Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Water Resource Management
• Renewable Energy
• Wildfire Mitigation
• Infrastructure Resilience

Environmental Achievements

• Reduced water usage per GSWC customer by 32% since 2007
• Reduced energy consumption through proactive operation and predictive maintenance of wastewater systems
• Completed $53.0 million of capital expenditures for wildfire mitigation projects through the end of 2022 (BVESI)

Social Achievements

• Strong customer and stakeholder engagement communications program in place for Public Safety Power Shut-off (PSPS) events (BVESI)
• Employee training program covering environmental awareness and water conservation principles

Governance Achievements

• Board oversight of ESG matters through the Nominating and Governance Committee
• Enterprise Risk Management (ERM) process for identifying and prioritizing risks
• Quarterly review of key risk mitigation strategies with the board

Climate Goals & Targets

Environmental Challenges

• Risks to maintaining adequate water quality and/or supply from climate variability, natural disasters, wildfires, and other events
• Aging water infrastructure
• Increasing impact of wildfires and other climate-driven events on utilities
• Meeting escalating RPS requirements for renewable energy

Mitigation Strategies

• Short- and long-term water supply planning, diverse water supply portfolio, contingency plans, water efficiency and conservation efforts, strong infrastructure
• Proactive investments in infrastructure replacement and protection
• Enhanced vegetation management, hardening critical facilities, integrating generators with SCADA, enhancing system redundancies (BVESI)
• Procuring a mix of renewable energy credits and renewable energy (BVESI)
• Developing solar generation and battery storage facilities (BVESI)

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Droughts
• Changes in weather patterns
• Natural disasters
• Wildfires

Transition Risks

• Regulatory changes related to water and energy
• Market shifts towards renewable energy

Opportunities

• Development of energy-efficient products and services
• Investment in renewable energy sources

Reporting Standards

Frameworks Used: TCFD

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Increased costs associated with addressing climate change risks, such as drought and wildfires in California, costs incurred in connection with complying with water quality regulations, and increased costs of operation and maintenance due to inflation, supply chain disruptions and increases in interest rates, while facing an increase in customer rate increase opposition and possible reluctance from the CPUC to pass through all such costs to customers
• Customer dissatisfaction due to rising rates needed to recover the costs of replacing aging infrastructure, address climate change risks, comply with water quality, renewable energy and greenhouse gas regulations
• Groundwater contamination and the increasing costs associated with treatment of groundwater due to contamination and increasing water quality regulation and mitigation of contaminants
• Risks of incurring losses not covered by insurance or recoverable in rates
• Risks of inadequate insurance coverages to cover significant losses due to a wildfire as insurance coverages become more expensive or unavailable on reasonable terms
• The adequacy of water supplies due to fluctuations of weather, climate change and other uncontrollable factors
• The impact that water conservation efforts may have on GSWC’s operations and costs incurred
• Cybersecurity incidents or information and operational technology outages, including cybersecurity incidents and outages caused by third party solutions that support operational or business processes, could disrupt operations and critical technology systems, resulting in an inability to deliver services to customers, loss of financial and other information critical to operations or the breach of confidential information of our customers, employees and vendors

Mitigation Strategies

• GSWC and BVES plan to continue seeking recovery of its operating and supply costs, and receive reasonable returns on invested capital
• GSWC and BVES may obtain funds from external sources in the capital markets and through bank borrowings
• BVES’s latest update to its WMPs have been approved by the OEIS and are pending CPUC ratification
• GSWC works proactively with third parties and governmental agencies to address issues relating to known contamination threatening GSWC water sources
• GSWC also incurs operating costs for testing to determine the levels, if any, of the constituents in its sources of supply, and additional expense to treat contaminants in order to meet the federal and state maximum contaminant level standards and consumer demands
• Increased investments in information and operational technology to monitor and address threats and attempted cyberattacks

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• droughts, storms, high wind events, wildfires, flash flooding and other natural disasters

Transition Risks

• regulatory changes, market shifts

Opportunities

• development of energy-efficient products