latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/path-to-net-zero-70-of-biggest-us-utilities-have-deep-decarbonization-targets-61622651 content esgSubNav
In This List

Path to net zero: 70% of biggest US utilities have deep decarbonization targets


Infographic: The Big Picture 2024 – Energy Transition Outlook


The Big Picture: 2024 Energy Transition Industry Outlook

Case Study

An Oil and Gas Company's Roadmap for Strategic Insights in a Quickly Evolving Regulatory Landscape


Essential IR Insights Newsletter Fall - 2023

Path to net zero: 70% of biggest US utilities have deep decarbonization targets

Most major U.S. electric and gas utilities now have net-zero emissions or equivalent targets, an indication that an increasing share of the industry is making long-term plans for deep decarbonization even as the COVID-19 pandemic has cast a shadow on the broader economy.

Path to net zero
How some of the biggest companies in energy and metals and mining are moving to decarbonize their footprints. Please click on the story links below to read more of our coverage.

Overview: Momentum builds for energy transition as oil, gas pledges grow

Utilities: 70% of the biggest US utilities have deep decarbonization targets

Oil and gas: Climate change takes center stage at more US oil companies

Mining: More mining companies setting targets to reduce emissions


As of Dec. 4, 21, or 70%, of the 30 largest U.S. electric and gas utilities had net-zero equivalent targets or were moving to comply with a similarly aggressive state mandate, according to a review of utilities' plans by S&P Global Market Intelligence.

LISTEN: Click here to hear exclusive interviews on the S&P Global podcast Energy Evolution in which executives from two of the largest North American pipeline operators that recently set net-zero emissions targets, Enbridge Inc. and Williams Companies, Inc., outline their path forward.

Since July 28, eight utilities have added or expanded their net-zero targets. WEC Energy Group, Inc., Entergy Corp., Ameren Corp., FirstEnergy Corp., AES Corp. and Vistra Corp. announced plans to achieve net-zero emissions by 2050.

For natural gas-related emissions, Dominion Energy Inc. moved up its timeline for achieving net-zero CO2-equivalent emissions for its gas operations to 2040, a decade ahead of its companywide target. Duke Energy Corp. tweaked its net-zero target to include net-zero methane emissions from its gas utility business by 2030.

Many of the largest U.S. utilities have been under pressure from investors seeking to ensure the companies are positioned to perform well financially amid climate-related transitional and physical risks. While many utilities are setting aggressive targets, most of them are also counting on major advances in related technologies — such as carbon capture and sequestration, advanced nuclear reactors, green hydrogen, longer-lasting battery storage, and carbon offset credits — to achieve their ambitious goals.

Amid all of this investor pressure, utilities are also grappling with the economic and customer-side usage impacts of COVID-19. Rather than drive attention away from climate change, the pandemic has heightened investor attention on the risks of climate change, said Dan Bakal, senior director of electric power at the sustainability-focused group Ceres. Ceres is also the coordinator behind the Climate Action 100+ investor initiative.

SNL Image

If any companies were thinking that climate change is "a fringe [environmental, social and governance] issue, it's becoming increasingly clear that a substantial portion of their shareholder base really wants to understand how they're managing climate and closing the gaps that they have in their alignment with the deep decarbonization goals that science demands," Bakal said in an interview.

The pandemic, as well as the aggressive climate campaign pledges of U.S. President-elect Joe Biden, has also shown companies need to rethink the long-term need for gas as a bridge fuel, S&P Global Ratings wrote in a couple of research papers published in September.

During the pandemic, "the U.S. power and utility sector has been largely resilient, but companies need to adjust strategies," Ratings wrote. "This is because we project gas-fired generation to peak in 2020 in view of the continuous shift to renewables, which could accelerate in case of a Biden win and his plan for a carbon-free power sector in 2035."

About the data

The list of the top 30 largest utilities by market cap has changed slightly since July. PG&E Corp. was added after it exited bankruptcy, which resulted in UGI Corporation being bumped off the list.

Market Intelligence also tweaked its methodology regarding whether a utility is deemed to have a net-zero target or equivalent goal for the purposes of this analysis.

Under the revised methodology, if a utility operates in a state with a net-zero equivalent mandate and has outlined plans for achieving the state's requirement, the utility is counted as having a net-zero equivalent target. As a result, PG&E Corp., Edison International and Sempra Energy, which are subject to and have described plans to meet California's mandate to achieve carbon-free electricity by 2045, are listed in the chart as having a net-zero target. However, some utilities listed as not having a net-zero target operate in states that have a net-zero equivalent target.