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Respondent CDP 2007: NiSource Inc.

General Introduction
<>If like introduction answers enter

 
Section A – 1 Climate Change Risks, Opportunities and Strategy
Question 1(a)(i) – Regulatory risks
<>For question state time period possible associated financial implications commercial risks does climate change present company including regulatory risks associated current and/or expected government policy climate change e g emissions limits energy efficiency standards
regulatory impacts associated climate change companies NiSource exclusively U S based company existing required applicable GHG reduction program continues lively debate U S GHG management global warming prospect mandatory GHG programs NiSource operating areas longer appears remote entirely clear instances final shape action(s) form reporting requirements mandatory limits GHGs cap trade mechanism carbon tax program technology focus Legislation debated federal level state legislatures NiSource operating areas process approved GHG bills state bills primarily focused mandatory emissions reporting voluntary reduction registries GHG related impact risk opportunity depend largely final shape(s) regulatory programs likely largely influenced ultimate outcome U S Congressional debate climate change alternative environmental regulatory proposals formation stages NiSource active natural gas trade associations NGOs including Interstate Natural Gas Association America American Gas Association Combined Heat Power Association Business Council Sustainable Energy NiSource worked groups help shape concepts important domestic action reduce GHG including recognition energy efficiency end usage power generation incorporating significant role efficient distributed power generation increasing cleaner base load generation regulatory program likely address prevalent GHG carbon dioxide CO2 increase operating costs regulated electric generation portion NiSource’ s asset portfolio Specifically NiSource generates electricity subsidiary Northern Indiana Public Service Company (NIPSCO) addition natural gas distribution business small hydroelectric plants currently operates coal fired electric generating stations net capacity approximately 2 900 megawatts climate related business risk greatest impact NIPSCO electric operations regulated NIPSCO electric operations represent approximately 30% NiSource annual operating income (the remaining 70% operating income comes regulated natural gas transmission storage distribution) timing extent cost increases depend GHG regulatory program ultimately enacted expected NIPSCO provided opportunity recover costs regulated rate structure NiSource mix assets virtually regulated utilities GHG regulatory risks greatly reduced wide range proposed regulatory alternatives majority NiSource revenue net income comes delivering natural gas (the fossil fuel lowest carbon intensity important potential contributor reduced domestic GHG emissions) regulatory risks reduced provide market opportunities instance government policy likely lead adoption stringent energy efficiency standards variety energy consuming products increased demand utilities participate energy efficiency programs measures aimed reducing consumption and/or improving efficiency electric natural gas usage utility regulators shown increased rate structures strategies align utility public aims disconnecting profits fixed cost recovery sales volumes ensuring program cost recovery NiSource companies opportunity work regulators various states create alternative financial structures promote energy efficiency cost effective yield lower cost cleaner reliable energy NiSource continue actively monitor participate GHG regulatory developments interim NiSource continue pursue climate change strategies reduce GHG footprint improve generation natural gas delivery efficiency promote customer energy efficiency

 
<>Would like provide additional information relating question provided
 No 

 
Question 1(a)(ii) Physical risks
<>For question state time period possible associated financial implications commercial risks does climate change present company including physical risks business operations scenarios identified Intergovernmental Panel climate Change expert bodies sea level rise extreme weather events resource shortages
Energy deliveries sensitive variations weather specifically respect customer demand operations energy costs electric natural gas assets natural gas used commonly power generation NiSource diversified risks Extreme weather conditions result temporary operational outages cases result property damage outages reduce customer usage revenues increase operating costs (Electric delivery wires typically vulnerable storm damage ground natural gas pipelines ) unusually active 2005 hurricane season impacted certain NiSource operations increased natural gas price volatility NiSource pipelines did suffer material impact Weather conditions affect energy prices costs wholesale retail markets impacting demand minimize overall price volatility NiSource strategy hedge certain percentage energy purchases NiSource companies use extensive underground natural gas storage position moderate effect higher winter season commodity prices provide greater reliability natural gas supply NiSource’ s strategic investments decade diversify natural gas assets various geographic regions mitigate weather risk provide robust supply gas areas need supply Finally government actively encourages efficient site generation provides greater electric reliability physical risks associated electric reliability reduced

