Dominion Energy, Inc. · NYSE:D
Dominion Energy — ESG Presentation (November 2020)
41 slides from Dominion Energy's sustainability presentation, Nov 30, 2020
Slide 1: Environmental, Social, and Governance Fall 2020
f Environmental, Social, and Governance Fall 2020 Please refer to page 2 for risks and uncertainties related to projections and forward looking statements
Slide 2: Important note for investors
Important note for investors This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Dominion Energy. The statements relate to, among other things, expectations, estimates and projections concerning the busine
Slide 3: Compelling investment proposition
Dominion Energy Compelling investment proposition Premier state-regulated utility operations Industry-leading clean energy profile Attractive long-term earnings and dividend growth Robust credit profile and balance sheet Focus on consistency and transparency Please refer to page 2 for risks and unce
Slide 4: Operating profile
Operating profile Significant strategic repositioning since 2016 Divestiture of State- gas transmission & regulated storage assets and utility cancellation of ACP contribution (2020) Divestiture of gas (2019) gathering & State-regulated utility operations: processing and ~85%—90% residual fossil-fue
Slide 5: Why ESG?
Why ESG? Dominion Energy’s commitment to industry- leading environmental, social, and governance performance is driven by our belief that the best companies seek to: ✓ Consider the interest of all stakeholders as critical to success including shareholders, employees, customers, and communities ✓ Str
Slide 6: Industry-leading ESG performance starts with…
Industry-leading ESG performance starts with… ✓ Effective governance and risk oversight at Board and management levels ✓ Ambitious commitments across ESG categories ✓ Accountability driven by core values and aligned incentives ✓ Transparent and relevant disclosure aligned with leading ESG frameworks
Slide 7: Effective governance at Board and management levels
Effective governance at Board and management levels Board of Directors Board expertise (% of directors) Diversity & tenure Best practices ✓ Independent: 11 of 13 directors (incl. lead) and Corporate leadership 100% 100% of Committee members Corporate governance 100% 31% ✓ Separation of roles: CEO an
Slide 8: Effective Board-level climate governance and strategy
Effective Board-level climate governance and strategy Effective climate strategy and governance = prudent risk management Board oversight of climate matters Select climate-related risks Board of Directors Changing stakeholder preferences ▪ ESG strategy is a cornerstone of overall business strategy R
Slide 9: Effective climate governance at management level
Effective climate governance at management level Select climate oversight—leadership across management Reports to Membership Climate-related roles and responsibilities Created Dominion Energy Board Executive management ▪ Develop and oversee sustainability strategy N/A Leadership Team team and initia
Slide 10: Accountability driven by core values & aligned incentives
Accountability driven by core values & aligned incentives Core values One Dominion Embrace Safety Ethics Excellence Energy Change (Teamwork) Innovative Our highest Best in class Sustainable culture ensures priority is Doing right and performance performance creation of keeping our doing well are dri
Slide 11: Accountability driven by core values & aligned incentives
Accountability driven by core values & aligned incentives Aligned incentives Short-term incentive scoring criteria¹ Existing stock-ownership requirements are robust At least We believe that industry-leading ESG-performance will result in higher long-term returns (including stock 30% of incentive sco
Slide 12: Transparent and relevant disclosure
Transparent and relevant disclosure Description Latest published Sustainability and ▪ “Flagship” sustainability disclosure with detailed reporting on ESG strategy including Corporate governance, performance, comprehensive methane and carbon metrics, and Responsibility (SCR) commitments October 2020
Slide 13: ESG performance: third-party assessments
ESG performance Third-party assessments Dominion Energy’s independent scoring reflects best-in-class ESG performance Dominion Energy Sector average A A- 91 77 B B 31 69 A 33 BBB 55 CDP—Climate CDP—Water MSCI Sustainalytics CPA-Zicklin JUST risk score CPA-Zicklin Climate Water 2019 2019 2020 2020 202
Slide 14: ESG performance: third-party assessments
