PG&E Agrees to Accelerate Salem Power Plant Cleanup(A)
One week after shareholders formally voted on a proposal at PG&E Corporation calling for a report on toxic and greenhouse air emissions, the company and the Massachusetts Department of the Environment agreed on April 22, 2004 to negotiate a new schedule to install pollution control equipment at the heavily-polluting Salem Harbor Station plant in Salem, Massachusetts.
Trillium Asset Management worked with the General Board of Pensions of the United Methodist Church and the Massachusetts-based environmental health advocacy group Healthlink to sponsor the shareholder proposal, which called for a report on the economic risks and benefits associated with emissions of carbon dioxide, sulfur dioxide, nitrogen oxide and mercury. The resolution gained 9% of the vote, a very respectable ratio for a first-year resolution on an environmental topic.
The shareholders and members of Healthlink met with PG&E officials in Boston the week before the shareholder meeting. They presented PG&E with an expanded proposal for the desired report and discussed the Salem Harbor Station, the single largest source of industrial air pollution in the state.
PG&E also operates the second largest source of air pollution in Massachusetts, the Brayton Point plant in Somerset. Relations between the corporation and residents in Massachusetts have been contentious for years due to the poor environmental records of these facilities. The Department of Environment and groups such as Healthlink have been fighting PG&E’s attempts to delay the cleanup of the Salem Harbor plant, so the announcement this week came as a sweet victory.
Healthlink’s Jane Bright told Trillium Asset Management that “the shareholder proposal and the meeting with PG&E were useful in convincing the company to move forward with the cleanup in Salem.”
Reducing emissions in Salem is expected to reduce asthma cases and premature deaths attributed to air pollution from the plant. According to a study conducted by the Harvard School of Public Health, current emissions from the Salem Harbor and Brayton Point power plants can be linked to more than 43,000 asthma attacks and nearly 300,000 daily incidents of upper respiratory symptoms per year in the region. The study also estimated that 159 premature deaths per year could be attributed to this pollution.
REMARKS BY STEVE LIPPMAN, Trillium Asset Management at PG&E Corporation Annual General Meeting April 16, 2003
Good morning Mr. Chairman, board of directors and my fellow shareholders.
My name is Steve Lippman and I am with Trillium Asset Management, a socially responsible investment firm with offices in Boston and San Francisco. I am here today to present Item No. 10 on your ballot, a shareholder proposal asking the company to report on the economic risks associated with emissions of sulfur dioxide, nitrogen oxides, carbon dioxide and mercury, and the potential benefits to our company from reducing those emissions.
This proposal has been sponsored by the General Board of Pension and Health Benefits of the United Methodist Church, and three individual shareholders: Lori Ehrlich, Jane Bright and Gail McCormack. Collectively, the filers hold over 66,000 shares of stock in PG&E. Ms. Bright, Ms. McCormack and Ms. Ehrlich are members of Healthlink, a community organization based in Marblehead, Massachusetts; they are neighbors of PG&E’s Salem Harbor Station electric power generating facility. My firm has been involved as another interested shareholder in PG&E.
According to the Environmental Protection Agency, Salem Harbor Station releases more toxic emissions into the air than any other industrial facility in the state of Massachusetts, a point to which I will return in a moment.
The proponents have asked me to convey to you today our conviction that the proposed report will benefit PG&E and its shareholders. Through dialogue and other means of engagement, these shareholders consistently encourage companies to adhere to a bottom line that meets their financial, social and environmental obligations to shareholders and society. All the proponents believe that the transparency requested in reports such as this are part of realizing that there truly is only one bottom line and that successful companies recognize the need for both financial and non-financial reporting as their obligation.
We do not request this report because we believe that our company is an industry laggard on toxic emissions. Indeed, we are well aware that PG&E’s toxic air emissions are below the national averages of its industry peers.
However, our company’s record and reputation are greatly tarnished by the poor performance of Salem Harbor Station and the Brayton Point facilities. These facilities are, respectively, the first and second highest emitters of toxic releases in the state of Massachusetts. PG&E is trying to delay the cleanup of the Salem Harbor Station by two years longer than the state has ordered. But this delay will have a painful impact on residents of the region. According to a study conducted by the Harvard School of Public Health, current emissions from the Salem Harbor and Brayton Point power plants can be linked to more than 43,000 asthma attacks and nearly 300,000 daily incidents of upper respiratory symptoms per year in the region. The study also estimated that 159 premature deaths per year could be attributed to this pollution.
Mr. Chairman, the citizens of Massachusetts and neighboring states have breathed these poisonous emissions for too long. The plant’s neighbors have long lobbied PG&E to begin an immediate cleanup of this facility, but the only response from management has been further delay. Relations between PG&E and the communities of Boston’s North Shore are an embarrassment to this company’s shareholders.
Our company aspires toward environmental leadership, but this goal will be elusive until taking swift action is taken in Salem. Implementing our proposal is means toward reaching both ends.
On behalf of the all proponents of this resolution and the citizens of Salem, we urge the company to be more transparent in its reporting and taking necessary action in Salem. While we thank you for the opportunity to speak with management within the last week about this, regardless of the vote result today, we look forward to follow-up dialogue which will lead to a positive resolve of these matters.
Thank you for your attention.