 
<>Would like provide additional information relating question provided
 No 

 
Question 1(a)(iii) risks
<>For question state time period possible associated financial implications Apart regulatory physical risks described answers questions 1(a)(i) 1(a)(ii) commercial risks does climate change present company including shifts consumer attitude demand
Consumer attitude demand energy products services likely influenced broad array factors closely linked regulatory market forces discussed momentum builds reduce carbon emissions commercial risks potentially stem reductions demand gas electricity generated fossil fuels accompany consumer conservation energy efficiency improvement efforts switching renewable forms energy risk largely mitigated fact 70% NiSource revenue derived natural gas fossil fuel lowest carbon intensity compatibility end use efficiency important potential contributor reduced domestic GHG emissions NiSource’ s overall risk reduced extent regulatory market forces drive consumers increase demand lower carbon fuels natural gas natural gas fueled high efficiency end use technologies NiSource currently working regulators states implement demand programs offer variety incentives encouraging energy conservation efficiency improvements low income customers addition renewed growing support regulatory strategies separate decouple recovery fixed costs volume gas delivered customers NiSource continue working regulators formulate effective strategies expanding types programs broader customer base manner achieves overarching policy objectives sustainable way

 
<>Would like provide additional information relating question provided
 No 

 
Question 1(b) Opportunities
<>For question state time period possible associated financial implications commercial opportunities does climate change present company existing new products services
timing extent climate change prompts new requirements reduce greenhouse gases (GHG) represent commercial opportunities NiSource general view climate change represents business opportunity NiSource subsidiaries majority corporation’ s business involves transporting storing delivering natural gas Natural gas described key “ bridge” future lower carbon intensive energy infrastructure benefits include direct end user efficiencies highly efficient distributed power generation supplemental fuel intermittent renewable technologies role increase affordable alternative technology developed deployed Shifting natural gas usage higher efficiency generation dramatically improve nation’ s GHG profile conserving natural resource domestic power sector comprising nation’ s GHG inventory climate change shape energy environmental policies encourage efficient natural gas usage NiSource operates nation’ s largest delivery systems natural gas key element NiSource’ s growth strategy includes expansion commercial growth natural gas pipeline storage businesses growth strategies outlined 2006 NiSource Annual Report consistent NiSource Environmental Health Safety Climate Change Policies collectively pledge “ … provide products solution reducing nation’ s greenhouse gas emissions… address global climate change challenges business activity compatible sustained economic growth ” decade NiSource companies developed deployed energy products utilize advantages gaseous fuel highly efficient energy technologies products offer customers various attributes including predictable energy costs better power quality increased reliability addition technologies lower carbon profile coal based centralized generation NiSource utility companies promote development large site combined heat power (CHP) projects designed provide significant improvements customer energy efficiency NiSource’ s Primary Energy (Primary) affiliate developed constructed projects conjunction energy intensive industry located Indiana projects constructed late 1990s early 2000s high energy efficiency rate new plants significantly improved overall GHG emission rate NiSource companies’ generation projects provide approximately 1 000 megawatts generating capacity steam internal use located industrial facilities NiSource divested Primary projects operation continue provide low carbon intensity energy reliable electric power Northwest Indiana NiSource Energy Technologies (NET) pioneered highly efficient distributed generation systems commercial small industrial customers NET’ s business focused research development sales market development investment emerging technologies future NET’ s products play significant role achieving various energy environmental objectives including reduced carbon emissions NET's successes include • Installation nation's energy micro cogeneration Walgreen's store Northwest Indiana • collaborative effort Hilton Garden Inn Northwest Indiana Department Energy design modular package hotel industry • Recognition EPA’ s Combined Heat Power Partnership NET’ s "superior environmental performance"

