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Baker Hughes, a GE Company - Climate Change 2019
C0. Introduction
C0.1
(C0.1) Give a general description and introduction to your organization.
On July 3, 2017, Baker Hughes and GE Oil & Gas merged into a new company, Baker Hughes, a GE company (BHGE). Please notethe scope of this questionnaire includes BHGE operations for both calendar and fiscal year 2018 for Scope 1, Scope 2, and Scope 3emissions.
We are the only fullstream provider of integrated oilfield products, services and digital solutions with a presence in more than 120countries. We strive to provide best-in-class physical and digital technology solutions for customer productivity, leveragingcomplementary technologies to serve customers across the full spectrum of the oil and gas value chain. We believe that there arestructural changes taking place in the oil and gas industry that require a change in how we work. No matter the oil price, ourcustomers are looking for new models and solutions to deliver higher industrial yield, which means improving productivity andefficiency and leveraging economies of scale, with lower carbon impact. While we will continue to serve customers on a project basis,our fullstream portfolio, digital capabilities and leading technology and services will enable us to shift towards outcome-focusedsolutions, enabling customers to lower capital and operating costs, reduce non-productive time and boost resource recovery.
Reliable and affordable energy is a critical building block for any modern society, and without it, sustainable economic growth will beimpossible. Energy is essential, and the scientific consensus is that fossil fuels used to generate electricity and power transportationemit amounts of carbon dioxide that are contributing to climate change. BHGE supports policies that promote both lower carbonemissions and sustainable economic growth. Policies and regulations to help reduce carbon emissions are essential to drivetechnology development and deployment. Fairness to consumers, environmental integrity, cost-effectiveness, sound science andtechnology neutrality should be the guiding principles for arriving at any national strategy.
C0.2
(C0.2) State the start and end date of the year for which you are reporting data.
Start date End date Indicate if you are providing emissions data for pastreporting years
Select the number of past reporting years you will be providingemissions data for
Row1
January 12018
December 312018
No <Not Applicable>
C0.3
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(C0.3) Select the countries/regions for which you will be supplying data.AlbaniaAlgeriaAngolaArgentinaAustraliaAustriaAzerbaijanBelgiumBolivia (Plurinational State of)BrazilCameroonCanadaChinaColombiaEcuadorEgyptEquatorial GuineaFranceGabonGermanyGhanaHungaryIndiaIndonesiaIraqIrelandItalyJapanKazakhstanKenyaKuwaitLebanonMexicoMozambiqueNetherlandsNigeriaNorwayOmanPakistanPhilippinesPolandQatarRepublic of KoreaRomaniaRussian FederationSaudi ArabiaSenegalSingaporeSlovakiaSouth AfricaSpainSwedenSwitzerlandTaiwan, Greater ChinaThailandTrinidad and TobagoTurkeyUgandaUnited Arab EmiratesUnited Kingdom of Great Britain and Northern IrelandUnited States of AmericaVenezuela (Bolivarian Republic of)
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C0.4
(C0.4) Select the currency used for all financial information disclosed throughout your response.USD
C0.5
(C0.5) Select the option that describes the reporting boundary for which climate-related impacts on your business are beingreported. Note that this option should align with your consolidation approach to your Scope 1 and Scope 2 greenhouse gasinventory.Operational control
C1. Governance
C1.1
(C1.1) Is there board-level oversight of climate-related issues within your organization?Yes
C1.1a
(C1.1a) Identify the position(s) (do not include any names) of the individual(s) on the board with responsibility for climate-related issues.
Position ofindividual(s)
Please explain
Other C-SuiteOfficer
The Chief Health, Safety, Environment, Quality, and Security Officer reports directly to the Chairman and Chief Executive Officer. This Officerprovides periodic updates to the Governance and Nominating Committee and to the entire Board of Directors on Health Safety, Environment,Quality and Security challenges, risks, milestones & metrics, strategies and highlights of success on a variety of topics, including carbonemissions, climate change and sustainability.
Other, pleasespecify (TheGovernance andNominatingCommittee)
The Governance and Nominating Committee is formally responsible for sustainability, including the risks associated with climate change. Acopy of the Governance and Nominating Committee charter may be viewed at the following link, http://investors.bhge.com/corporate-governance/documents-charters
C1.1b
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(C1.1b) Provide further details on the board’s oversight of climate-related issues.
Frequencywith whichclimate-relatedissues are ascheduledagenda item
Governancemechanisms intowhich climate-related issuesare integrated
Please explain
Scheduled –somemeetings
Reviewing andguiding strategyReviewing andguiding majorplans of actionReviewing andguiding riskmanagementpoliciesReviewing andguiding annualbudgetsReviewing andguiding businessplansSettingperformanceobjectivesMonitoringimplementationand performanceof objectivesOverseeing majorcapitalexpenditures,acquisitions anddivestituresMonitoring andoverseeingprogress againstgoals and targetsfor addressingclimate-relatedissues
Our annual report for 2018 discusses our strategy which includes helping customers improve productivity and efficiency andleverage economies of scale to deliver a higher industrial yield, with lower carbon impact. Because lowering the carbon footprintfor BHGE and delivering lower carbon solutions to our customers is embedded in our strategy, it flows through our policies,capital allocation plans and performance objectives. The strategic goals outlined in our 2019 Proxy Statement make up 30% ofthe short-term bonus payout for our executives. These strategic blueprint goals include HSE metrics as well as metrics relatedto our strategy.
C1.2
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(C1.2) Provide the highest management-level position(s) or committee(s) with responsibility for climate-related issues.
Name of theposition(s)and/orcommittee(s)
Responsibility Frequencyofreportingto theboard onclimate-relatedissues
Other, pleasespecify (ChiefHealth,Safety,Environment,Quality, andSecurityOfficer )
Both assessing and managing climate-related risks and opportunities Quarterly
Other, pleasespecify(GlobalEnvironment&SustainabilityDirector)Full Title isGlobalEnvironmental&SustainabilityDirector
Both assessing and managing climate-related risks and opportunitiesThe Global Environmental and Sustainability Director is responsible for evaluating risks related to climate change, and for managingthe overall greenhouse gas (GHG) program and reports directly to the Executive Vice President of Health, Safety, and Environment.This individual along with the Environmental & Sustainability Group develops principles and tools, initiates action for continuousimprovement. They are responsible for monitoring trends, proposing mitigation strategies and improvement goals, and reportingperformance data both internally and externally. This includes the annual compilation of the GHG inventory and quality assurancereview of the data. Various Managers and Directors within the company are responsible for maintaining the data necessary to completethe inventory and subsequent updates.
Quarterly
Riskcommittee
Assessing climate-related risks and opportunities Annually
C1.2a
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(C1.2a) Describe where in the organizational structure this/these position(s) and/or committees lie, what their associatedresponsibilities are, and how climate-related issues are monitored (do not include the names of individuals).
Risk Committee: The BHGE Risk Management responsibility lies within the company's Security group and oversees the EnterpriseRisk Management (ERM) process working in collaboration across the global BHGE Leadership of the company. The Enterprise RiskManagement process addresses: 1) Transition risks including legal compliance e.g., cap and trade schemes, emissions reportingobligations and fuel/energy taxes. 2) Physical risks including effects of climate change e.g., potential for weather-related damage toassets and disruption to operations and supply chain. 3) Other risks e.g., geographical, political, security of supply, potential financialimpacts and reputational. The process also identifies opportunities for the sale of new products and services. At an enterprise level,monitoring and evaluating business risk is conducted annually with the Board of Directors oversight and review and as importantmatters arise.
Material issues that are identified through the ERM process are prioritized based on the degree of financial impact that a risk oropportunity presents to the organization. For example, a risk may have the potential for disruption to business or require significantcapital expenditure. An opportunity may have the potential for significant revenue generation. Examples of opportunities from climatechange legislation include carbon capture and storage, geothermal drilling operations, the conversion of diesel vehicles andequipment to natural gas, and the supply of chemicals that reduce emissions from diesel fuel.
HSE, Quality and Security Executive Leadership Team (ELT): The Corporate HSEQS ELT is led by the Chief Health, Safety,Environment, Quality and Security Officer and includes Senior Executives from each product company and functional area. TheGlobal Environment & Sustainability Director along with the Corporate Environmental Team, monitors and reports the status of ourenergy and greenhouse gas reduction goals on a routine basis. Progress on goals and targets are reported quarterly to the HSEQSELT, the Enterprise Executive Leadership Team (ELT) and board of directors and our performance is published annually to externalstakeholders (investors, clients and the general public). In addition, locations that have regulatory emissions reporting requirementsreport to their local authority annually.
Annual performance results for company energy efficiency and greenhouse gas emission reduction goals are compiled in theEnvironmental, Social, and Governance report and presented to the Chief Health, Safety, Environment, Quality, and Security Officer,the Executive Leadership Team (including our CEO), and the Board of Directors. This report is available to the public through ourexternal website: https://my.bhge.com/smarter-together/taking-energy-forward-responsibly
Low Carbon Strategy Team: In 2018, a low carbon strategy working group was formed to evaluate opportunities for reducingcarbon within the company's operations and across the entire oil and gas supply chain. The group includes senior executives and vicepresidents within Market & Technology; Environment and Sustainability leads within HSE; and Government, Community, and IndustryRelations, Communications teams, and many others. The group works to reduce BHGE’s carbon footprint and our customers’ carbonfootprints, as well as identify opportunities to expand into clean energy solutions. Specific teams now include the Energy Transitionand Clean Energy Solutions team, technology teams within product companies, and a variety of cross functional teams. Informationis reported regularly to the Board of Directors and as important matters arise.
Since 2010, BHGE (formerly Baker Hughes) has worked to reduce energy use and minimize our carbon footprint through a robustenergy management program structured to identify and implement energy efficiency and conservation measures applicable to ourfacilities and operations.
C1.3
(C1.3) Do you provide incentives for the management of climate-related issues, including the attainment of targets?Yes
C1.3a
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(C1.3a) Provide further details on the incentives provided for the management of climate-related issues (do not include thenames of individuals).
Who is entitled to benefit from these incentives?Other C-Suite Officer
Types of incentivesMonetary reward
Activity incentivizedEmissions reduction target
CommentEnergy and Emission Reduction Projects and Targets: The Chief Health, Safety, Environment, Quality, and Security Officer hasgoals related to (1) carbon emissions reductions commitment and targets, (2) meeting environmental goals and sustainabilityobjectives and (3) external reporting and communication including disclosures to customers, investors, and other stakeholders.
Who is entitled to benefit from these incentives?Environment/Sustainability manager
Types of incentivesMonetary reward
Activity incentivizedEmissions reduction target
CommentEnergy and Emission Reduction Projects and Targets: The Global Environment and Sustainability Director has individual goalsrelated to (1) carbon emissions reductions commitment and targets, (2) energy efficiency and conservation strategies, projects, andprogress, (3) meeting environmental goals and sustainability objectives and (4) external reporting and communication includingdisclosures to customers, investors, and sustainability surveys including CDP and others.
Who is entitled to benefit from these incentives?Other, please specify (Health, Safety & Environment function)
Types of incentivesMonetary reward
Activity incentivizedEnergy reduction target
CommentCarbon Emissions Reduction Target: Various personnel throughout the organization have HSE goals as part of their IncentiveCompensation Plan. These goals may include the 2018 environmental goals including our carbon reduction commitment, energyefficiency projects, and reporting depending on their specific area of responsibility.
