ESG 2019 Annual Report

The Environment

Sustainable Business Practices

At SJI, we take our commitment to environmental stewardship seriously.

Across our business, we measure our environmental impacts while making significant efforts to reduce or mitigate them. Additionally, we employ an Environmental Management System and procedures specifically designed to minimize waste and the use of hazardous materials, energy and other natural resources.

Across our organization we adhere to a strict set of environmental principles:

  • Conduct operations in compliance with all applicable environmental laws, regulations and corporate policies
  • Provide sufficient resources to achieve our environmental obligations
  • Promote pollution prevention and/or waste minimization through best management practices
  • Strive to continuously improve our environmental performance through environmental awareness training
  • Assess the effectiveness and performance of the environmental program by conducting periodic site audits
  • Work with regulatory agencies to develop scientific, fact-based environmental policies and regulations
  • Seek to further our environmental stewardship through the development of the next generation of environmentally friendly energy technologies

EPA’s Natural Gas STAR Methane Challenge Program

South Jersey Gas joined the U.S. Environmental Protection Agency’s Natural Gas STAR Methane Challenge Program in 2016 as a founding partner. Elizabethtown Gas joined the program in 2019, after being acquired by SJI. The program is designed to provide a transparent platform to utilities to make, track and communicate commitments to reduce methane emissions.

The STAR Methane challenge aligns with our commitment to protect our region’s environmental and natural resources. As part of our participation, SJG and ETG follow the Cast Iron and Unprotected Steel Best Management Practice. We pledge to reduce emissions by replacing a significant portion of our aging and leak prone bare steel and cast-iron distribution mains and services with modern, medium-density plastic and protected steel mains and services at a replacement rate of at least 5% per year.

Tracking and Reducing Greenhouse Gas Emissions

As part of our effort to reduce our environmental impact, we track the greenhouse gas emissions from our entire natural gas delivery system annually.

South Jersey Gas decreased its direct CO2-equivalent emissions from its system by 48 percent from 2011-2019. Elizabethtown Gas decreased its direct CO2 direct CO2-equivalent emissions from its system by 41 percent from 2011-2019. Elkton Gas only has cathodically protected coated steel and plastic mains and services within its system, which subsequently provides reduced greenhouse gas emissions when compared to unprotected steel and cast-iron systems.

Through SJI’s robust infrastructure replacement program, SJI increased its total miles of main by 14% and decreased its CO2-equivalent emissions from its system by 53% from 2006 to 2019. SJI’s infrastructure replacement programs will help SJI reach CO2-equivalent emissions reduction goal of approximately 80% by 2025 with the projected 20% increase of total miles of main when compared to 2006.

Parameter1 2006 2019 Amount Reduced Percent Reduced 2025 Projected Project Amount Reduced Projected Percent Reduced
SJI CO2 equivalent Emissions, metric tons 269,249 127,059 142,190 53% 54,891 214,358 80%
SJI Unprotected Steel & Cast Iron Main, Miles 2,237 447 1,791 80% 38 2,199 98%
SJI Unprotected Steel & Cast Iron Services, Number 61,666 45,254 16,412 27% 1,276 60,390 98%
SJI Total Main, Miles 8,812 10,081 - - 10,564 - -
SJI Total Services, Number 532,869 551,886 - - 540,582 - -

  1. Note: Emissions from pipeline main and service leaks only are included in above data. Emissions from above grade transmission-distribution transfer stations, above and below metering-regulating stations and combustion units are not included. In addition, ETG miles of pipeline cast iron main includes ductile iron.

Additional Greenhouse Gas Emissions data is provided in the ESG Metrics table, which was developed using the AGA/EEI template.

DISCLAIMER: The standards of measurement and performance as well as any goals disclosed in this report are based on various assumptions made in good faith at the time of publication and are not guarantees or promises of actual future performance and should not be construed as a characterization regarding the materiality or financial impact of that information. For a discussion of information that is material to SJI, please see our Annual Report or Form 10-K.

Waste Minimization and Recycling Program

SJI minimizes its waste production through source reduction, effective purchasing, chemical substitution, good housekeeping, and recycling when possible. SJI is proud of our recycling of asphalt, concrete, used oil, inefficient lighting lamps and blasts, contaminated soils, wood waste and more. In 2019, SJI recycled 798 tons of business-related pipeline construction and division/office location debris, which was 69% of total waste information available at the time of the report. SJI manages necessary waste disposal responsibly and we schedule frequent disposal pick-ups with waste disposal contractors.