 
<>Would like provide additional information relating question provided
 No 

 
Question 1(c) Strategy
<>For question state time period possible associated financial implications objectives targets strategies undertaken planning manage risks opportunities detailed questions 1(a) 1(b) include adaptation physical risks
fully realize stated opportunities NiSource developed business activities taken national leadership role advocating clean energy alternatives reasonable public policy NiSource represented board executive member Combined Heat Power Association Business Council Sustainable Energy Interstate Natural Gas Association America Greenhouse Gas Task Force American Gas Association Climate Committee fully participate 2007 national discussion mandatory federal legislation NiSource approved preference climate legislation postions listed • mandatory climate program (program) focus primary greenhouse gas – carbon dioxide (CO2) • Offsets important program especially offsets support energy related objectives • program add natural gas costs residential small businesses • program designed reduce GHG emissions gradual phased technology driven approach reduce GHGs minimizing costs consumers • program allow greater access natural gas resources avoid restrictions use natural gas promote development necessary infrastructure • program tailor strategies various sectors depending degree contribution solution nation’ s GHG levels • Allowances distributed affected sections/companies fully minimize adverse business impact asset value program administration costs • program needs address critical nation energy objectives boost clean generation (short long term) grid reliability specifically described NiSource’ s core regulated operating companies continue pursue variety solutions manage GHG risks opportunities include improved gas leak performance improved combustion efficiency projects EPA recognized number natural gas conservation projects Natural Gas Star program (resulting reduction 780 000 tonnes CO2eq 1993) selected NiSource transmission distribution companies Partner Year addition NIPSCO process seeking regulatory approval biomass fuel blend permit generating fleet NIPSCO conducted test DOE demonstrate potential use 3% biomass renewable fuel replace coal 500 MWs generation 3% biomass blend result approximately 80 000 ton year reduction CO2 NiSource joined U S Environmental Protection Agency’ s Climate Leaders program manage risks GHG emissions emitted operations identify cost effective reduction opportunities Climate Leaders program includes 1) Development corporate wide GHG inventory 6 major GHGs report progress annually based detailed EPA protocols guidance 2) Development corporate GHG Inventory Management Plan based detailed EPA checklist institutionalize inventory process and3) Setting aggressive corporate wide GHG emissions reduction goal achieved 10 years EPA works closely company program review GHG inventory Inventory Management Plan provide guidance setting aggressive GHG emissions reduction goal goals announced EPA Climate Leaders program analyzed ensure significantly better business usual approved EPA senior management

 
<>Would like provide additional information relating question provided
 No 

 
Section A – 2 Greenhouse Gas Emissions Accounting
Question 2(a)(i) – Methodology – Accounting Year
<>Please state accounting year used report GHG emissions
Financial accounting year 31 December 2006

 
<>Would like provide additional information relating question provided
 Yes 
NiSource completed initial enterprise wide GHG emissions inventory calendar year 2003 inventory completed 2005 submitted EPA Climate Leaders Partnership updated inventory 2006 shown Section 2b NiSource calculates corporate wide emissions using Climate Leaders GHG Inventory Guidance defines Partners working EPA inventory report GHG emissions Guidance based existing GHG Protocol Corporate Accounting Reporting Standard developed World Resources Institute World Business Council Sustainable Development

 
Question 2(a)(ii) – Methodology
<>Please state methodology emissions calculated
 GHG Protocol 

 
<>Please provide additional information
NiSource companies report emissions WRI control approach including Scope 1 Scope 2 identified Scope 3 emissions NiSource companies report nearly 100% GHG emissions produced operations control include Scope 3 emissions related purchased power parties meet customer demand purpose reporting GHG emissions control defined ability introduce implement operational policy having operational control having majority entity NiSource businesses respective facilities U S based major GHGs considered inclusion emissions inventory Given nature operations following included emissions inventory carbon dioxide (CO2) nitrous oxide (N2O) methane (CH4) natural gas transmission storage distribution facilities CO2 N2O CH4 electric generating plants sulfur hexafluoride (SF6) electric power distribution operation