Who is entitled to benefit from these incentives?All employees
Types of incentivesMonetary reward
Activity incentivizedEmissions reduction target
CommentThe Chairman’s HSE Excellence Award is the most prestigious and coveted HSE recognition. This award recognize employeeteams for HSE achievements that include performance against targets for reduction in energy use and GHG emissions. During2018, 5 teams were selected from 85 nominees. Each winning team receives $10,000, which can be used per recognition programguidelines. Most locations typically make donations to local charities and/or educational programs within their communities.
Who is entitled to benefit from these incentives?All employees
Types of incentivesRecognition (non-monetary)
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Activity incentivizedEmissions reduction target
CommentThe President's HSE Recognition Awards are the most significant and impressive award bestowed by our product companyleaders. This award recognize teams that achieve exceptional performance against established criteria, including significant HSEachievements, which can include energy efficiency and GHG emission projects and results. During 2018, 15 teams wererecognized from over 100 nominees. BHGE teams that have taken action to reduce energy use and emissions through product /service design or through behavioral changes are recognized on a routine basis through various internal systems (i.e., newsletters,performance reports, yammer, etc.) to all employees. Top performing teams are often recognized by senior executives andmanagers during leadership visits and informal meetings.
C2. Risks and opportunities
C2.1
(C2.1) Describe what your organization considers to be short-, medium- and long-term horizons.
From(years)
To(years)
Comment
Short-term
0 5 We have established a broad range of pathways to achieve our short term energy efficiency and GHG reduction goals. These includethe following broad categories: Facility Operational Improvements: identifying opportunities through energy treasure hunts andimplementing energy efficiency projects; Facility Construction, Renovation and Retrofits: Using Sustainable Building Standards andEnergy Efficient Equipment; Transportation: optimizing scheduling and logistics, minimizing vehicle idling, and evaluating fleetconversion to low emission models; Renewable Energy Sourcing: increasing the use of renewables in utility contracts and onsite powergeneration; Tool and Equipment Design: using lifecycle analysis to quantify emissions from our products and services and reduceenergy use. A key component of the short-term strategy is to continue to raise employee awareness of our bold low carbon commitmentand how they can contribute to success. We do this through a variety of communication campaigns, including sharing best practicesand success stories. Our internal 2018 goal of a 10% reduction in GHG’s at our operating facilities allows our employees to takeownership of their carbon footprint both in and out of the workplace.
Medium-term
5 10 BHGE medium-term strategy is to fully-integrate energy efficiency and climate change mitigation measures into all aspects of ourbusiness planning and risk management process. This entails implementing systematic approaches to carbon emissions reductions forour direct operations as well as the development and redesign of products and services. This will enable us to meet our mid-term targetof 50% reduction in carbon emissions by 2030. In the mid-term, we expect to have new energy solutions within our product portfolio,and leverage new technologies. We aim to integrate energy efficiency into all our major new projects and to promote energy efficiencywithin our operations to maximize return on investment and reduce our environmental impacts. For our direct operations, this is largelybased on energy reduction projects at our locations to reduce resource usage and emissions as well as new construction projectsbased on sustainable building standards. By retrofitting older locations to meet new sustainability standards as well as new constructiondesigned to be more eco-friendly throughout its lifecycle, energy and emission savings are realized both short and long term. a. Wecontinue to implement our Energy Management Standard (an operational control procedure in our HSE management system) in ourmanufacturing and large scale operational facilities. This procedure aligns with the ISO 50001 standard for identifying significant energysources and implementing measures to effectively reduce energy use. b. We expect to expand our energy efficiency measures acrossour portfolio to ensure energy efficiency measures are in place broadly and consistently across our operations. c. We expectrenewables to comprise a large percentage of our energy use.
Long-term
10 30 Ultimately, our long-term strategy is to maintain our top-tier status with regard to climate change performance. Specifically, we have seta target to achieve net-zero Scope 1 and 2 carbon equivalent emissions by 2050, which is aligned with the 1.5 degree United NationsIntergovernmental Panel on Climate Change recommendations. We also would like to help our customers reduce their carbon footprintsthrough our products and services. Efforts to reduce energy consumption and use renewable and alternative forms of energy are savingBHGE money through decreased utility costs and maintaining compliance with climate change regulations. In addition, we are realizingnew business opportunities through our efficiency-enhancing oilfield equipment and services, methane emissions monitoring technology,carbon capture and storage, and geothermal drilling, among other solutions. These position BHGE as the partner of choice whencustomers are making decisions based on criteria and policies set forth in the Paris and Kyoto agreements.
C2.2
(C2.2) Select the option that best describes how your organization's processes for identifying, assessing, and managingclimate-related issues are integrated into your overall risk management.Integrated into multi-disciplinary company-wide risk identification, assessment, and management processes
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C2.2a
(C2.2a) Select the options that best describe your organization's frequency and time horizon for identifying and assessingclimate-related risks.
Frequencyofmonitoring
How far intothe futureare risksconsidered?
Comment
Row1
Six-monthlyor morefrequently
>6 years The BHGE Enterprise Risk Management process addresses risks including: 1) Legal compliance e.g., cap and trade schemes,emissions reporting obligations and fuel/energy taxes. 2) Physical effects of climate change e.g., potential for weather-relateddamage to assets and disruption to operations and supply chain. 3) Other risks e.g., geographical, political, security of supply andpotential financial impacts. The process also identifies opportunities for the sale of new products and services. At an enterpriselevel, monitoring and evaluating business risk is conducted annually. The corporate Environmental group monitors and reports thestatus of our energy and greenhouse gas (GHG) reduction goals on a routine basis. We report quarterly to the Executive Teamand Board of Directors and publish our performance annually to external stakeholders (investors, customers, and the generalpublic). In addition, locations that have regulatory emissions reporting requirements report annually.
C2.2b
(C2.2b) Provide further details on your organization’s process(es) for identifying and assessing climate-related risks.
In order to align with the market, meet customer needs, and remain competitive in our industry BHGE has adopted a strategy basedon the need to conduct business in a manner that protects people, assets, intellectual property, and the environment.
Our strategy is influenced by climate change risks and informed by:
1. Analysis of environmental impacts inherent with our business, including climate change risks and the energy transition.
2. At least semi-annual meetings of Governance and Nominating Committee to review Health, Safety and Environmentalperformance and compliance and review any regulatory issues or trends that may materially affect business operations or company’sreputation. This includes an evaluation of risks, including business, reputational and other risks, and progress towards our lowcarbon commitments and environmental goals.
3. Quarterly executive steering committee reviews on the operationalization of our energy transition strategy.
4. Sustainability performance benchmarking against peers and customers, including views beyond our industry related to climatechange risks and the energy transition.
5. Tracking and analysis of energy use and associated GHG emissions at the majority of our locations to identify gaps and areas forimprovement.
6. Discussion and disclosure of risks through the company annual report (10K) available at: https://investors.bhge.com/financial-information/annual-reports and through our BHGE Corporate Responsibility report (Environmental, Social and Governance) availableat https://my.bhge.com/smarter-together/taking-energy-forward-responsibly
7. Reporting of risks and climate change commitments and mitigation strategies through CDP and other sustainability surveys.
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C2.2c
(C2.2c) Which of the following risk types are considered in your organization's climate-related risk assessments?
Relevance&inclusion
Please explain
Currentregulation
Relevant,alwaysincluded
An example is our monitoring of the implementation of the Paris Accord, whose provisions impact signatory countries through theirrespective nationally determined contributions (NDCs) of emissions reductions. These NDCs will in turn impact our customers’ operationswithin each signatory country, and therefore BHGE’s business.
Emergingregulation
Relevant,alwaysincluded
An example is our ongoing monitoring of potential carbon taxation in various jurisdictions around the world.
Technology Relevant,alwaysincluded
BHGE provides fullstream technology solutions that help energy companies develop energy safely and more efficiently while reducingthe carbon footprint of their operations. Our technologies span the entire hydrocarbon lifecycle -- upstream, midstream and downstream -- from exploration through refining. Additionally, within BHGE’s operations, we continually strive to lower our own carbon footprint byimproving the energy efficiency within our facilities and equipment and minimizing waste in our manufacturing processes. Furtherexample is our ongoing monitoring of the prevalence of electric vehicles, which in turn impacts petroleum demand and, therefore, thedemand for BHGE’s products and services.
Legal Relevant,alwaysincluded
An example is our ongoing monitoring of litigation against oil and gas companies alleging that such companies are directly or indirectlyresponsible for the climate-related effects of the extraction, processing, and use of petroleum.
Market Relevant,alwaysincluded
BHGE provides fullstream technology solutions that help energy companies develop energy safely and more efficiently while reducingthe carbon footprint of their operations. Our technologies span the entire hydrocarbon lifecycle -- upstream, midstream and downstream -- from exploration through refining. Additionally, within BHGE’s operations, we continually strive to lower our own carbon footprint byimproving the energy efficiency within our facilities and equipment and minimizing waste in our manufacturing processes. Furtherexample is our ongoing monitoring of the prevalence of electric vehicles, which in turn impacts petroleum demand and, therefore, thedemand for BHGE’s products and services.
Reputation Relevant,alwaysincluded
One example is our ongoing monitoring of social license to operate around the world. We recognize reputational risks and this informs ouroverall sustainability approach and commitment to transparency.
Acutephysical
Relevant,alwaysincluded
One example is our incorporation of the risks of extreme weather events in decisions of where to locate key company assets such asdata centers. This also includes the development of contingency plans and crisis management strategies.
Chronicphysical
Relevant,alwaysincluded
One example is our incorporation of the risks of rising sea levels when deciding where to locate a new BHGE facility, relative to thecurrent coastline.
Upstream Relevant,alwaysincluded
One example is our work with suppliers to ensure that they have business continuation plans in case of climate-related disruptions.
Downstream Relevant,sometimesincluded
One example is our ongoing discussions of the potential impacts of climate change with our customers, the ways that BHGE can helpquantify and lower customers’ emissions, and positioning BHGE as the provider of choice for reduced-emissions solutions.
C2.2d
(C2.2d) Describe your process(es) for managing climate-related risks and opportunities.
BHGE manages climate related risks through the Enterprise Risk Management (ERM) Process. The ERM process is managed byBHGE's Chief Security Officer and is reported to the board’s Audit Committee and Governance & Nominating Committee, both ofwhich are responsible for monitoring and auditing risk management performance. Each year, the BHGE Leadership Team, whichincludes representatives for the different functions and geographical regions within the organization document the risks in theirbusiness function, risk trends, the drivers (both internal and external), what measures are currently in place to measure and mitigaterisk, and then opportunities for improvement. The assessment process includes questionnaires, in-person interviews andpresentations, and the outcome is reported to executive management. The Global Environmental and Sustainability Director hasresponsibility for evaluating and communicating climate change risk, with a primary focus on regulatory developments, potentialimpacts and mitigation strategies.
At an asset level, the environmental risks from our operations, including climate change risks are identified through standardprocesses that comprise the BHGE health, safety and environmental management system. These procedures are mandated for ouremployees and contractors. The element “HSE Risks and Impacts” documents the process by which environmental aspects are
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identified and the potential impact is given a score based upon the severity of potential consequences and the likelihood it will occur.If the risk score falls into the high or medium categories, additional control measures must be identified and implemented. We alsogarner input to this process through engagement with stakeholders including industry peers to ensure a broad perspective.