SJI oversees Spill Prevention, Air Pollution Prevention, and Site Remediation programs and participates in EPA’s WasteWise. EPA’s WasteWise encourages organizations and businesses to achieve sustainability in their practices and reduce select industrial wastes. WasteWise is part of EPA’s sustainable materials management efforts, which promote the use and reuse of materials more productively over their entire life cycles.

Environmental Protection and Land Restoration

It is our priority to protect the environment and minimize our impact on the community and landowners.

Our engineering and construction departments plan every phase of each project from the initial construction phase through final restoration. SJI selects pipeline construction routes that avoid environmentally sensitive areas such as wetlands, wildlife habitats and their associated buffer zones. SJI also works with the community and landowners to choose routes with fewer impacts to property.

It is our goal to perform all work in compliance with all applicable federal, state and local laws (including common law), statutes, regulations, ordinances, rules, guidance documents, orders, judgments, and requirements as well as the terms of any licenses, permits, and authorizations of any governmental authority or public utility.

SJI works to restore all disturbed land back to its original condition after construction is complete. During land disturbance, preventative measures are utilized to control sediment runoff. SJI works closely with landowners to restore each property as specified in landowner agreements. This includes initial maintenance and repair work, as well as follow-up inspections of agricultural lands. SJI also makes every reasonable effort to complete cleanup of an area including final grading and installation of permanent erosion control structures and seeding disturbed right of way.

SJI and its partners have developed an Agricultural Impact Minimization Plan (AIMP) for major pipeline construction projects to address agricultural related issues, including restoration of agricultural land. The purpose of the plan is to outline how projects will impact landowners during the construction, surface restoration and the operation of the pipeline to minimize impacts on areas available for agriculture.

Responsible Energy Investments

South Jersey Gas is committed to building an infrastructure for natural gas vehicles in southern New Jersey.

To make the conversion to compressed natural gas possible for more businesses and vehicle fleets, South Jersey Gas supports the expansion of fueling station infrastructure. Currently, South Jersey Gas supplies 13 refueling stations across southern New Jersey. In 2019, South Jersey Gas began displacing gas at all company-owned and operated CNG stations with renewable natural gas – a clean, sustainable fuel made from methane. Elizabethtown Gas also has a fueling station, located at its headquarters in Elizabeth, New Jersey that is also open to the public and fleet customers. Through 2019, SJI operated more than 200 CNG-fueled fleet vehicles.

We also intend to initiate carbon reduction investments across both our utility and non-utility business over the next five years. Investments will be incremental to our prior utility capital plans. Specifically, we plan to focus on areas that 1) reduce energy consumption and emissions, 2) accelerate deployment of renewable energy, 3) educate customers on maximizing energy efficiency, and 4) modernize via technology innovations.

To date, we have already made significant investments in new energy sources that reflect our commitment to sustainability. First, our renewable natural gas supply will further reduce greenhouse gas emissions for all fleets using our SJG CNG stations, including the SJG fleet. Additionally, we have made investments in certified responsible natural gas, certified based on serval factors such as emissions, water sourcing, well integrity and community engagement providing the assurance that producers upheld the highest standards of care.

Map with CNG Locations

Environmental Investigation and Remediation

During the 1800s manufactured gas was produced from materials such as coal and oil at Manufactured Gas Plants. SJI oversees several long-inactive plants and sites owned by past or present subsidiary companies.

SJI is committed to ensuring that these sites are properly investigated and remediated and meet all environmental standards and regulations. As a result, in 2019, SJI had liabilities to 18 sites that required investigation or remediation.

Building an Environmentally-Friendly Workplace

As SJI continues to grow and expand, we unendingly look for opportunities to minimize our environmental footprint, including in our workplaces. In 2019, we made efforts at our facilities across New Jersey and Maryland:

  • All SJI facilities have comprehensive recycling programs
  • Our South Jersey Gas Headquarters follows the strict Leadership in Energy and Environmental Design (LEED) standards and processes, including high-efficiency LED lighting with occupancy sensors, automated window shades with connectivity to the HVAC system, waterless men’s restroom facilities, air hand dryers in all restroom facilities, filtered water stations that helped reduce the waste from discarded plastic water bottles.
  • Our janitorial services use green chemical products and recycled materials whenever possible
  • The cafeteria vendor for our new South Jersey Gas Headquarters sources food products with a focus on reducing their carbon footprint.