive properties. S&P GLOBAL EXPRESSLY DISCLAIMS ANY AND ALL LIABILITY OR RESPONSIBILITY FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR OTHER DAMAGES ARISING OUT OF ANY INDIVIDUAL'S USE OF, REFERENCE TO, RELIANCE ON, OR INABILITY TO USE, THIS PODCAST OR THE INFORMATION PRESENTED IN THIS PODCAST.

In this episode of the All Things Sustainable podcast, we sit down with Shinjini Menon, Senior Vice President of System Planning and Engineering at Southern California Edison, an investor-owned public utility operating as a subsidiary of Edison International. Southern California Edison is one of the largest US electric utilities, and Shinjini explains how it is prioritizing energy reliability and affordability while also building climate resilience — a topic that is particularly urgent in Southern California, where the risk of wildfires is so high. “We have put forward a pretty ambitious goal for decarbonization and the electrification that we believe is necessary for affordable decarbonization,” Shinjini says. “At the end of the day, it's about all of our communities having affordable access to energy, reliable energy, and having that energy security.” Shinjini explains how the utility uses technology, modeling and data to mitigate wildfire risks and make the grid more resilient. She says Southern California Edison has learned from peers in the US and other parts of the world as it works to build climate resilience. Listen to last week's interviews from the CERAWeek conference hosted by S&P Global here . Listen to our podcast episode about 2025 wildfires in Los Angeles here . Read research from S&P Global Sustainable1 about the projected financial costs of climate change for the world’s largest companies. Learn more about the S&P Global Sustainable1 Physical Risk dataset . This piece was published by S&P Global Sustainable1, a part of S&P Global. Copyright ©2025 by S&P Global DISCLAIMER By accessing this Podcast, I acknowledge that S&P GLOBAL makes no warranty, guarantee, or representation as to the accuracy or sufficiency of the information featured in this Podcast. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. This Podcast should not be considered professional advice. Unless specifically stated otherwise, S&P GLOBAL does not endorse, approve, recommend, or certify any information, product, process, service, or organization presented or mentioned in this Podcast, and information from this Podcast should not be referenced in any way to imply such approval or endorsement. The third party materials or content of any third party site referenced in this Podcast do not necessarily reflect the opinions, standards or policies of S&P GLOBAL. S&P GLOBAL assumes no responsibility or liability for the accuracy or completeness of the content contained in third party materials or on third party sites referenced in this Podcast or the compliance with applicable laws of such materials and/or links referenced herein. Moreover, S&P GLOBAL makes no warranty that this Podcast, or the server that makes it available, is free of viruses, worms, or other elements or codes that manifest contaminating or destructive properties. S&P GLOBAL EXPRESSLY DISCLAIMS ANY AND ALL LIABILITY OR RESPONSIBILITY FOR ANY DIRECT, INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR OTHER DAMAGES ARISING OUT OF ANY INDIVIDUAL'S USE OF, REFERENCE TO, RELIANCE ON, OR INABILITY TO USE, THIS PODCAST OR THE INFORMATION PRESENTED IN THIS PODCAST. Learn about Ceraweek Physical Risk LEARN MORE Learn about How oil major ExxonMobil is approaching the energy transition LEARN MORE View Full Transcript Transcript provided by Kensho . Lindsey Hall: I'm Lindsey Hall. Esther Whieldon: And I'm Esther Whieldon. Lindsey Hall: Welcome to All Things Sustainable, a podcast from S&P Global. As your hosts, we'll dive in to all the sustainability topics that are reshaping the business world. Esther Whieldon: Join us every Friday for in-depth analysis and interviews with leaders from around the globe. Together, we'll break down big sustainability headlines and cut through the jargon. Lindsey Hall: If you tuned in to last week's episode of this podcast, you heard us talking about how companies are balancing near-term energy needs with longer term sustainability priorities. Basically, it boils down to how the companies ensure they can meet the world's growing energy demands in an affordable and reliable way while also lowering emissions and adapting to climate change. Esther Whieldon: This was a big focus March 10 through 14 at CERAWeek. That's the Annual S&P Global conference in Houston, Texas that convenes stakeholders from across the energy ecosystem. This includes everyone from the world's largest fossil fuel companies, renewable energy, policymakers, scientists, academics, and utilities. We heard at CERAWeek how energy providers are working to strengthen infrastructure and enhance climate resilience in the face of more frequent extreme weather events. Lindsey Hall: And I sat down on the sidelines of the conference with one company that has a unique perspective on this topic, Southern California Edison. That's an investor-owned public utility operating as a subsidiary of Edison International. And Southern California Edison is one of the largest electric utilities in the U.S. It monitors and maintains a sprawling electricity system that includes 125,000 miles of distribution and bulk transmission lines. Today, we're talking to Shinjini Menon, the utility's Senior Vice President of System Planning and Engineering. As we'll hear in the interview, this role means she spends a lot of time thinking about how to balance the need for reliable, affordable energy on the one hand, and on the other hand, the risks of extreme weather events like wildfires, which are becoming more frequent and more severe with climate change. This is especially in sharp focus in Southern