Prioritization of risks and opportunities:
At the enterprise level, material issues that are identified through the Enterprise Risk Management (ERM) process are prioritizedthrough our enterprise-wide strategic planning process based on the degree of financial impact that a risk or opportunity presents tothe organization. For example, a risk may have the potential for disruption to business or require significant capital expenditure. Anopportunity may have the potential for significant revenue generation. Examples of opportunities from climate change legislationinclude carbon capture and storage, geothermal drilling operations, the conversion of diesel vehicles and equipment to natural gas,among other solutions. Our Energy Transition Steering Committee also prioritizes risks and opportunities on a more regular basis, atleast quarterly.
At an asset level, environmental aspects are identified through risk and impact assessments. The potential impact is given a scorebased upon the severity of potential consequences and the likelihood it will occur. The higher the score, the higher the priority toimplement mitigation measures or implement an opportunity for improvement. The process to identify significant energy sources andrecommended reduction opportunities at our large facilities is a requirement in the enterprise-wide standard operating procedure"Energy Management".
Case studies or examples of how the process has been applied to at least one transition risk and one physical risk are includedbelow:
Transition Risk: An example of the process applied to transition risk is through our commitments in industry collaboration. This isaccomplished through associations that engage with policy makers on legislation intended to reduce greenhouse gas emissions. Thisinvolves participation in technical roundtables, peer review of publications, and disclosures to customers, investors and the generalpublic. We’ve been engaged with the International Oil and Gas Producer’s Association (IOGP) and IPIECA for the past 10 years injoint industry working groups addressing climate change issues. And, when IPIECA (formerly called the International PetroleumIndustry Environmental Conservation Association) formally opened membership to oilfield services companies in 2016, we were oneof the first to join. We are proud and inspired by our work with our industry partners to make a difference.
Physical Risk: This includes severe weather events such as storms, flooding, and droughts, which could potentially generatematerial changes in our business operations, revenue, and costs. Managing these risks provides continuity for our direct operations,and also our supply chain. These such events are monitored through our Crisis Management Team on a 24/7 basis when weatherrelated events are approaching and during such events. To further reduce the risks associated with extreme weather conditions, thelocation of new facilities relative to the current coastline is incorporated into the risk management process. For example, our EnergyInnovation Center is located in Oklahoma City, OK and our main data centers were relocated away from coastal areas.
C2.3
(C2.3) Have you identified any inherent climate-related risks with the potential to have a substantive financial or strategicimpact on your business?Yes
C2.3a
(C2.3a) Provide details of risks identified with the potential to have a substantive financial or strategic impact on yourbusiness.
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IdentifierRisk 1
Where in the value chain does the risk driver occur?Direct operations
Risk typeTransition risk
Primary climate-related risk driverPolicy and legal: Exposure to litigation
Type of financial impact<Not Applicable>
Company- specific descriptionCompliance with, and rulings and litigation in connection with, environmental regulations and the environmental impacts of our orour customers’ operations may adversely affect our business and operating results. We and our business are impacted by materialchanges in environmental laws, regulations, rulings and litigation. Our expectations regarding our compliance with environmentallaws and regulations and our expenditures to comply with environmental laws and regulations, including (without limitation) ourcapital expenditures for environmental control equipment, are only our forecasts regarding these matters. These forecasts may besubstantially different from actual results, which may be affected by factors such as: changes in law that impose restrictions on airemissions including greenhouse gases linked to climate change.
Time horizonCurrent
LikelihoodUnknown
Magnitude of impactUnknown
Are you able to provide a potential financial impact figure?No, we do not have this figure
Potential financial impact figure (currency)<Not Applicable>
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureImpact not quantified financially given wide range of possible outcomes and uncertain likelihood and magnitude of impact of each
Management methodSeveral groups within BHGE monitor environmental rulings and litigation on an ongoing basis. Management discusses theirpotential and actual impact on our and our customers' businesses and develops strategies to mitigate these risks.
Cost of management0
CommentCost of management is not material, therefore no value is given.
IdentifierRisk 2
Where in the value chain does the risk driver occur?Direct operations
Risk typeTransition risk
Primary climate-related risk driverPolicy and legal: Enhanced emissions-reporting obligations
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Type of financial impact<Not Applicable>
Company- specific descriptionInternational, national, and state governments and agencies continue to evaluate and promulgate legislation and regulations thatare focused on restricting emissions commonly referred to as greenhouse gas (GHG) emissions. In the United States, the U.S.Environmental Protection Agency (EPA) has taken steps to regulate GHG emissions as air pollutants under the U.S. Clean Air Actof 1970, as amended. The EPA’s Greenhouse Gas Reporting Rule requires monitoring and reporting of GHG emissions from,among others, certain mobile and stationary GHG emission sources in the oil and natural gas industry, which in turn may includedata from certain of our wellsite equipment and operations. In addition, the U.S. government has proposed rules in the past settingGHG emission standards for, or otherwise aimed at reducing GHG emissions from, the oil and natural gas industry. Caps oncarbon emissions, including in the United States, have been and may continue to be established and the cost of such caps coulddisproportionately affect the fossil-fuel energy sector. We are unable to predict whether the proposed changes in laws orregulations ultimately will occur or what they ultimately will require, and accordingly, we are unable to assess the potential financialor operational impact they may have on our business. Other developments focused on restricting GHG emissions include theUnited Nations Framework Convention on Climate Change, which includes the Paris Agreement and the Kyoto Protocol; theEuropean Union Emission Trading System; the United Kingdom’s Carbon Reduction Commitment (CRC) Energy Efficiency andESOS schemes; and, in the United States, the Regional Greenhouse Gas Initiative, the Western Climate Action Initiative, andvarious state programs implementing the California Global Warming Solutions Act of 2006 (known as Assembly Bill 32).
Time horizonCurrent
LikelihoodUnknown
Magnitude of impactUnknown
Are you able to provide a potential financial impact figure?Yes, an estimated range
Potential financial impact figure (currency)<Not Applicable>
Potential financial impact figure – minimum (currency)700000
Potential financial impact figure – maximum (currency)1500000
Explanation of financial impact figureImpact quantified financially based on 2018 figures for the purchase of carbon credits under the UK CRC program and the cost ofreporting requirements. Also included is the cost of managing requirements for the European Union Energy Efficiency Directive,Article 8 and associated energy audits. The costs for monitoring the changes in regulations globally that could potentially impactour operations are also included.
Management methodBHGE maintains compliance with existing regulations and reports emissions for permitted facilities required to report. In the UK, weare obligated to report under the Carbon Reduction Commitment. This requires that we report our energy and carbon footprint tothe authorities, retain auditable records, pay for CO2 emissions through the purchase of carbon allowances, implement energyreduction schemes, benchmark our performance against other businesses and submit figures annually for the assessment ofallowances for the following year. The European Union Energy Efficiency Directive, Article 8 establishes a baseline threshold andfrequency for countries in the EU to follow. In 2018 BHGE prepared a strategy and cost projections to meet the auditing requirementset forth in Article 8 which includes establishing a list of countries that are in scope and determining location that meet countryspecific requirements for energy audits. We also follow greenhouse gas (GHG) emission reporting requirements in other countriesincluding Canada, Australia and Brazil, among others. BHGE reports enterprise-wide GHG emissions in accordance with aninternal reporting policy and plan. We utilize a third party to validate the calculation and reporting procedure.
Cost of management700000
CommentIn 2018 BHGE invested $1.7MM in a comprehensive HSE software suite, which includes an emissions management programcalled EcoInventory. The annual cost for staff time to manage the emissions reporting and verification is approximately $150,000 to$250,000. For the UK, our compliance costs are just under $500,000.
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IdentifierRisk 3
Where in the value chain does the risk driver occur?Direct operations
Risk typeTransition risk
Primary climate-related risk driverMarket: Changing customer behavior
Type of financial impact<Not Applicable>
Company- specific descriptionCurrent or future legislation, regulations and developments, including those related to climate change, may curtail production anddemand for hydrocarbons such as oil and natural gas in areas of the world where our customers operate, by shifting demandtowards relatively lower carbon energy sources such as wind, solar and other renewables. Many governments are providing taxadvantages and other subsidies and promoting technological research to support renewable energy sources, or are mandating theuse of renewable fuels or technologies. These governmental initiatives, as well as increased societal awareness of climate changeimpacts, have also resulted in increased investor and consumer demand for renewable energy. Any resulting reduction in demandfor oil and natural gas could adversely affect future demand for our services and products, which may in turn adversely affect futureresults of operations.
Time horizonShort-term
LikelihoodLikely
Magnitude of impactUnknown
Are you able to provide a potential financial impact figure?No, we do not have this figure
Potential financial impact figure (currency)<Not Applicable>
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureImpact not quantified financially given wide range of possible outcomes and uncertain magnitude of impact of each
Management methodBHGE continues to develop innovative solutions that help reduce our oil and gas customers' carbon footprints by avoidingemissions, thereby helping to improve the relative carbon footprint of oil and gas compared to non-oil and gas energy sources. Seeexamples of such solutions in section C 4.5. In addition, as our customers diversify their businesses by investing in non-oil and gasbusinesses such as renewables, we are also investigating the potential for such diversification.
Cost of management700000000
Comment2018 total BHGE R and D spend was $700MM as indicated in our Annual Report. Costs are dispersed across various groups withinBHGE (e.g. research and development, product management, strategy and marketing) and are not broken out separately.
C2.4
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(C2.4) Have you identified any climate-related opportunities with the potential to have a substantive financial or strategicimpact on your business?Yes
C2.4a
(C2.4a) Provide details of opportunities identified with the potential to have a substantive financial or strategic impact onyour business.
IdentifierOpp1
Where in the value chain does the opportunity occur?Customer
Opportunity typeProducts and services
Primary climate-related opportunity driverDevelopment and/or expansion of low emission goods and services
Type of financial impactIncreased revenue through demand for lower emissions products and services
Company-specific descriptionBHGE continues to develop innovative solutions that help reduce our oil and gas customers' carbon footprints by avoidingemissions, thereby helping to improve the relative carbon footprint of oil and gas compared to non-oil and gas energy sources. Seeexamples of such solutions in section C 4.5.
Time horizonCurrent
LikelihoodVirtually certain
Magnitude of impactUnknown
Are you able to provide a potential financial impact figure?No, we do not have this figure
Potential financial impact figure (currency)<Not Applicable>
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureImpact not quantified financially given wide range of possible outcomes and uncertain magnitude of impact of each at this time.
Strategy to realize opportunityWe are investing to develop a variety of new solutions to complement our existing portfolio of low carbon solutions. To demonstratethe ability of our solutions to reduce our customers' carbon footprints, we have quantified their emissions avoidance impact from acustomer use standpoint. For certain solutions, we are conducting comparative life cycle emissions assessments to certify carbonfootprint reductions per ISO 14067 standards. Finally, we are using life cycle assessments to identify and prioritize further efforts toreduce carbon footprint in the design of both existing and new products and services, making them even more carbon competitive.
Cost to realize opportunity700000000
Comment2018 total BHGE R and D spend was $700 MM as indicated in our Annual Report. Costs to develop and market lower emissionsproducts and services are dispersed across various groups within BHGE (e.g. research and development, product management,strategy and marketing) and are not broken out separately.