 
<>Please state reporting boundaries data provided questionnaire
Option 2 – entities company exercises control

 
<>Please provide additional information

 
<>Would like provide additional information relating question provided
 No 

 
Question 2(a)(iii) – Methodology – External verficiation
<>Please state information provided externally verified audited
 Yes 
Inventory Management Plan (IMP) prepared serve guiding principle assure complete emissions inventory maintained time IMP prepared party implementation partner CH2M Hill Climate Leaders’ guidance WBCSD/WRI GHG Protocol consistent general energy sector practices Partnership program data submitted EPA 2006 desktop review inventories assure accuracy completeness technical soundness addition internal QA/QC peer review process Finally NiSource hired party gas sector greenhouse gas expert refine review inventory process geared achieving higher level accuracy inventory scheduled completed 2007 EPA Climate Leaders program continually reviews emissions inventory data GHG emission reduction goal progress addition EPA provides technical assistance determining organizational operational boundaries identifying appropriate emission factors documenting decisions IMP ensure consistency transparency inventory time EPA performs desktop reviews inventory data IMP ensure meet EPA’ s quality standards conducts risk based site IMP review ensure IMP implemented facility level reviews generally reflect level examined party verification provide reasonable assurance EPA implemented GHG data collection management place

 
<>Would like provide additional information relating question provided
 No 

 
Question 2(a)(iv) – Methodology – Variations emissions
<>Please provide explanation significant variations emissions year year major acquisitions divestments introduction new technologies
significant variations existing NiSource GHG emissions profile 2001 base year directly indirectly related • mothballing D H Mitchell Generation Station 525 MW coal fired electric generating facility • development increased utilization Whiting Clean Energy facility (a NiSource subsidiary) Whiting Clean Energy developed highly efficient large natural gas fired combined heat power facility facility produce power approximately half carbon intensity traditional coal fired power plant • increase purchased power lower carbon intensityCombined activities contributed approximately 14 9 % reduction greenhouse gas intensity electric segment Notably 2003 NiSource divested approximately 1000 MW lower carbon intensity generation sold Primary Energy subsidiary operations significantly improved overall GHG emission rate NiSource consistent Climate Leaders control inventory approach impacts included year year emissions profile divested (even continue operate provide low carbon intensity power Northwest Indiana)

 
<>Would like provide additional information relating question provided
 No 

 
Question 2(b) – Scope 1 Scope 2 GHG Protocol Year 1 answers
state direct indirect GHG emissions metric tonnes CO2e global Annex B countries having difficulty reporting emissions figures CO2e metric tonnes guidance answering CDP5 questionnaire available
<>Please enter accounting year used report GHG emissions details
31 December 2006

 
<>Total Global Emissions
<>21755000 CO2e metric tonnes

 
<>Total Emissions Annex B countries
<>0 operations Annex B countries

 
<>Scope 1 activity emissions globally
<>21510000 CO2e metric tonnes

 
<>Scope 1 activity emissions Annex B
<>0 operations Annex B countries

 
<>Scope 2 activity emissions globally
<>245000 CO2e metric tonnes

 
<>Scope 2 activity emissions Annex B
<>0 operations Annex B countries

 
<>Please state MWh electricity purchased consumed company globally
389 MWh

 
<>Please state MWh electricity purchased consumed company Annex B countries
0 MWh

 
<>Please state percentage purchased consumed MWh electricity renewables globally
4 %

 
<>Please state percentage purchased consumed MWh electricity renewables Annex B countries
0 %

 
<>Would like provide additional information relating question provided
 Yes 
NiSource 2006 Emissions Inventory Summary (expressed tonnes CO2 equivalent) NiSource Business Sector CO2 GHG Footprint – Percent Total Natural Gas Transmission Storage 3 426 000 15 7 % Natural Gas Distribution 1 208 000 5 6 % Electric Generation 16 771 000 77 1 % SF6 105 000 0 5 % Indirect Emissions Sources 245 000 1 1 % TOTAL EMISSIONS SCOPE 1 2 21 755 000 100 %