California, which experienced devastating wildfires at the beginning of 2025. We'll include a link in our show notes to a recent episode we did about those California wildfires. Okay. Here's Shinjini, who starts off by describing her role at Southern California Edison and the diverse market the utility serves. Shinjini Menon: I am responsible for our engineering team in Southern California Edison for the transmission and distribution grid. And what that entails is every aspect of engineering, starting with grid innovation as we have to redesign what the architecture of the grid is, how it's operated in the future, but also the nuts and bolts of engineering, asset management, engineering standards, designing the scope for all the work that goes to construction and maintenance and also field engineering. So we are over 50,000 square miles in Southern California. We serve about 5.2 million customer accounts, which means about 15 million customers altogether. It's a very diverse areas. There are urban areas, of course, but there's also the desert, rural areas, mountainous areas, and that kind of plays into how we go about our wildfire mitigation. For example, there are locations where it's relatively flat, relatively urban, it's easier to deploy mitigations, but there are other areas where it's quite congested and we look at, for example, what is the ingress and egress situation because that could add to the risk of wildfires. It's not just from potentially our equipment, but is it close to grasslands? Is it close to a canyon? And all of that goes into the risk modeling. And the other thing I'll mention about our service area is a third of our customers are what we'd call income qualified. So the equity and access of energy and security is a big part of what goes into the equation. So we have about 4,500 distribution circuits, but 1,100 of those are currently in high fire risk areas, but that seems to be expanding as we go, as we see more and more impact of climate change. Question and Answer Esther Whieldon: Okay. So with those factors that you've laid out, how are you balancing the need for security, reliability, affordability, and resilience to climate change? Shinjini Menon: So first of all, there is a portfolio-wide optimization that happens. So for example, from 2017 and '18, we had to focus on wildfire mitigation. That was such an urgent need. And you mentioned like the security, reliability, affordability of energy. Well, if the impact on the community safety from a wildfire, and again, it doesn't have to be associated with electrical equipment at all. Most fires start from non-electrical equipment. We needed to make sure we focus on that first, prioritize that. That did mean that we would step back and say, what else can we slow down a little bit. We wouldn't stop anything, but we might need to slow down. The other thing that we try to do is if we can integrate some of the work. So if you go into a location to do some wildfire mitigation work, are there other needs in that same location that we can do at the same time so that we can still get the work done more efficiently? Esther Whieldon: So talking about this need to slow down, but at the same time, I know from our past conversations, you've talked about, wow, we need to really move fast to address some of these urgent risks. How do you balance the need for speed with the need for going slow? Shinjini Menon: Right. So I think it's which things do you speed up and which things do you slow down or pause for a little bit. So for wildfire mitigation, we deployed over 6,000 miles of covered conductor in five or six years, which is a tremendous amount of work. Now the way we sped that up, there are various factors in it. The one is not trying to develop the technology ourselves. So we benchmarked internationally. Australia has unfortunately suffered from bush fires themselves. We saw other places, also in Japan, for example, they have deployed covered conductor. So we learned from them. Our engineers talked to their counterparts and so that we can deploy much faster. The second is we organized ourselves so that there was a dedicated group focused on wildfires so that they're somewhat insulated from the rest of the work so that they could focus on this. And a big part of it was our mindset shift because utilities often are not known for moving fast, innovation, and we also have, for good reasons, somewhat of a risk avoidance mindset. And as we were working on wildfire, we quickly changed that to how do we manage the risk. And all of those factors went into us being able to move much faster than we have done in the past and move efficiently. Lindsey Hall: I asked Shinjini, how she's thinking about climate resilience in her role. Here she is again. Shinjini Menon: Yes. So there are two aspects to it. We have been working on climate adaptation and resilience for several years. One aspect is more the long term, saying how do we need to get ready for where we place our equipment, what kinds of equipment we place, how we operate it for things like you know, more frequent or extended heat storms. It could be for massive amounts of precipitation and sea level rise and of course, wildfires. So the wildfire journey unfortunately started somewhere back in the 2017, 2018 time frame when some of the most devastating wildfires started happening in California. And then, of course, the most recent very unfortunate and devastating incidents in our service area in -- last January. So that entails coming up with what our protocols will be in mitigating risks or wildfire. And there are like three broad categories that we look at. One is situational awareness, how do we use hardware and models to understand what our risk is both ahead of any event or during events. The second is on our operational protocols that -- how do we manage an event or the system, whether