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IdentifierOpp2
Where in the value chain does the opportunity occur?Direct operations
Opportunity typeResource efficiency
Primary climate-related opportunity driverMove to more efficient buildings
Type of financial impactReduced operating costs (e.g., through efficiency gains and cost reductions)
Company-specific descriptionIncreased energy prices, as well as an opportunity to reduce our carbon footprint, drove the implementation of sustainable buildingstandards. Energy-efficiency projects included lighting retrofits and the installation of the natural gas fuel cell at our facility inShafter, California. The cost of energy generated by the fuel cell is significantly less than purchasing electricity. This fuel cell hasoperated for 6 years and its potential expansion is under review.
Time horizonCurrent
LikelihoodVirtually certain
Magnitude of impactLow
Are you able to provide a potential financial impact figure?Yes, a single figure estimate
Potential financial impact figure (currency)941413
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureThese projects provide a cost saving from electricity usage and several federal and state incentives. This value is the estimatedannual savings from operating the Shafter fuel cell, as well as the combined estimated savings from sustainable building standardsin construction projects, LED, HVAC, and building automation installations.
Strategy to realize opportunityBHGE developed a robust screening tool to identify whether more environmentally sound and cost effective options were availableto meet facility energy needs. The alternate energy generation assessment tool assisted planners in determining the feasibility ofinstalling co-generation and/or self-generation to provide electrical power at company owned facilities. This tool provides significantadvantages over the traditional approach of engineering studies, which are often time consuming and expensive. The toolevaluates various factors to compare utility provided power to other options including fuel cells, photovoltaic, and natural gasturbines. The power supply types are evaluated against a number of criteria including feasibility, energy quality, greenhouse gasemissions, cost, payback period and other factors.
Cost to realize opportunity2000000
CommentBHGE invested $1.8MM in in energy efficiency aspects of new buildings and modifications. Costs for lighting retrofits, HVACupgrades, and BAS installations range between $3.5 K to $1 MM.
IdentifierOpp3
Where in the value chain does the opportunity occur?Direct operations
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Opportunity typeResilience
Primary climate-related opportunity driverParticipation in renewable energy programs and adoption of energy-efficiency measures
Type of financial impactIncreased market valuation through resilience planning (e.g., infrastructure, land, buildings)
Company-specific descriptionBHGE, then Baker Hughes, entered into an agreement with Walpole Solar Farm, LLC, for the development of a 4.75 MWrenewable solar energy project on a brownfield property. This has been an ideal reuse program, benefiting Baker Hughes, WalpoleSolar Farm, New England Electric and the local community of Walpole.
Time horizonCurrent
LikelihoodVirtually certain
Magnitude of impactLow
Are you able to provide a potential financial impact figure?Yes, a single figure estimate
Potential financial impact figure (currency)2000000
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureRevenue of more than $2 MM is generated for the solar lease at Walpole.
Strategy to realize opportunityBHGE partnered with Soltage, a renewable energy provided, in recent years to develop a solar farm on a brownfield site as part ofour commitment to create sustainable energy development and our goal of reducing greenhouse gases. Construction of theWalpole Solar Project is on 25 acres at a former industrial manufacturing plant owned by BHGE. The solar panels are constructedwithin an un-forested area of the footprint of the former manufacturing building. The surrounding ecosystem was not disturbedincluding the valuable tree species (i.e., the Atlantic White Cedar, home for protected species of moth).
Cost to realize opportunity300000
CommentRevenue of more than $2 MM is generated for the solar lease at Walpole.
IdentifierOpp4
Where in the value chain does the opportunity occur?Direct operations
Opportunity typeResilience
Primary climate-related opportunity driverOther
Type of financial impactIncreased market valuation through resilience planning (e.g., infrastructure, land, buildings)
Company-specific descriptionIncreasing attention paid to climate change, and our activities to mitigate risk through energy efficiency and a reduction ingreenhouse gas emissions, have provided us the opportunity to demonstrate that we are a good corporate citizen.
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Time horizonCurrent
LikelihoodVirtually certain
Magnitude of impactUnknown
Are you able to provide a potential financial impact figure?No, we do not have this figure
Potential financial impact figure (currency)<Not Applicable>
Potential financial impact figure – minimum (currency)<Not Applicable>
Potential financial impact figure – maximum (currency)<Not Applicable>
Explanation of financial impact figureDemonstrating our environmental and social responsibility efforts through investor ranking surveys brings BHGE to the attention ofpotential investment organizations. For example, passive investment occurs in firms that are listed on the Dow Jones SustainabilityIndex (DJSI).
Strategy to realize opportunityOur BHGE strategy involves a focus on transparency and alignment with recognized sustainability reporting standards such as theGlobal Reporting Initiative. Key components of our strategy include the following: a) BHGE participates in a number of investorsurveys and is keen to share our efforts with investors, customers and employees. b) Publication of performance, policies andrelated information on our environment, social, and governance programs on an external website (https://www.bhge.com/corporate-responsibility), which contains specific information on climate and energy (https://www.bhge.com/corporate-responsibility/planet/climate). c) We also publish our annual Corporate Responsibility report (https://my.bhge.com/smarter-together/taking-energy-forward-responsibly) as another means to provide current details on our success and challenges. Thiscomprehensive strategy enables us to reach out to many of our key stakeholders and aligns with our commitment to be transparentin our operations.
Cost to realize opportunity275000
CommentOverall, our corporate social responsibility efforts include energy reduction and community programs. In 2018, capital costs ofapproximately 1.8 million were directed to energy and water conservation projects including emission reduction. BHGE invested$2.2 million of company funding for the sponsorship of community events and charitable giving.
C2.5
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(C2.5) Describe where and how the identified risks and opportunities have impacted your business.
Impact Description
Productsandservices
Impacted As described in Table C2.3, BHGE faces the risk that current or future legislation, regulations and developments, including those related toclimate change, may curtail production and demand for hydrocarbons such as oil and natural gas in areas of the world where our customersoperate, by shifting demand towards relatively lower carbon energy sources such as wind, solar and other renewables. Many governmentsare providing tax advantages and other subsidies and promoting technological research to support renewable energy sources, or aremandating the use of renewable fuels or technologies. These governmental initiatives, as well as increased societal awareness of climatechange impacts, have also resulted in increased investor and consumer demand for renewable energy. Any resulting reduction in demandfor oil and natural gas could adversely affect future demand for our services and products, which may in turn adversely affect future resultsof operations. As described in Table C2.4, BHGE also has opportunities in the products and services it provides to customers. We continueto develop innovative solutions that help reduce our oil and gas customers' carbon footprints by avoiding emissions, thereby helping toimprove the relative carbon footprint of oil and gas compared to non-oil and gas energy sources. See examples of such solutions in TableC4.5.
Supplychainand/orvaluechain
Impactedfor somesuppliers,facilities,orproductlines
BHGE works with our suppliers to reduce interruptions due to all risks. This includes ensuring that major suppliers have business continuityplans. In addition, BHGE continually evaluates our facilities for opportunities to reduce emissions through energy efficiency improvements.
Adaptationandmitigationactivities
Impacted BHGE’s climate-related adaptation and mitigation activities include planning for potential sea level rise and extreme weather events andlocating facilities in lower-risk areas were possible. This included crisis management strategies and contingency plans in areas based onrisk. BHGE also designs its facilities to be able to cope with anticipated temperature increases. This includes scalable electrical and climatecontrol systems.
Investmentin R&D
Impacted Many governments are providing tax advantages and other subsidies and promoting technological research to support renewable energysources and a portion of BHGE’s research and development efforts are directed towards that area. In addition, BHGE’s research anddevelopment focuses on improving the efficiency of our customers’ operations, which has the effect of lowering their emissions.
Operations Impacted One of the ways BHGE reduces operational climate-related risk is by de-manning our wellsite operations and relocating personnel to remoteoperations centers reducing transportation requirements, saving fuel and eliminating some GHG emissions. BHGE also works to reduce thenumber of trucks sent to customer well sites and uses lower emissions forms of transportation when possible, for example rail instead oftruck.
Other,pleasespecify
Notevaluated
No response necessary.
C2.6
(C2.6) Describe where and how the identified risks and opportunities have been factored into your financial planningprocess.
Relevance Description
Revenues Impacted for somesuppliers, facilities,or product lines
As described in table C2.4, BHGE continues to develop innovative solutions that help reduce our oil and gas customers' carbonfootprints by avoiding emissions, thereby helping to improve the relative carbon footprint of oil and gas compared to non-oil andgas energy sources. See examples of such solutions in table C4.5.
Operatingcosts
Impacted for somesuppliers, facilities,or product lines
As described in table C2.4, BHGE has implemented various energy-efficiency projects at its facilities such as lighting retrofits,the installation of a natural gas fuel cell, and solar power. BHGE has also reduced the amount of fuel it uses for transportation.
Capitalexpenditures/ capitalallocation
Impacted for somesuppliers, facilities,or product lines
To grow revenues and reduce operating costs as described above, capital may need to be allocated, for example to developlow carbon technologies and solutions for our customers and to purchase energy efficiency systems.
Acquisitionsanddivestments
Impacted for somesuppliers, facilities,or product lines
We maintain a pipeline of potential acquisitions and divestments, aligned with our strategy, including our desire to help reduceour oil and gas customers' carbon footprints.
Access tocapital
Impacted for somesuppliers, facilities,or product lines
We monitor trends in the capital markets and are in regular contact with our investors, including on business opportunities andrisks related to climate change.
Assets Impacted for somesuppliers, facilities,or product lines
To grow revenues as described above, capital may need to be allocated, for example to develop assets such as new lowcarbon technologies. Also, as described in table C2.3, several groups within BHGE monitor environmental rulings and litigationon an ongoing basis for potential adverse impact on our and our customer's businesses and assets.
Liabilities Impacted for somesuppliers, facilities,or product lines
As described in table C2.3, several groups within BHGE including environmental and sustainability, legal and financial experts,monitor environmental rulings and litigation on an ongoing basis. Management discusses their potential adverse impact on ourand our customers' businesses.
Other Not evaluated No response necessary
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C3. Business Strategy
C3.1
(C3.1) Are climate-related issues integrated into your business strategy?Yes
C3.1a
(C3.1a) Does your organization use climate-related scenario analysis to inform your business strategy?Yes, qualitative
C3.1c
(C3.1c) Explain how climate-related issues are integrated into your business objectives and strategy.
BHGE manages our environmental footprint through sustainable innovations in operations and compliance with environmentalregulations. Our global environmental performance and sustainable efforts are bolstered by our HSE policy, goals, and keyperformance indicators (KPIs). We use certified HSE management systems to control operational implementation. We track ourenvironmental Key Performance Indicators (KPIs) daily, assessing them to identify trends and to drive further improvements.
We identify and manage inherent climate change risks. This includes severe weather events such as storms, flooding, and droughts,which could potentially generate material changes in our business operations, revenue, and costs. Managing these risks providescontinuity for our direct operations, and also our supply chain.
In 2018 we expanded our efforts to reduce energy, and associated greenhouse (GHG) emissions by 10%, through a series ofenvironmental actions with specific conservation targets. We achieved an overall reduction of 11%, calculated on a weighted averagebased on our use of electricity (40%), natural gas (40%), and water (20%). We measure our progress at our largest facilities using abroad spectrum of data management systems (including EcoInventory, GreenLink, EMIS, and ENGIE Insight).