 
Question 2(c) – Scope 3 GHG Protocol Year 1 answers
<>Please enter accounting year used report GHG emissions details
31 December 2006

 
<>If possible provide estimates metric tonnes CO2e following categories emissions Use/disposal company’ s products services
<>1324000 CO2e metric tonnes

 
<>Your supply chain
<>Considered minimis

 
<>External distribution/logisitics
<>Considered minimis

 
<>Employee business travel
<>Considered minimis

 
<>Other
<>See Scope 3 estimates purchase power meet customer demand

 
<>Please provide details sources emissions entered figure "Other" box

 
<>Please provide information measurement scope 3 emissions
NiSource accounts GHG emissions intensity metric determination associated purchased power parties meet customer demand better track account influence cleaner power purchases customers 2006 GHG emissions associated party purchases customer use 1 324 000 tonnes CO2 equivalents addition national electric power sector accounts nearly 35% nation’ s GHG footprint end use emissions associated electricity minimal customer choice demand greatly contribute national goal reduce GHG emissions sector meeting demand reduced carbon intensity wise use natural gas power generation dramatically improve nation’ s GHG profile consistent climate change strategies NiSource intends promote role clean highly efficient generation serve achieving nation’ s energy environmental objectives including regulatory frameworks favor efficiency converting fuel energy products natural gas conservation trackers provide incentives promote customer usage efficiency Accordingly NiSource climate change strategy uses customer efficiency metrics measure goal reducing customer GHG emissions metric intensity based account additional usage lower carbon intensive energy products key component national GHG solution following chart illustrative ratio customer related emissions compare internal emissions related transmission distribution natural gas NiSource’ s entire customer GHG footprint approximately times larger NiSource’ s internal natural gas footprint highlights environmental benefits achieved natural gas energy efficiency

 
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Section B – 3 Additional Greenhouse Gas Emissions Accounting
Question 3(a) – Scope 1 Scope 2 GHG Protocol emissions country
Using methodology set 2(a) state emissions country NB practical list emissions country country basis list countries significant emissions context business combine remainder “ rest world” information format (e g Excel) attach
<>
Country Scope 1
Emissions (Tonnes CO2e)
Scope 2
Emissions (Tonnes CO2e)
USA 21510000 245000

 
<>Would like provide additional information relating question provided
 No 

 
Question 3(b) – Facilities covered EU Emissions Trading Scheme
provide details total emissions metric tonnes CO2e facilities covered EU ETS details allowances issued applicable National Allocation Plans
<>Emissions total facilities covered EU ETS figure metric tonnes CO2e
0 metric tonnes CO2e

 
<>Total number allowances issued National Allocation Plans applicable installations covered EU ETS
0 metric tonnes CO2e

 
<>Would like provide additional information relating question provided
 No 

 
Question 3(c) – EU ETS impact
<>What impact profitability EU Emissions Trading Scheme
NiSource’ s CO2 emissions covered EU emissions Trading Scheme trading systems

 
<>Would like provide additional information relating question provided
 No 

 
Section B – 4 Greenhouse Gas Emissions Management
Question 4(a)(i) Reduction programmes
emission reduction programs does company place include reduction programs related operations energy consumption supply chain product use/disposal
<>Does company emissions reduction program
 Yes 

 
<>What baseline year emissions reduction program (YYYY format 1990)
2001

 
<>If use baseline year reduction programme provide details reference point programme
NiSource uses baseline year 2001

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(a)(ii) Reduction programmes
emissions reduction targets period targets extend
<>Emissions reductions target (%)
7 %

 
<>Time frame reduction target
2012

 
<>Further information
NiSource met EPA Climate Leader representatives November 2005 purpose discussing GHG reduction strategy meeting NiSource proposed working improve NiSource companies’ customers’ energy efficiency 7% 2001 2012 Total benefits NiSource’ s efforts anticipated reduce GHG emissions approximately 1 9 million tons CO2 equivalent 2012 projected emissions