ESG performance Third-party assessments Continued participation and improved results across all assessments A 91 91 91 A- 87 B B B A A 69 Scoring 61 methodology 54 BBB BBB 47 changed in 2020 33 F Dec. Dec. 2017 2018 2019 2020 2017 2018 2019 2020 2017 2018 2019 2020 2017 2018 2019 2020 2017 2018 2019
Slide 15: ESG performance: third-party recognition
ESG performance Third-party recognition FORTUNE 2020 2020 World’s Most 2019 America’s Best JUST 100 in “Trendsetter” Admired Companies Employers 2020 and 2021 Award Military Times “Best for Vets 2020 America’s Most 2020 Best Employers U.S. Veterans Top Supplier Employer” for 10th consecutive year Re
Slide 16: Actions Speak Louder
Social Commitments to social justice and equity in 2020 ▪ Towards social justice, community reconciliation, and rebuilding $5M ▪ $4M to community nonprofits that impact social justice and equity ▪ $1M towards community rebuilding with a focus on minority-owned small businesses Actions ▪ HBCU Promise
Slide 17: Diversity & Inclusion: Recruiting and retaining a diverse workforce
Social Diversity & Inclusion: Recruiting and retaining a diverse workforce Philosophy Improving our new hire diversity ✓ Promote a workplace culture that encourages inclusiveness, collaboration, flexibility, and fairness % of new hires that are diverse² ✓ Strive for diverse representation at every l
Slide 18: Diversity & Inclusion: Employee Resource Groups
Social Diversity & Inclusion: Employee Resource Groups (“ERGs”) (#) represents cumulative ERG chapters 2015 2016 2017 2018 2019 (2) (4) (8) (13) (22) • We3 • ¡HOLA! • YP • DiverseAbility • API • VRG • AARG • PRIDE • We3 (West) • We3 (OH) • We3 • VRG (WV) • VRG (West) (+Women in Nuclear) • VRG (OH) •
Slide 19: Diversity & Inclusion: Supplier relationships
Social Diversity & Inclusion: Supplier relationships Dominion Energy works to ensure that a Percentage of total procurement¹ from diverse suppliers spectrum of businesses can participate in our procurement process. Including those that are: Represents over ▪ Small $750M of annual 20% spend ▪ Local o
Slide 20: Environmental Justice
Social Environmental Justice “At Dominion Energy, we are committed to providing reliable, affordable, clean energy in accordance with our values of safety, ethics, excellence, embrace change and teamwork. This includes listening to and Collaborate Purposely to resolve ✓ Established seek out a learni
Slide 21: Giving aligns with customers, communities, environment
Social Giving aligns with our focus on customers, communities, and the environment Charitable foundation giving (2019) Select initiatives ✓ Energy assistance – Energy Share program started in 1982 11% – Weatherization services Health and human services 27% 12% – Community outreach and education Educ
Slide 22: COVID response
Social COVID response Customers Employees Communities ▪ Voluntarily suspended non-payment ▪ Relief fund for employees facing ▪ $1M for relief efforts service disconnections and late fees financial hardships ▪ Partnered with state governments across all regulated territories ▪ 80 hours additional sic
Slide 23: Employee safety
Social Employee safety OSHA recordable incident rate¹ ~40% better than 2019 record performance More than 3x lower than industry in 2018 100 employees each work year 1.78 Number of recordables per 1.44 1.50 1.34 1.32 1.06 1.02 1.04 1.00 0.92 0.88 0.80 0.65 0.68 0.62 0.38 2006 2007 2008 2009 2010 2011
Slide 24: Customer affordability
Social Customer affordability Typical residential electric bill VA residential rate evolution (cents per kWh) (12%) (8%) DEV 2008-2019 CAGR: ~0.5% National Average 2008-2019 CAGR: ~1.4% (5%) (2%) DEV National Average 13.98 $133.10 $123.40 $125.30 $122.31 $116.87 11.98 11.38 10.72 DEV (VA) Virginia D
Slide 25: Net Zero
Environmental Net Zero After significant stakeholder engagement, Dominion Energy introduced an enterprise-wide emissions target of “Net Zero carbon and methane by 2050” in early 2020 ▪ Inclusive of power generation and gas business CO2 and methane emissions ▪ Focus on Scope 1 emissions ▪ Measured in
Slide 26: Net Zero: Enterprise-wide CO2e
Environmental Net Zero Enterprise-wide CO2e¹ Estimated reductions by 2035 from 2019-levels: ~55%↓ ~70%— Electric generation: 35-45% Gas operations: 60-70% 80%↓ NET ZERO Baseline 2019 2035 2050 Complete Medium-term Long-term ¹ Reflects Scope I carbon and methane emissions measured in millions of metr
Slide 27: Today: Electric generation emissions intensity
Environmental Today: Electric generation 2018 electric generation emissions intensity relative to U.S. utility peers (CO2e MT / Net MWh) 1.03 Higher intensity 0.97 0.85 0.8 0.77 0.73 0.73 0.69 0.58 0.55 Average: 0.476 0.47 0.48 0.49 0.43 Lower intensity 0.41 0.27 0.28 0.28 0.2 0.22 0.07 0.08 0.05 0.