These facilities represent more than 85% of the energy used across our global manufacturing and operations facilities. We continueto implement our Energy Management Standard (an operational control procedure in our HSE management system) in ourmanufacturing and large scale operational facilities. This procedure aligns with the ISO 50001 standard for identifying significantenergy sources and implementing measures to effectively reduce energy use. Additionally, in 2018 our Turbomachinery and ProcessSolutions (TPS) products aligned with the ISO 14000 standard for environmental management. This adds to our large, existingportfolio of sites certified to and/or aligned with the ISO 14001 Environmental Management System across our global operations.
BHGE is also interested in new business opportunities involving carbon capture and storage, geothermal drilling, and thedevelopment of chemicals that reduce emissions from diesel fuel used in transportation, among other opportunities. We believe thatexecuting in a more eco-friendly manner is a strategic advantage in a global economy where regulatory policies are becoming morerobust. In 2018, we began developing an enterprise low carbon strategy which continues our focus on reducing BHGE’s carbonfootprint and on providing solutions to reduce our customers’ carbon footprints.
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C3.1d
(C3.1d) Provide details of your organization’s use of climate-related scenario analysis.
Climate-relatedscenarios
Details
Pleaseselect
Over many years, BHGE has evaluated climate-related scenario analyses developed by IEA and considered this information in short and long termbusiness strategies. Now we are developing more detailed and specific scenario analyses. In February 2018 we developed a series of climate-relatedscenario analyses through 2040 called the BHGE 2040 Energy Transition Model. The model uses BP’s Even Faster Electric Vehicle (BP eFEV)scenario to analyze the overall energy mix (oil, gas, coal, nuclear, and renewables) through 2040, incorporating macroeconomic drivers, end user newtechnologies and market trends, projections for affected industries, analysts’ forecasts, and internal BHGE and GE inputs. BHGE analyzed over 20energy transition scenarios developed by the U.S. Energy Information Agency (EIA), International Energy Agency (IEA), World Economic Forum, IHS,McKinsey, Paris Climate Change Group, and others but decided to use the BP eFEV scenario given that it satisfies the goals of the Conference of theParties 21. We did not make any modifications to the BP eFEV scenario, which forecasts a deceleration in the growth of total energy demand as well asa change in the mix of fuel demand toward nuclear, hydro, and renewables, and away from fossil fuels. As part of the GE organization in 2018, BHGEwas included in GE's modelling across their global operations of GHG reductions scenarios as developed by the IEA and IPCC. GE used the "AbsoluteAllocation Approach” to model the expected emissions reduction contributions from selected operations consistent with the “below 2 degrees C”transition paths. Quantitative GE models estimate demand and growth scenarios of the world’s energy mix from extraction to consumption, includingsensitivity of market dynamics due to various inputs such as market responses to economic, regulatory and behavioral changes, and include outputssuch as the impact on global emissions.
C4. Targets and performance
C4.1
(C4.1) Did you have an emissions target that was active in the reporting year?Absolute target
C4.1a
(C4.1a) Provide details of your absolute emissions target(s) and progress made against those targets.
Target reference numberAbs 1
ScopeScope 1 +2 (market-based)
% emissions in Scope100
Targeted % reduction from base year10
Base year2017
Start year2018
Base year emissions covered by target (metric tons CO2e)706954
Target year2018
Is this a science-based target?No, but we are reporting another target that is science-based
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% of target achieved100
Target statusAchieved
Please explainAnnual Goal - Our 2018 annual environmental performance goal was a 10% reduction in absolute energy use and associatedgreenhouse gas emissions compared to previous year. We achieved an 11% reduction year over year, from 706,954 metric tonnesto 628,238 metric tonnes of CO2 equivalent.
Target reference numberAbs 2
ScopeScope 1 +2 (market-based)
% emissions in Scope100
Targeted % reduction from base year50
Base year2012
Start year2012
Base year emissions covered by target (metric tons CO2e)961000
Target year2030
Is this a science-based target?No, but we are reporting another target that is science-based
% of target achieved68
Target statusUnderway
Please explain2030 50% Reduction - This goal is in alignment with the Paris Accord and demonstrates BHGE's commitment to do our part tomitigate climate changes per the 1.5 degree scenario. We have achieved a 34% reduction in carbon emissions since 2012, whichis 68% of our 50% goal for 2030.
Target reference numberAbs 3
ScopeScope 1 +2 (market-based)
% emissions in Scope100
Targeted % reduction from base year100
Base year2012
Start year2012
Base year emissions covered by target (metric tons CO2e)961000
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Target year2050
Is this a science-based target?No, but we are reporting another target that is science-based
% of target achieved34
Target statusUnderway
Please explain2050 Net Zero - This goal is in alignment with the Paris Accord and demonstrates BHGE's commitment to do our part to mitigateclimate changes per the 1.5 degree scenario. We have reduced scope 1 and 2 carbon emissions 34% since 2012.
Target reference numberAbs 4
ScopeScope 1 +2 (market-based)
% emissions in Scope100
Targeted % reduction from base year17
Base year2012
Start year2016
Base year emissions covered by target (metric tons CO2e)961000
Target year2020
Is this a science-based target?Yes, we consider this a science-based target, but this target has not been approved as science-based by the Science-BasedTargets initiative
% of target achieved100
Target statusAchieved
Please explainScience- Based - A mid-range science-based target has been calculated utilizing the carbon target and profit calculator identified in"The 3% Solution: Driving Profits Through Carbon Reductions". Based on this calculation, our average annual percentageemissions reduction is 2.1% with a total % reduction of 17% by 2020. We have calculated this science-based target forinformational purposes to align our short-range goals to "The 3% Solution: Driving Profits Through Carbon Reductions". However,as a company we have decided on a bolder commitment which exceeds the science-based target. This bold commitment is toreduce carbon emissions 50% by 2030 compared to our 2012 baseline year and achieve net zero by 2050.
C4.2
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(C4.2) Provide details of other key climate-related targets not already reported in question C4.1/a/b.
TargetRenewable electricity consumption
KPI – Metric numerator100%
KPI – Metric denominator (intensity targets only)Not applicable, this is not an intensity target
Base year2014
Start year2015
Target year2018
KPI in baseline year16000
KPI in target year17762
% achieved in reporting year100
Target StatusAchieved
Please explainThis target involves energy consumption. In 2014, Baker Hughes undertook a new approach to electricity procurement for allUnited Kingdom facilities within Baker Hughes at that time. Four suppliers provided bids and the selection was based on stability ofsupply, pricing and environmental impacts. Electricity supply re tender was awarded to Dong Energy UK for 100% renewable poweron the purchase of electricity in 2015. DONG Energy, now Orsted, provides renewable energy certificates verifying the supply ofelectricity to 24 Baker Hughes UK facilities for actual consumption provided from renewable energy wind farms. The base yearenergy for energy type covered is 16000 MWh which is our electricity consumption for 2014. Our target for 2018 was 100%renewable power for these 24 facilities, which has been achieved.
Part of emissions targetThis is a separate energy consumption target from our absolute scope 1+2 targets.
Is this target part of an overarching initiative?Other, please specify (Internal BHGE initiative to increase the percentage of renewable energy procured across our globalportfolio.)
This is not a part of an overarching initiative but BHGE is evaluating other renewable usages (i.e., wind, solar, etc.) at otherlocations with either electricity providers or installation of our own systems to further reduce our GHG emissions.
C4.3
(C4.3) Did you have emissions reduction initiatives that were active within the reporting year? Note that this can includethose in the planning and/or implementation phases.Yes
C4.3a
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(C4.3a) Identify the total number of initiatives at each stage of development, and for those in the implementation stages, theestimated CO2e savings.
Number of initiatives Total estimated annual CO2e savings in metric tonnes CO2e (only for rows marked *)
Under investigation 10 70000
To be implemented* 6 35000
Implementation commenced* 6 35000
Implemented* 6 18013
Not to be implemented
C4.3b
(C4.3b) Provide details on the initiatives implemented in the reporting year in the table below.
Initiative typeEnergy efficiency: Building services
Description of initiativeLighting
Estimated annual CO2e savings (metric tonnes CO2e)2002
ScopeScope 2 (location-based)
Voluntary/MandatoryVoluntary
Annual monetary savings (unit currency – as specified in C0.4)300523
Investment required (unit currency – as specified in C0.4)75000
Payback period1-3 years
Estimated lifetime of the initiative11-15 years
CommentIn 2018, the retrofit and replacement for light fixtures at existing facilities were on-going with 33 projects. The replacement has beenbased on cost/benefit analysis taking into consideration the age and life cycle of existing equipment.
Initiative typeLow-carbon energy installation
Description of initiativeSolar PV
Estimated annual CO2e savings (metric tonnes CO2e)1908
ScopeScope 2 (location-based)
Voluntary/MandatoryVoluntary
Annual monetary savings (unit currency – as specified in C0.4)6480
Investment required (unit currency – as specified in C0.4)
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2375
Payback period<1 year
Estimated lifetime of the initiative16-20 years
CommentThree existing facilities commissioned solar arrays in 2018. Two sites installed rooftop solar panels and one location installedcarports outfitted with solar panels. Two of these installations were completed under a power purchase agreement (PPA), whichallows for the cost of installation and maintenance to be covered for an agreed upon term, typically 10 to 15 years. Efforts such asthese can produce significant savings or can be cost neutral, the economics are dependent on the electricity pricing in the area. Asa company we continue to investigate opportunities like these to help support our commitment to minimize our carbon footprint.
Initiative typeEnergy efficiency: Building fabric
Description of initiativeOther, please specify (Sustainable building construction specifications)
Estimated annual CO2e savings (metric tonnes CO2e)2112
ScopeScope 2 (location-based)
Voluntary/MandatoryVoluntary
Annual monetary savings (unit currency – as specified in C0.4)108390
Investment required (unit currency – as specified in C0.4)1800000
Payback period4 - 10 years
Estimated lifetime of the initiative11-15 years
CommentThe enterprise sustainable building construction specifications define energy efficient building materials and design which areincorporated into all new facilities and during upgrades to existing facilities. Our comprehensive design standards include naturaland energy-efficient lighting, energy efficient mechanical systems such as high efficiency boilers and heating plants, sustainableand locally sourced building materials and building architecture, design and placement to optimize energy efficiency such as fast-acting workshop doors. We also continue to use smart metering systems that monitor electricity, gas and water consumption at anumber of facilities in US, Canada, Brazil and the UK. Cost savings shown for 2018 represent projected electricity saved by usingthese standards in our construction projects this year.
Initiative typeOther, please specify (Facility Optimization)
Description of initiative<Not Applicable>
Estimated annual CO2e savings (metric tonnes CO2e)2877
ScopeScope 1
Voluntary/MandatoryVoluntary
Annual monetary savings (unit currency – as specified in C0.4)5850000
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Investment required (unit currency – as specified in C0.4)4500000
Payback period1-3 years
Estimated lifetime of the initiative>30 years
CommentFacility optimization efforts for 2018 involved consolidating and reducing our facility footprint by 73 facilities. This effort was acontinuation of BHGE effort to optimize our operations and address redundancies in locations across the organization. Scope 1reductions are based on the overall reduction in square footage and estimating the emissions utilizing region specific natural gasusage factors as the basis for CO2e emission calculations.