it's like inspections or vegetation management or different kinds of switching protocols for proactive power shutoffs. And then the largest part of it is on grid hardening, saying how do we make our equipment and our infrastructure more resilient so that in case a wildfire happens, the impact is reduced on our system and also the other side that our equipment is not involved with starting wildfires. Esther Whieldon: Okay. I have a lot of follow-up questions, but let's start with the technology. Can you talk to me about the direction of travel for the technology that you're using to prepare for, adapt to, build resilience to wildfires? Shinjini Menon: Yes. So again, going back to the three categories I talked about, so for the situational awareness, a lot of the technology is a lot of sensors so that not only can you detect falls quickly, but anticipate falls before they happen so that we can take action quickly. A lot on weather stations and HD cameras. There is a lot of software technology, AI that goes in so that we can forecast weather better because that plays into how we operate, again, preparing for an event or during event if one happens. So there's technology on that side. There's also a lot of software technology that goes into our risk modeling. On the inspections and maintenance side, we now use drones and helicopters other than ground-based inspections that human beings are going and taking pictures of. We collect a lot of pictures and videos and we use technologies to automate some of -- like identifying what the issues are that we need to address. Again, it helps with not only cost efficiency, but sometimes it's better than human eyes looking at them. For vegetation management, apart from all the human activity, the manual activity that happens, we use LiDAR data to identify where there might be issues. And then on the grid hardening side, one of the flagship programs that we have had is deploying what we call covered conductor. Think of it as the overhead lines, they're just insulated. So that has been very helpful because you can deploy it fast, then you can buy down a lot of the risk. And then, of course, there's undergrounding. When we look at undergrounding, it's not only the traditional undergrounding, but we're exploring new ways so that it can be done much faster and cheaper. And then there are other more novel technologies. One is, I'll say it, but it's a mouthful, rapid earth fault limiting current. And what it really means is if there's a fault, let's say, a wire breaks for whatever reason in the wind or due to vegetation and fault on the ground, the fault current is reduced very, very fast to such small amounts that it will not start an ignition. So there are many other technologies like this that we are constantly looking into and deploying to mitigate wildfires. Lindsey Hall: We just heard Shinjini mention LiDAR data and that's light detection and ranging, a technology used to create high-resolution models of ground elevation. As I mentioned at the start of today's episode, we had this conversation on the sidelines of the CERAWeek conference in Houston, where a range of companies from across the energy ecosystem were present, including several utilities like Southern California Edison. I asked Shinjini, how are companies approaching climate change and how does that compare to peers? Shinjini Menon: So Southern California Edison started this journey several years back. And again, there is the climate resilience part of it, but there's also the climate mitigation. So we have put forward a pretty ambitious goal of -- for decarbonization and the electrification that we believe is necessary for affordable decarbonization. And as we have talked to our sister utilities in California or other utilities across the nation, both on the gas side and the electric side and definitely our regulators and legislators, you hear that a lot of people thinking that way and transitioning. I think the conversation sometimes gets very focused on climate change or climate resilience and there might be different points of view on that, but something that everyone can agree on is at the end of the day, it's about all of our communities having affordable access to energy, reliable energy, and having that energy security. And also all this work that's going on, all the changes in the technology, it is an economic boost as well. So I think different parties, different stakeholders can find that common ground and kind of move with a sense of urgency on the work we are doing. Esther Whieldon: Okay. Talk to me a little bit about some of the hurdles that you face when you're trying to scale these solutions, either on the decarbonization side or on the adaptation and resilience side. Shinjini Menon: There are a few for sure that we have encountered and learned from as we go along. So one I will mention -- so one of the mitigations that is one tool in our toolbox is public safety power shutoffs. So as electric utilities, our operators are hardwired to say, "Keep the lights on." And we had to train ourselves to say, "There are -- at times, the risk is so high that we need to proactively de-energize." Not only was it difficult for our workforce to internalize that, having that conversation with our communities. In the middle of this, we had COVID, everyone was working and studying from home, so they needed power all the time. And to help them understand that, yes, there are hardships that come with the power being off, what can we do to mitigate it? Either by notifying them on time or keeping them posted or also deploying some customer care methods. So we have vehicles out there so -- where customers can charge their phones or come and get a snack or maybe even some warmth during the winter months. So there are a lot of customer care programs that we have backup batteries and so on and so forth. So getting