Slide 28: Medium-term: Emissions-reduction capital investment through 2035
Environmental Medium-term: Significant emissions-reduction capital investment through 2035 OFFSHORE SOLAR OR ENERGY NUCLEAR LIFE GAS RENEWABLE WIND ONSHORE WIND STORAGE EXTENSION DISTRIBUTION NATURAL ▪ Up to $8B to ▪ Over $19B ▪ Up to $7B ▪ Up to $4B MODERNIZATION GAS $17B ▪ Up to $6B ▪ Up to $2B ✓
Slide 29: Medium-term: Renewable capacity growth
Environmental Medium-term (electric generation): Renewable capacity growth Conforms with public electric utility integrated resource planning filings 28.3GW 2.9GW 2019 2025 2030 2035 Battery storage Wind Hydro¹ Solar ¹ Excludes DEV pumped hydro Please refer to page 2 for risks and uncertainties rela
Slide 30: Medium-term: Coal and oil-fired generation retirements
Environmental Medium-term (electric generation): Coal and oil-fired generation retirements Cumulative capacity retirements (nameplate MW) 2028 capacity relative to 2018 levels: Coal¹ Oil Coal: 40% reduction Oil: 66% reduction 4.2GW 4.3GW Coal + oil: Nearly 50% reduction 3.7GW 1.9GW 1.3GW 2019 2021 2
Slide 31: Medium-term: Increased reliance on zero and low carbon
Environmental Medium-term (electric generation): Increased reliance on zero and low carbon Electric generation by fuel type (Mwh) Future: Past: Present: 2035 2005 2019 (est) Renewable 1% 4% 33% ~68% zero carbon Nuclear 36% 42% 35% ~94% Natural gas 7% 42% 26% zero/low Coal 52% 12% 6% carbon Other 4%
Slide 32: Medium-term (gas operations): Safe, reliable, affordable, clean
Environmental Medium-term (gas operations): Safe, reliable, affordable, and clean Sustainable future Transmission & Storage divestiture impacts ▪ Industry leading methane reduction program ▪ Specific plan to reduce emissions 65% by 2030, 80% by 2040 ▪ Supporting and piloting new technologies will dr
Slide 33: Long-term: 2036 to 2050
Environmental Long-term: 2036 to 2050 ▪ Longer-term planning subject, by nature, to more uncertainty ▪ Technology has the potential to evolve rapidly ▪ Breaking through the battery “wall” ▪ Hydrogen & RNG opportunities (including applications across existing assets) ▪ Company has been and will conti
Slide 34: Appendix
APPENDIX Please refer to page 2 for risks and uncertainties related to projections and forward looking statements 34
Slide 35: Operating profile
Operating profile State-regulated utility operations Regulated-like Dominion Energy Dominion Energy Contracted Gas Distribution Assets Virginia South Carolina (formerly Contracted Generation) CT OH UT VA ID States of operation WY WV SC CA Southeastern UT & Mid-Atlantic NC UT U.S. NC Pro forma operat
Slide 36: Progression of select decarbonization milestones and targets
Progression of select decarbonization milestones and targets Milestone 2020+ 2021+ ▪ Continued execution of Net Zero commitment ▪ Updated Climate Report ▪ Announced Net Zero carbon and methane emissions by 2050 ▪ Updated methane targets 2020 ▪ 65% reduction in methane emissions by 2030 (vs. 2010) ▪
Slide 37: Governance: Compensation practices
Governance Compensation practices What we do: What we don’t do: ✓ Balance short-term and long-term incentives Allow payout of AIP awards or performance grants greater than ✓ Place a substantial portion of CEO/NEO pay at risk and tie to 200% of target enhanced shareholder value Offer long-term or
Slide 38: Transparency and disclosure
Transparency and disclosure 2020 CPA-Zicklin Index of Corporate Political Disclosure and Accountability 91.4 77.2 “Trendsetter” ~15% of S&P 500 companies 50.1 “The Center for Political Accountability (CPA) is a non-profit, non-partisan organization working to bring transparency and accountability to
Slide 39: Lobbying and climate strategy
Transparency and disclosure Lobbying and climate strategy Climate strategy and Lobbying compliance and transparency lobbying alignment ✓ Policies developed to support the letter and spirit of all applicable federal and state • Our public policy strategy laws and regulations aligns with our corporate
Slide 40: Virginia rural broadband
Social Virginia rural broadband ✓ Provide “middle-mile” fiber optic cable infrastructure to bridge the gap to rural locations ✓ Reduced broadband deployment costs for internet service providers ✓ Helps close the “digital divide” to ensure more communities and businesses can access highspeed internet
Slide 41: Transparent and relevant disclosure: Links
Transparent and relevant disclosure Links ▪ 2019 Sustainability and Corporate Responsibility Report ▪ 2018 Climate Report ▪ Climate CDP ▪ Water CDP ▪ Virginia IRP ▪ South Carolina IRP ▪ Political contributions Please refer to page 2 for risks and uncertainties related to projections and forward look