Initiative typeOther, please specify (Facility Optimization)
Description of initiative<Not Applicable>
Estimated annual CO2e savings (metric tonnes CO2e)9674
ScopeScope 2 (location-based)
Voluntary/MandatoryVoluntary
Annual monetary savings (unit currency – as specified in C0.4)5850000
Investment required (unit currency – as specified in C0.4)4500000
Payback period1-3 years
Estimated lifetime of the initiative>30 years
CommentFacility optimization efforts for 2018 involved consolidating and reducing our facility footprint by 73 facilities. This effort was acontinuation of BHGE effort to optimize our operations and address redundancies in locations across the organization. Scope 2reductions are based on the overall reduction in square footage and estimating the emissions utilizing region specific electricityusage factors as the basis for CO2e emission calculations.
C4.3c
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(C4.3c) What methods do you use to drive investment in emissions reduction activities?
Method Comment
Employee engagement BHGE established a Health, Safety, and Environment a (HSE) Policy Statement and enterprise-wide Environmental Goals. Thecommitment to energy reduction starts at the top and is stated in our HSE policy statement. Conservation efforts and steps to mitigategreenhouse gas emissions and climate change also align with our company purpose: to invent smarter ways to bring energy to the world.Our environmental commitments support the company’s business and sustainability objectives by conserving natural resources(environment) and reducing greenhouse gas emissions (environment and community). It also reduces operating cost (economic) anddrives the corporate motivation for investing in energy-efficient equipment and alternative clean energy sources.
Compliance withregulatoryrequirements/standards
BHGE locations that hold air emissions permits or are covered by a more general regulatory requirement e.g. UK Carbon ReductionCommitment must comply, and this may require investment. In addition, compliance with engine emission standards and associatedregulations.
Internal financemechanisms
Financial metrics are established for each business unit including a 50% operating cost reduction as outlined in our 50/50/50 businessstrategy. The reduction in energy consumption and costs is one established pathway to achieve the desired cost savings contributing to ahealthy bottom line.
Internalincentives/recognitionprograms
BHGE annual HSE awards program recognizes facility teams that have demonstrated sustained and superior HSE performance andattain a significant health, safety or environmental achievement. Environmental improvement projects focused on energy conservation orenergy efficiency are included in the application and scoring criteria. Increasingly, teams are documenting environmental achievementsincluding significant reductions in energy consumption and fuel usage in ways that are often innovative. Winning teams receive a trophyand also win $10,000 to spend on a prize of their choice.
Other (Policies andProcedures)
Internal company standards. BHGE has established policies and standards that guide investment in emissions-reduction technologies.These include the BHGE Climate Policy, the Energy Management operational control procedure, and the Sustainable Building Standards.Refer to the new BHGE Climate Policy here: https://www.bhge.com/reporting-policies#policies.
Other (ExternalFinancial Drivers)
External financial drivers. Tax incentives contribute significantly to our decision to invest in alternative energy sources such as the naturalgas fuel cell at our facility in Shafter, California. Other projects with potential tax incentives include solar installations, combined heat andpower technologies, commuter solutions (i.e. vanpools), and others.
C4.5
(C4.5) Do you classify any of your existing goods and/or services as low-carbon products or do they enable a third party toavoid GHG emissions?Yes
C4.5a
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(C4.5a) Provide details of your products and/or services that you classify as low-carbon products or that enable a third partyto avoid GHG emissions.
Level of aggregationCompany-wide
Description of product/Group of productsA core pillar of Baker Hughes' energy transition strategy is to reduce our customers' carbon footprints through emissions-reducingproducts and services. Our solutions reduce emissions from combustion, venting, fugitives, and flaring, and span the up-, mid-, anddown-stream portions of the energy value chain. Key emissions reduction levers incorporated into our solutions include: substitutingtoward less-emissive energy sources by using natural gas and renewables-generated electricity rather than diesel to powerequipment; improving speed of service delivery and energy efficiency of products used at our customers' sites; redesigning toolsand equipment to reduce energy consumption through less emissive and lower quantities of materials and more efficientmanufacturing processes; capturing, using, and/or storing carbon; improving reliability to reduce the need for well interventions andequipment repairs; extending the life of wells by improving recovery per well, and effectively plugging and abandoning /decommissioning wells to prevent fugitive methane emissions. Examples of BHGE's emissions reduction solutions include:geothermal drilling services; oil and gas drilling optimization through use of our TerrAdapt drill bit, AutoTrak rotary steerablesystem, Navi-Drill motor, water-based drilling fluids, VisiTrak and LithoTrak logging-while-drilling systems, and JewelSuite reservoirmodeling software; completions optimization through use of our DEEPFRAC multi-stage stimulation of offshore wells and ourSPECTRE frac plug; production optimization through use of our Magnefficient permanent magnet motor electric submersible pump,ProductionLink remote production monitoring service, and Intellistream production optimization suite; electric fracturing using ourLM2500 turbine; LUMEN Terrain and LUMEN Sky methane monitoring system; SENTRYNET chemical monitoring and automationsolution; modular gas processing solution; flare.IQ flare optimization system; Integrated Compressor Line; LM9000 gas turbine;NovaLT gas turbine; ORegen waste heat recovery system for gas turbines; Becker Zero-Bleed valve systems; Aptara subsea treeand remote monitoring systems (e.g., Beacon Centers). In addition, we are developing several emissions avoiding technologiesincluding: Intercept modular CO2 capture system and NovaLT16 hydrogen turbine which will operate on 100% hydrogen.
Are these low-carbon product(s) or do they enable avoided emissions?Avoided emissions
Taxonomy, project or methodology used to classify product(s) as low-carbon or to calculate avoided emissionsOther, please specify (unknown)
% revenue from low carbon product(s) in the reporting year
CommentOur emissions reducing products and services encompass both emissions that are avoided through the use of our products andservices by our customers ("avoided emissions") as well as emissions embedded in the products themselves ("low-carbonproduct"). Both types of emissions reductions are valued by our customers who have made public carbon reduction commitments.The absolute and relative magnitudes of avoided and embedded emissions will vary by product and we are in the process ofapplying both our own internal methodology and ISO standard 14067 (carbon footprint of products) to quantify both types ofemissions over the product life cycle. Life cycle assessment results in conformance with ISO 14067 will be certified by a third-partycritical reviewer. Examples of quantified emissions reductions include: modular gas processing at Nassiriya and Al Gharraf oilfieldsin Iraq will recover 200 million standard cubic feet per day of flare gas, reducing emissions by 5.7 million metric tons per year ofCO2 equivalent. An additional net 3.9 million metric tons of CO2 eq. emissions reductions are possible annually if incrementalpower generation is fueled by natural gas, displacing oil; the LM9000 gas turbine delivers a 50 percent longer maintenanceinterval, 20 percent more power and 40 percent lower NOx emissions, resulting in 20 percent lower cost of ownership for LNGcustomers; the Integrated (offshore) Compressor Line operates with zero emissions; flare.IQ allows refineries and petrochemicalplants to reduce flaring-related emissions by up to 12,100 metric tons of CO2 equivalent per flare annually. If deployed globally,flare.iQ could reduce annual emissions by 190 million metric tons of CO2 eq.; Intercept modular CO2 capture reduces emissionsby 16,200 metric tons of CO2 equivalent annually per 4 engine pad or 60 percent compared to the no-capture scenario. In addition,because CO2 is captured near the well site, emissions are avoided from not having to transport liquid CO2 from a remote locationto the well site.
C5. Emissions methodology
C5.1
CDP Page of 5729
(C5.1) Provide your base year and base year emissions (Scopes 1 and 2).
Scope 1
Base year startJanuary 1 2012
Base year endDecember 31 2012
Base year emissions (metric tons CO2e)516000
CommentIn 2018 BHGE verified that the 2012 baseline year remains appropriate based on revenue, number of employees, real estateportfolio, and number of vehicles.
Scope 2 (location-based)
Base year startJanuary 1 2012
Base year endDecember 31 2012
Base year emissions (metric tons CO2e)445000
CommentIn 2018 BHGE verified that the 2012 baseline year remains appropriate based on revenue, number of employees, real estateportfolio, and number of vehicles.
Scope 2 (market-based)
Base year startJanuary 1 2012
Base year endDecember 31 2012
Base year emissions (metric tons CO2e)445000
CommentMarket based and Location based emissions are identical for our 2012 baseline year. The 24 facilities in the UK covered under theinternal BHGE renewable energy initiative began in 2014.
C5.2
(C5.2) Select the name of the standard, protocol, or methodology you have used to collect activity data and calculate Scope1 and Scope 2 emissions.The Climate Registry: General Reporting Protocol
C6. Emissions data
C6.1
CDP Page of 5730
(C6.1) What were your organization’s gross global Scope 1 emissions in metric tons CO2e?
Reporting year
Gross global Scope 1 emissions (metric tons CO2e)353303
Start dateJanuary 1 2018
End dateDecember 31 2018
Comment
C6.2
(C6.2) Describe your organization’s approach to reporting Scope 2 emissions.
Row 1
Scope 2, location-basedWe are reporting a Scope 2, location-based figure
Scope 2, market-basedWe are reporting a Scope 2, market-based figure
CommentMarket based figure includes the purchase of renewably sourced electricity (wind power) for 24 facilities in the UK. We used a zeroemission factor since we received Renewable Energy Guarantees of Origin (REGO) for the electricity purchased in the UK forthese facilities.
C6.3
(C6.3) What were your organization’s gross global Scope 2 emissions in metric tons CO2e?
Reporting year
Scope 2, location-based282321
Scope 2, market-based (if applicable)274935
Start dateJanuary 1 2018
End dateDecember 31 2018
CommentOur 24 UK facilities in the renewable initiative consumed 17,762 MWh (@7,386 metric tonnes CO2e) in the reporting year. For ourlocation-based figure we used the grid average factor, while for our market-based figure we used a zero emission factor since wereceived Renewable Energy Guarantees of Origin (REGO) for the electricity purchased in the UK.
C6.4
(C6.4) Are there any sources (e.g. facilities, specific GHGs, activities, geographies, etc.) of Scope 1 and Scope 2 emissionsthat are within your selected reporting boundary which are not included in your disclosure?Yes
CDP Page of 5731
C6.4a
(C6.4a) Provide details of the sources of Scope 1 and Scope 2 emissions that are within your selected reporting boundarywhich are not included in your disclosure.
SourceRefrigerant Leakage
Relevance of Scope 1 emissions from this sourceEmissions are not relevant
Relevance of location-based Scope 2 emissions from this sourceEmissions are not relevant
Relevance of market-based Scope 2 emissions from this source (if applicable)Emissions are not relevant
Explain why this source is excludedLeakage of HFC refrigerants from BHGE owned and operated air conditioning, refrigeration and chilling systems are excludedbecause this leakage is regulated in the US and other countries and the emissions are considered to be insignificant. The use ofrefrigerant type gasses for testing purposes occurs in isolated instances and is subject to stringent controls. Refrigerants areexcluded based on existing boundary, which is consists of electricity, natural gas, and fuel use.
SourceRemedial Operations
Relevance of Scope 1 emissions from this sourceEmissions are not relevant
Relevance of location-based Scope 2 emissions from this sourceEmissions are not relevant
Relevance of market-based Scope 2 emissions from this source (if applicable)Emissions are not relevant
Explain why this source is excludedRemedial operations operationally controlled by BHGE are excluded because emissions are considered to be insignificant.
C6.5
(C6.5) Account for your organization’s Scope 3 emissions, disclosing and explaining any exclusions.
Purchased goods and services
Evaluation statusRelevant, calculated
Metric tonnes CO2e8996
Emissions calculation methodologyHotel stays based on the sum of nights stayed (337,671) globally provided by 3rd party travel company and multiplied by emissionfactor of 26.6 kg CO2e per day resulting in 8,982metric tonnes. Emissions were based on GHG Protocol for Scope 3 calculations,Category 1 for purchased goods and services.