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(a)(iii) Reduction programmes
<>What investment been/will required achieve targets (In $)

 
<>Over time period (In years)
11

 
<>More
described emissions reduction opportunities require capital personnel resource investment NiSource investment included 2007 budget anticipated future budgets anticipated NiSource achieves objectives result 7+% reduction GHG intensity NiSource operating footprint natural gas customers addition 3% biomass blend approximately double renewable power generated NIPSCO annually NiSource track publicly communicate progress meeting GHG emissions reduction goals review quality reductions commitment Electric ProductionProposed Emission Reduction OpportunitiesThe bulk capital investment reduction opportunities electric business following bullets summarize key opportunities undertaken • Heat Rate Improvement (capital intensive projects designed improve unit electric generation efficiency including turbine control upgrade condenser tube replacements cooling tower upgrade feed water heater upgrade air heater basket replacement ) • Generating station output/closing utilization new external power including efficient gas fired combined heat power generation replace older efficient coal fired generation lost plant shutdown • Electric steam turbine replacement projects dense pack configuration • Neural net artificial intelligence installations learn improve operation electric generation unit emissions efficiency profiles • 3% biomass fuel blend 500 MWs generation and• Purchase lower GHG intensity power Natural Gas Transmission StorageProposed Emissions Reduction OpportunitiesNiSource companies active participant USEPA Natural Gas Star program 1993 result participation NiSource continue invest programs reduce GHG emissions NiSource implemented following emission reduction programs • Directed inspection maintenance compressor stations metering stations • Identification rehabilitation programs reduce pipeline leakage • Identification replacement high bleed pneumatic devices • Installation excess flow valves • Reduction pressure needed • Installation lower emitting turbines compressor stations • Installation flares dehydration units • Installation electric motors natural gas compression • Use clock spring repairs reduce leakage • Replacement compressor wet seals dry seals • Use ultrasonic meters better identify fix leaks • Relocation gates reduce lost natural gas • Reduction natural gas loss compressor shutdown • Redesign blowdown emergency shutdown practices • Use fixed portable compressors pipeline pump downs • Installation electric starters • Rerouting glycol skimmer gas and• Capture methane liquids tanks

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(a)(iv) Reduction programmes
<>What emissions reductions associated costs savings achieved date result program
Total NiSource GHG Intensity ImprovementsUsing inventory weighting methodology weights individual business segment’ s GHG intensity improvement based percentage segment’ s total contribution inventory NiSource improved GHG intensity date 13 1% Total NiSource Customer GHG Intensity ImprovementsNiSource’ s residential commercial customer GHG intensity improved considerably number factors including price natural gas improved technology energy efficiency programs 2001 GHG intensity improvement approximately 10%

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(a)(v) Reduction programmes
<>What renewable energy energy efficiency activities undertaking manage emissions
described NiSource does anticipate changing asset uses GHG emissions reduction opportunity strategy example NIPSCO seeking regulatory approval implement fuel blend change use 3% biomass replace coal 500 MWs generation percent biomass blend double NIPSCO’ s current renewable generation result approximately 80 000 tons year reduction CO2 Additionally NiSource begun transitioning generation assets sustainable profile NIPSCO ceased operating coal fired generating stations D H Mitchell electric generating station ceased operations late 2001 NIPSCO securing cleaner external power commitments and/or internal generation NiSource NET subsidiary continue play role furthering DG CHP technologies national transformation sustainable lower carbon intensive footprint technologies improve generation efficiency NiSource committed promoting inside outside electric service territory NiSource Bay State Gas subsidiary partner development Brockton Brightfield Project install 425 kW solar power convert idle brownfield site productive revenue generating asset solar array largest New England largest brightfield nationwide generate 535 megawatt hours electricity year carbon free – power 70 homes respect existing renewable generation NiSource currently operates hydroelectric plants combined generating capacity nearly 16 5 megawatts plants government sponsored price support mechanism