communities to understand why this is necessary, educating them, so that was one challenge that we had to learn how to overcome. The other piece is affordability. So all of these investments cost a lot of money. And how do you get legislators and regulators and customers on board to understand why that investment is necessary? And yes, there's a cost to action, but the cost for inaction is so much higher that it makes sense to invest that. And then the third part on the operational side, as we were moving fast, we always found, okay, this is not working very well. We don't want to compromise quality or safety as we are doing work and we were constantly checking that and adjusting as needed. Esther Whieldon: Okay. It sounds like a hard job. Shinjini Menon: It definitely is. But if there was any time that we needed to show up in our communities in a different way, it's now. Esther Whieldon: As you're looking ahead, what is the path forward for the utility industry broadly and SoCal Edison specifically to continue adapting and building resilience to climate change? Shinjini Menon: Yes. So I think one of the biggest things is using technology. And it's not just about climate change, it's also looking at the demand growth that is coming, not just from the natural demand growth. Everybody talks about data centers, but in our service area, it's residential growth, it's commercial growth, and of course, electrification. And they go hand-in-hand because the more people are using energy, the more climate change resilience becomes front and center for them. So benchmarking a lot, learning what others are doing because the more we can work with people, the more collectively we can move faster. And not just benchmarking within our industry, but we are looking at our suppliers, how do we make sure there's a diverse supplier base and they are resilient? Because if we don't get all the equipment on time, we can't deliver to our customers on time. So that's a big part of the equation. And then like I said, technology in the sense, how do we utilize the assets that we have available better? How do we harden them faster? There is so much happening. It's such an exciting time, both on the hardware and the software side is having a vision and really staying steadfast to it and looking for every opportunity to innovate and innovate fast. Esther Whieldon: Okay. I think my last question for you is about data. We love to talk about data on this podcast. What data are you relying on to make the decisions that you're making about investments in adaptation and other aspects of climate change? Shinjini Menon: Yes. So I mean, data -- there's all kinds of data and models that come into play. Definitely climate models, right? So there are a lot of climate models that we rely on looking at different scenarios. There is external data on -- in no particular order, definitely about weather, terrain, building codes because depending on how certain parts of our service area are built out, we can get some intelligence from that about in case a spark starts there, how much will it propagate. We rely a lot on risk models from many different external parties so that there is an independent review of that. And then, of course, our own asset data. Because right now, for the -- our high fire risk areas, we have very individualized risk models for every single asset. So every pole, every span of wire, every transformer has its own risk model associated with it, which means we need the data on the equipment itself, what its performance was in the past, and what kind of environment it is in. Esther Whieldon: Anything I haven't asked you about that you think is important for our listeners to understand about the landscape that you're operating in right now? Shinjini Menon: No. The only thing I'll add is that we have been on this journey for a while and there's a lot more to learn always, but we have built up a lot of knowledge base in that. And unfortunately, many parts of the country and the world are facing these new challenges and we are here to share what we can so -- if we can help them move faster. Lindsey Hall: So today, we heard how one of the largest electric utilities in the U.S. is balancing the need for security, reliability, affordability, and resilience to climate change. And this topic is particularly urgent for a utility that operates in Southern California where the risk of wildfires is so high. And as we heard, that can sometimes lead to hard choices like proactively shutting off power when the risk gets too high. Shinjini explained how Southern California Edison uses technology, modeling, and data to mitigate wildfire risks and make the grid more resilient. She also said the utility has learned from peers in other parts of the world like Japan and Australia as it works to build climate resilience. Esther Whieldon: We've been tracking these topics in our research at S&P Global as well. A recent report from our team sought to quantify the financial costs that the world's largest companies could face from a range of climate physical hazards in the absence of adaptation. We also explored how these hazards affect corporate assets using projections from the S&P Global Sustainable and Physical Risk data set. We'll include a link to that research in our show notes if you'd like to learn more. And we'll be back next week with more perspectives on the energy transition and building climate resilience. So please stay tuned. Lindsey Hall: Thanks for tuning into this episode of All Things Sustainable. If you liked what you heard, please subscribe, share, and leave us review wherever you get your podcasts. Esther Whieldon: And a special thanks to our agency partner, The 199. See you next time. Copyright ©2025 by S&P Global This piece was published by S&P Global Sustainable1, a part of S&P Global. 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