Percentage of emissions calculated using data obtained from suppliers or value chain partners100
Explanation
CDP Page of 5732
Capital goods
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationThis year we received no relevant data from our suppliers pertaining to their work with BHGE. In most instances we were informedthat these companies calculate their emissions as a whole and to refer to their CDP submittal. In the past, we requested our topsuppliers of metals and chemicals to provide us with their Scope 1 and Scope 2 emissions that pertain to their work with ourcompany. Total metric tonnes provided were based on a very small percentage of suppliers who responded to our request for dataand we have recognized that there are significant challenges in obtaining this data. The request for emissions from our topsuppliers will be re-evaluated and we will strive to develop a plan to improve our view of the emissions in this category.
Fuel-and-energy-related activities (not included in Scope 1 or 2)
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE divested its North America pressure pumping operations at the end of 2016. We are no longer tracking the usage of off-road(dyed) diesel used during these operations.
Upstream transportation and distribution
Evaluation statusRelevant, calculated
Metric tonnes CO2e161488
Emissions calculation methodologyEstimated emissions from air/ocean shipments via global logistics and distribution
Percentage of emissions calculated using data obtained from suppliers or value chain partners100
ExplanationGlobal logistics and distribution shipped more than 204,968 metric tonnes of materials via air and ocean shipments. We have aninternal process to compile and process this information to calculate the emissions based upon carbon.org shipping calculator.
CDP Page of 5733
Waste generated in operations
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE no longer analyzes nor calculates emissions from waste generated in operations because these emissions are not material.We have evaluated these in the past using the EPA’s Warm v(14) tool to estimate waste materials generated that would have beensent a landfill and not recycled. These materials are mostly plant trash, construction debris, mixed plastic, and other non-hazardousmaterial that was neither recycled nor disposed of by a waste management specialist. This number is not material (<1,000 metrictons CO2e) to our overall emission footprint.
Business travel
Evaluation statusRelevant, calculated
Metric tonnes CO2e62213
Emissions calculation methodologyThe data used for the calculation was miles flown for business travel. CO2 and GHG (Green House Gases) calculation is based onDEFRA 2012 conversion factors.
Percentage of emissions calculated using data obtained from suppliers or value chain partners100
ExplanationThe data represents BHGE air travel emissions.
Employee commuting
Evaluation statusRelevant, calculated
Metric tonnes CO2e164231
Emissions calculation methodologyCommuting miles calculated using 25.2 round trip commuting miles. This is taken from U.S. DOT, Federal Highway Administration,2010 Status of the Nation's Highways, Bridges, and Transit: Conditions & Performance found athttps://www.fhwa.dot.gov/policy/2010cpr/execsum.cfm
Percentage of emissions calculated using data obtained from suppliers or value chain partners0
ExplanationThe calculations were based on BHGE employee head count of 66,000. Emissions assumed each employee commutes 25.2 milesper day, using an average fuel economy of 21.6 from Federal Highway Administration, Highway Statistics 2012, table VM-1.Average miles traveled per gallon of fuel consumed, passenger cars and other 2-axle 4-tire vehicles.http://www.fhwa.dot.gov/policyinformation/statistics/2012/vm1.cfm. See also U.S. Environmental Protection Agency, 2000, AverageAnnual Emissions and Fuel Consumption for Gasoline-Fueled Passenger Cars and Light Trucks,http://www.epa.gov/otaq/consumer/420f08024.pdf.
CDP Page of 5734
Upstream leased assets
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE does not own any upstream assets.
Downstream transportation and distribution
Evaluation statusRelevant, calculated
Metric tonnes CO2e4710
Emissions calculation methodologyBHGE does a partial calculation of third party shipping companies in the U.S. only. BHGE uses third party transportation by railroadto deliver various goods to our customers within the US. Emissions data was collected from the third party vendor but has not beenverified for accuracy. Emission Factors from The Climate Registry General Reporting Protocol were used which includes CarbonDioxide (CO2) or Carbon Dioxide Equivalent (CO2e), Methane (CH4), and Nitrous Oxide (N2O).
Percentage of emissions calculated using data obtained from suppliers or value chain partners100
ExplanationThis was the sixth year this category was evaluated and emissions data collected. In 2018 our rail usage was 2.8 million miles withour largest vendor in North America. We continue to utilize bulk shipping methods to improve our efficiencies and lower our costsand emissions.
Processing of sold products
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationMaterials from third parties represent less than 5% of sold products.
CDP Page of 5735
Use of sold products
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE is in the process of evaluating appropriate lifecycle analysis to determine emissions from our products and services. At thistime, the carbon footprint of the majority of our product portfolio is not considered to be relevant. We do believe that key productand service offerings can contribute to lower emissions for our customers. Therefore, we plan to evaluate these key products andservices to quantify emissions and determine level of relevance in the future. This work has begun for 2019.
End of life treatment of sold products
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationThe end of life treatment of our sold products such as downhole tools has a minimal carbon footprint.
Downstream leased assets
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE does not operate any downstream leased assets.
Franchises
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE does not operate any franchises as defined in the GHG Scope 3 Accounting and Reporting Standard.
CDP Page of 5736
Investments
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationBHGE does not currently invest in the external supply chain.
Other (upstream)
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationNo other upstream categories have been identified as being relevant.
Other (downstream)
Evaluation statusNot relevant, explanation provided
Metric tonnes CO2e<Not Applicable>
Emissions calculation methodology<Not Applicable>
Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>
ExplanationNo other downstream categories have been identified as being relevant.
C6.7
(C6.7) Are carbon dioxide emissions from biologically sequestered carbon relevant to your organization?Yes
C6.7a
CDP Page of 5737
(C6.7a) Provide the emissions from biologically sequestered carbon relevant to your organization in metric tons CO2.
Row 1
Emissions from biologically sequestered carbon (metric tons CO2)3250
CommentBiologically sequestered carbon is estimated based on total combustion of biodiesel for generation of electricity. Combines OECDand non-OECD estimated generations. The use of ethanol in gasoline for combustion in light duty vehicles is also included.
C6.10
(C6.10) Describe your gross global combined Scope 1 and 2 emissions for the reporting year in metric tons CO2e per unitcurrency total revenue and provide any additional intensity metrics that are appropriate to your business operations.
Intensity figure0.0000275
Metric numerator (Gross global combined Scope 1 and 2 emissions)628238
Metric denominatorunit total revenue
Metric denominator: Unit total22877000000
Scope 2 figure usedMarket-based
% change from previous year14
Direction of changeDecreased
Reason for changeBHGE strategic efforts to achieve energy efficiency, cost savings, and emissions reductions.
Intensity figure9.5
Metric numerator (Gross global combined Scope 1 and 2 emissions)628238
Metric denominatorfull time equivalent (FTE) employee
Metric denominator: Unit total66000
Scope 2 figure usedMarket-based
% change from previous year14
Direction of changeDecreased
Reason for changeBHGE strategic efforts to achieve energy efficiency, cost savings, and emissions reductions.
CDP Page of 5738
C7. Emissions breakdowns
C7.1
(C7.1) Does your organization break down its Scope 1 emissions by greenhouse gas type?Yes
C7.1a
(C7.1a) Break down your total gross global Scope 1 emissions by greenhouse gas type and provide the source of each usedgreenhouse warming potential (GWP).
Greenhouse gas Scope 1 emissions (metric tons of CO2e) GWP Reference
CO2 353294 Other, please specify (EPA eGRID 2014)
CH4 8.36 Other, please specify (EPA eGRID 2014)
N2O 0.69 Other, please specify (EPA eGRID 2014)
C7.2
(C7.2) Break down your total gross global Scope 1 emissions by country/region.
Country/Region Scope 1 emissions (metric tons CO2e)
North America 221634
South America 60599
Europe 56991
Other, please specify (Rest of the World) 14080
C7.3
(C7.3) Indicate which gross global Scope 1 emissions breakdowns you are able to provide.By business division
C7.3a
(C7.3a) Break down your total gross global Scope 1 emissions by business division.
Business division Scope 1 emissions (metric ton CO2e)
Oilfield Services 179478
Turbomachinery Process Solutions 92919
Oilfield Equipment 40630
Digital Measurement and Controls 40277
C7.5
CDP Page of 5739
(C7.5) Break down your total gross global Scope 2 emissions by country/region.
Country/Region Scope 2, location-based (metric tonsCO2e)
Scope 2, market-based (metric tonsCO2e)
Purchased and consumedelectricity, heat, steam orcooling (MWh)
Purchased and consumed low-carbon electricity, heat,steam or cooling accounted in market-based approach(MWh)
North America 212657 212657 414993 0
Middle East 23734 23734 32791 0
Europe 30327 22941 81675 17762
Other, pleasespecify (Rest ofthe World)
15602 15602 26324 0
Please select
C7.6
(C7.6) Indicate which gross global Scope 2 emissions breakdowns you are able to provide.By business division
C7.6a
(C7.6a) Break down your total gross global Scope 2 emissions by business division.
Business division Scope 2, location-based emissions (metric tons CO2e) Scope 2, market-based emissions (metric tons CO2e)
Oilfield Services 139667
Turbomachinery Process Solutions 31618 31618
Oilfield Equipment 72308 72308
Digital Measurement and Controls 31343 31343
C7.9
(C7.9) How do your gross global emissions (Scope 1 and 2 combined) for the reporting year compare to those of theprevious reporting year?Decreased
C7.9a
CDP Page of 5740
(C7.9a) Identify the reasons for any change in your gross global emissions (Scope 1 and 2 combined) and for each of themspecify how your emissions compare to the previous year.
Change inemissions(metrictonsCO2e)
Directionof change
Emissionsvalue(percentage)
Please explain calculation
Change inrenewableenergyconsumption
2009 Decreased 0.3 The emissions saved from using renewables increased in 2018. 24 facilities in the UK use 100% wind energyand increased usage resulted in 586 metric tonnes CO2e saved compared to the previous year. In addition 3onsite solar arrays were utilized resulting in an increase of renewable consumption with an additional 1,322metric tonnes CO2e saved. This resulted in a net increase of renewable consumption for 2018 of 2,009metric tonnes CO2e. This is 0.3% of 2017 combined Scope 1 and 2 emissions of 706,954 metric tonnesCO2e.
Otheremissionsreductionactivities
18013 Decreased 2.5 We achieved our emission reductions through a combination of strategies, including 33 LED Lighting retrofitsand 73 facility consolidation projects. These consolidations have improved the overall energy efficiencyacross our real estate portfolio, decreasing the energy intensity of activities at our company locations andimproving the efficiency of our logistics network. In 2018 we eliminated an estimated 18,013 metric tonsCO2e through these efforts. (18,013/706,954)*100 = 2.5%
Divestment 0 No change 0 Did not have any divestments that affected emissions in 2018
Acquisitions 0 No change 0 Did not have any acquisitions that affected emissions in 2018
Mergers 0 No change 0 Did not have any mergers that affected emissions in 2018
Change inoutput
0 Decreased 0 No change in output.
Change inmethodology
0 No change 0 No change in methodology.
Change inboundary
0 No change 0 No change in boundary.
Change inphysicaloperatingconditions
0 No change 0 Did not have any changes in physical operating conditions in 2018.
Unidentified 0 No change 0 No “unidentified” activity in 2018.