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(b) Emissions trading
company’ s strategy trading EU Emissions Trading Scheme CDM/JI projects trading systems (e g CCX RGGI etc) relevant Explain involvement following
<>EU ETS
applicable NiSource operations U S based

 
<>CDM/JI
applicable NiSource operations U S based

 
<>CCX
NiSource participated original development CCX currently participating

 
<>RGGI
NiSource affected RGGI allocation format

 
<>Others
applicable

 
<>More
NiSource’ s CO2 emissions covered EU emissions Trading Scheme trading systems NiSource did participate design stage Chicago Climate Exchange (CCX) NiSource supports concept CDM/JI advance mandatory GHG program example NiSource CDM/JI partner fuel switching project involves converting lignite coal natural gas Decin Czech Republic gaining additional experience participating trading programs Clean Air Act useful NiSource focused urging clean generation energy efficiency cornerstone policies trading program achieve sustainable GHG reductions example letter CCX December 2 2002 NiSource explained importance incorporating significant role lower carbon intensive power generation “ discussed design phase CCX does provide components recognize role supply energy efficiency projects play achieve greenhouse gas reductions Increasing energy efficiency including new generation technology practical solution generation achieve desired results incorporation significant role new energy efficient generation technology CCX missing necessary component ” NiSource participated Regional Greenhouse Gas Initiative (RGGI) urge northeast states recognize generation efficiency incorporate significant role clean generation including smaller highly efficient site generation conserve natural resources reduce GHG emissions NiSource’ s internal emissions reduction opportunities produce emissions allowances banked future use sold cap trade program example NiSource proposing RGGI states recognize methane reduction projects offset projects mandatory cap trade program NiSource actively participating projects develop additional offset protocols trading programs intent utilize protocols establish elements necessary validate natural gas transmission storage reductions turn fosters incentive identify implement reduction projects sources advantage trading opportunities market participation Overall NiSource actively working assure promulgated trading programs recognize role natural gas solving nation’ s GHG issues focus sectors effectively address GHG reductions integrate global response interim NiSource continue monitor advocate projects increase efficiency converting fuel useful energy products recognized climate registries climate trading programs

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(c) Emissions intensity
state measurement believe best describes company’ s emissions intensity performance historical current emissions intensity measurements targets
<>Best measurement emissions intensity company
NiSource uses weighted inventory emissions intensity measure progress inventory broken subcomponent metrics relate 3 main emission types 1) electric power generation (tonnes CO2eq/megawatt hour) 2) natural gas combustion (tonnes CO2 eq/brake horsepower hour) 3) vented fugitive methane (tonness CO2 eq/miles pipe)

 
<>Historical intensity details
NiSource implemented numerous projects improve GHG intensity

 
<>Current intensity details
discussed question 4a 2001 base year NiSource improved GHG intensity 13% (as 2006) ahead internal goal 7% year 2012

 
<>Target details

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(d) Energy costs
total costs energy consumption e g fossil fuels electric power percentage total operating costs does represent
<>Total costs energy consumption (in US$)
462000000 US$

 
<>Percentage total operating costs (%)
21 %

 
<>More Details
NIPSCO purchases fossil fuel vast majority electric generation cost fuel passed customers Fuel Adjustment Clause Energy consumption normal building lighting heating minimus portion operating budgets

 
<>Would like provide additional information relating question provided
 No 

 
Question 4(e) Planning
estimate company’ s future emissions provide details estimates summarize methodology factor cost future emissions capital expenditure planning considerations impact investment decisions
<>Do estimate company’ s future emissions
 Yes 

 
<>Please provide details estimates summarize methodology provide details estimate company's future emissions
company does estimate future emissions directly related energy demand operating subsidiaries utilize various modeling programs estimate future demand various scenarios future emission estimates function estimated demand minus intensity/efficiency improvements planned 2012 previously stated company’ s goal equates 7% improvement GHG intensity

 
<>How factor cost future emissions capital expenditure planning
NiSource committed growth strategy expand transmission storage natural gas fossil fuel lowest carbon intensity addition NiSource incorporating GHG emissions capital expenditure planning (see 4aii list projects implemented proposed implemented)

 
<>Have considerations impact investment decisions
 Yes 

 
<>Please provide details
considerations impacted investment decisions NiSource believes natural gas fossil fuel lowest carbon intensity key contributor helping nation meet energy needs reduce domestic GHG emissions Accordingly NiSource factored future emissions gas assets relative higher carbon intensive energy alternatives projected vast majority NiSource’ s future capital expenditures projections business growth new gas transmission storage assets

 
<>Would like provide additional information relating question provided
 No 

 
Section B – 5 Climate Change Governance - Responsibility
Question 5(a)(i) Responsibility
<>Which Board Committee executive body overall responsibility climate change
early 1990’ s NiSource established Board level committee Board Directors meets twice annually address environmental matters including climate change primary function Committee assist Board Directors management overall EH& S program oversight meeting Senior Vice President Environmental Counsel presents information existing emerging EH& S matters including climate change April 2004 Committee reviewed approved NiSource Climate Change Policy reads follows Environmental Health Safety Climate Change PolicyWhereas economic social environmental values considerations integrated NiSource business activities climate change issue considerable debate concern NiSource companies engage activities reduce potential risks pursue opportunities associated climate change issue Consistent Environmental Health Safety Policy NiSource intends reduce carbon intensity operations provide products solution reducing nation's greenhouse gas emissions Accordingly NiSource meet energy needs customers address global climate change challenges business activity compatible sustained economic growth ends NiSource effective efficient ways • Inventory greenhouse gas emissions relevant NiSource companies' operations • Increase efficiency NiSource companies generate transport distribute energy products • Reduce carbon intensity energy products • Promote role clean highly efficient generation serve achieving nation's energy environmental objectives • Advocate power generation projects increase efficiency converting fuel useful energy products recognized climate registries environmental regulations • Encourage customers use natural gas wisely including using highly efficient site energy systems combined heat power • Develop objectives targets advance NiSource customer efforts meet positions • Measure progress NiSource customers making meeting positions 2007 board level committee reviewed approved NiSource’ s positions climate change legislation

 
<>Would like provide additional information relating question provided
 No 

 
Question 5(a)(ii) Responsibility
<>What mechanism Board executive body reviews company’ s progress status regarding climate change
Consistent Security Exchange Commission requirements NiSource internal review report climate change risks opportunities example quarterly annual reports 1995 NiSource submitted annual reports Department Energy virtually climate related activity NiSource companies Additionally EH& S Department establishes targets objectives reports progress various environmental activities highlighted report titled Sustainable Approach report attempts summarize enterprise wide initiatives embody concepts corporate social responsibility report available NiSource EH& S Department addition NiSource engaged variety stakeholders participating various climate related forums including Global Roundtable Climate Change CERES Investor Dialogue resulted public reports

 
<>Would like provide additional information relating question provided
 No 

 
Question 5(b) Individual performance
<>Do provide incentive mechanisms managers reference activities relating climate change strategy including attainment GHG targets
 Yes 

 
<>If provide details
NiSource’ s corporate wide Performance Management Process accomplishments NiSource leaders evaluated annually relative range general specific performance expectations expectations linked company’ s overall goals objectives reflect individual’ s position role organization process includes evaluations mangers position role makes responsible activities relating NiSource’ s climate change strategy including attainment GHG targets appropriate GHG related performance goals included individual Performance Management Worksheets (or PMWs) used Performance Management Process incentive achieve individual performance objectives leaders (and employees) participate NiSource’ s Corporate Incentive Plan provides annual monetary incentives linked corporate individual performance achievements Individual performance factor consideration base pay decisiosn promotion career advancement considerations

 
<>Would like provide additional information relating question provided
 No 

 
General Information
<>Please add general information attachments related specific question like include response
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