Other 58795 Decreased 8.3 Our emission reductions include a combination of strategies including several mentioned above, which aremanaged at a company-wide level plus a wide array of local activities. We have general information andinsight into the types of energy efficiency and energy conservation efforts which are led by local teams. Webelieve the net decrease in emissions is driven by these combined efforts across our global operations. Theoverall change is (58,795/706,954)*100 = 8.3%
C7.9b
(C7.9b) Are your emissions performance calculations in C7.9 and C7.9a based on a location-based Scope 2 emissions figureor a market-based Scope 2 emissions figure?Market-based
C8. Energy
C8.1
(C8.1) What percentage of your total operational spend in the reporting year was on energy?More than 10% but less than or equal to 15%
C8.2
CDP Page of 5741
(C8.2) Select which energy-related activities your organization has undertaken.
Indicate whether your organization undertakes this energy-related activity
Consumption of fuel (excluding feedstocks) Yes
Consumption of purchased or acquired electricity Yes
Consumption of purchased or acquired heat No
Consumption of purchased or acquired steam No
Consumption of purchased or acquired cooling No
Generation of electricity, heat, steam, or cooling Yes
C8.2a
(C8.2a) Report your organization’s energy consumption totals (excluding feedstocks) in MWh.
Heating value MWh from renewablesources
MWh from non-renewablesources
Total MWh
Consumption of fuel (excluding feedstock) LHV (lower heatingvalue)
1048218 1048218
Consumption of purchased or acquired electricity <Not Applicable> 17762 555783 573545
Consumption of purchased or acquired heat <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>
Consumption of purchased or acquired steam <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>
Consumption of purchased or acquired cooling <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>
Consumption of self-generated non-fuel renewableenergy
<Not Applicable> <Not Applicable>
Total energy consumption <Not Applicable> 17762 1604001 1621763
C8.2b
(C8.2b) Select the applications of your organization’s consumption of fuel.
Indicate whether your organization undertakes this fuel application
Consumption of fuel for the generation of electricity Yes
Consumption of fuel for the generation of heat Yes
Consumption of fuel for the generation of steam No
Consumption of fuel for the generation of cooling Please select
Consumption of fuel for co-generation or tri-generation No
C8.2c
(C8.2c) State how much fuel in MWh your organization has consumed (excluding feedstocks) by fuel type.
Fuels (excluding feedstocks)Natural Gas
Heating valueLHV (lower heating value)
Total fuel MWh consumed by the organization819175
CDP Page of 5742
MWh fuel consumed for self-generation of electricity0
MWh fuel consumed for self-generation of heat0
MWh fuel consumed for self-generation of steam<Not Applicable>
MWh fuel consumed for self-generation of cooling<Not Applicable>
MWh fuel consumed for self-cogeneration or self-trigeneration<Not Applicable>
Comment
Fuels (excluding feedstocks)Other, please specify (Distillate Fuels (& Off-Road Diesel))
Heating valueLHV (lower heating value)
Total fuel MWh consumed by the organization227974
MWh fuel consumed for self-generation of electricity0
MWh fuel consumed for self-generation of heat0
MWh fuel consumed for self-generation of steam<Not Applicable>
MWh fuel consumed for self-generation of cooling<Not Applicable>
MWh fuel consumed for self-cogeneration or self-trigeneration<Not Applicable>
CommentReported value does not include transportation fuels consumed by global fleet vehicles.
Fuels (excluding feedstocks)Liquefied Petroleum Gas (LPG)
Heating valueLHV (lower heating value)
Total fuel MWh consumed by the organization681
MWh fuel consumed for self-generation of electricity0
MWh fuel consumed for self-generation of heat0
MWh fuel consumed for self-generation of steam<Not Applicable>
MWh fuel consumed for self-generation of cooling<Not Applicable>
MWh fuel consumed for self-cogeneration or self-trigeneration<Not Applicable>
Comment
CDP Page of 5743
Fuels (excluding feedstocks)Propane Gas
Heating valueLHV (lower heating value)
Total fuel MWh consumed by the organization389
MWh fuel consumed for self-generation of electricity0
MWh fuel consumed for self-generation of heat0
MWh fuel consumed for self-generation of steam<Not Applicable>
MWh fuel consumed for self-generation of cooling<Not Applicable>
MWh fuel consumed for self-cogeneration or self-trigeneration<Not Applicable>
Comment
C8.2d
CDP Page of 5744
(C8.2d) List the average emission factors of the fuels reported in C8.2c.
Liquefied Petroleum Gas (LPG)
Emission factor61.71
Unitkg CO2 per million Btu
Emission factor sourceThe Climate Registry 2018 Default Emission Factors Table 12.1 U.S. Default Factors for Calculating CO2 Emissions fromCombustion of Fossil Fuel and Biomass
Comment
Natural Gas
Emission factor57.3
Unitkg CO2 per million Btu
Emission factor sourceThe Climate Registry 2018 Default Emission Factors Table 12.1 U.S. Default Factors for Calculating CO2 Emissions fromCombustion of Fossil Fuel and Biomass
Comment
Propane Gas
Emission factor62.87
Unitkg CO2 per million Btu
Emission factor sourceThe Climate Registry 2018 Default Emission Factors Table 12.1 U.S. Default Factors for Calculating CO2 Emissions fromCombustion of Fossil Fuel and Biomass
Comment
Other
Emission factor73.96
Unitlb CO2 per million Btu
Emission factor sourceThe Climate Registry 2018 Default Emission Factors Table 12.1 U.S. Default Factors for Calculating CO2 Emissions fromCombustion of Fossil Fuel and Biomass
Comment
C8.2e
CDP Page of 5745
(C8.2e) Provide details on the electricity, heat, steam, and cooling your organization has generated and consumed in thereporting year.
Total Grossgeneration (MWh)
Generation that is consumed by theorganization (MWh)
Gross generation fromrenewable sources (MWh)
Generation from renewable sources that isconsumed by the organization (MWh)
Electricity 1985 1985 1985 1985
Heat 0 0 0 0
Steam 0 0 0 0
Cooling 0 0 0 0
C8.2f
(C8.2f) Provide details on the electricity, heat, steam and/or cooling amounts that were accounted for at a low-carbonemission factor in the market-based Scope 2 figure reported in C6.3.
Basis for applying a low-carbon emission factorEnergy attribute certificates, Guarantees of Origin
Low-carbon technology typeWind
Region of consumption of low-carbon electricity, heat, steam or coolingOther, please specify (United Kingdom, 24 Facilities)
MWh consumed associated with low-carbon electricity, heat, steam or cooling17762
Emission factor (in units of metric tons CO2e per MWh)0
CommentFor electricity use in the United Kingdom, 24 operating facilities receive electricity generated from wind farms.
C9. Additional metrics
C9.1
(C9.1) Provide any additional climate-related metrics relevant to your business.
DescriptionPlease select
Metric value
Metric numerator
Metric denominator (intensity metric only)
% change from previous year
Direction of change<Not Applicable>
Please explain
CDP Page of 5746
C10. Verification
C10.1
(C10.1) Indicate the verification/assurance status that applies to your reported emissions.
Verification/assurance status
Scope 1 Third-party verification or assurance process in place
Scope 2 (location-based or market-based) Third-party verification or assurance process in place
Scope 3 Third-party verification or assurance process in place
C10.1a
(C10.1a) Provide further details of the verification/assurance undertaken for your Scope 1 and/or Scope 2 emissions andattach the relevant statements.
ScopeScope 1
Verification or assurance cycle in placeAnnual process
Status in the current reporting yearComplete
Type of verification or assuranceLimited assurance
Attach the statementYBHGE GHG Verification Statement 2018 Emissions 30-July-2019.pdf
Page/ section referenceSee attached document pages 1 and 2.
Relevant standardISO14064-3
Proportion of reported emissions verified (%)95
ScopeScope 2 location-based
Verification or assurance cycle in placeAnnual process
Status in the current reporting yearComplete
Type of verification or assuranceThird party verification/assurance underway
Attach the statementYBHGE GHG Verification Statement 2018 Emissions 30-July-2019.pdf
Page/ section referenceSee attached document pages 1 and 2.
CDP Page of 5747
Relevant standardISO14064-3
Proportion of reported emissions verified (%)95
ScopeScope 2 market-based
Verification or assurance cycle in placeAnnual process
Status in the current reporting yearComplete
Type of verification or assuranceThird party verification/assurance underway
Attach the statementYBHGE GHG Verification Statement 2018 Emissions 30-July-2019.pdf
Page/ section referenceSee attached document pages 1 and 2.
Relevant standardISO14064-3
Proportion of reported emissions verified (%)95
C10.1b
(C10.1b) Provide further details of the verification/assurance undertaken for your Scope 3 emissions and attach the relevantstatements.
ScopeScope 3- at least one applicable category
Verification or assurance cycle in placeAnnual process
Status in the current reporting yearComplete
Attach the statementYBHGE GHG Verification Statement 2018 Emissions 30-July-2019.pdf
Page/section referenceSee attached document pages 1 and 2.
Relevant standardISO14064-3
C10.2
(C10.2) Do you verify any climate-related information reported in your CDP disclosure other than the emissions figuresreported in C6.1, C6.3, and C6.5?No, we do not verify any other climate-related information reported in our CDP disclosure
CDP Page of 5748
C11. Carbon pricing
C11.1
(C11.1) Are any of your operations or activities regulated by a carbon pricing system (i.e. ETS, Cap & Trade or Carbon Tax)?Yes
C11.1a
(C11.1a) Select the carbon pricing regulation(s) which impacts your operations.EU ETSOther carbon tax, please specify (CRC - Carbon Reduction Commitment)
C11.1b
(C11.1b) Complete the following table for each of the emissions trading systems in which you participate.
EU ETS
% of Scope 1 emissions covered by the ETS9
Period start dateJanuary 1 2018
Period end dateDecember 31 2018
Allowances allocated9585
Allowances purchased16000
Verified emissions in metric tons CO2e31521
Details of ownershipFacilities we own and operate
CommentThe central enterprise team receives the information from the various locations covered under this system. The data is notaggregated at the enterprise level since BHGE has multiple legal entities across the European Union.
C11.1c
CDP Page of 5749
(C11.1c) Complete the following table for each of the tax systems in which you participate.
Other carbon tax, please specify
Period start dateMarch 31 2018
Period end dateApril 1 2019
% of emissions covered by tax80
Total cost of tax paid400000
CommentThe 80% of emissions covered by tax is the percentage of the total emission in the UK.
C11.1d
(C11.1d) What is your strategy for complying with the systems in which you participate or anticipate participating?
BHGE operates in approximately 120 countries globally and is subject to a wide variety of laws, regulations and government policiesthat may change in significant ways. We work with the highest integrity and commitment to compliance everywhere we work. BHGEhas identified certain operations and activities that are regulated by carbon pricing regimes, and we will work to comply with anyapplicable systems now and in the future.
For example, in 2011, we registered our facilities in the UK and evaluated the requirements of the UK Carbon Reduction Commitment(CRC) scheme in great detail. Processes were developed for monitoring and reporting energy use at relevant facilities in compliancewith regulatory requirements. 2018 was our eighth year to participate in CRC. Energy reduction efforts in the UK are ongoing withsignificant improvements achieved to date. Proactive efforts have included the continuation of energy awareness campaigns andimplementation of energy improvement projects, as well as purchased electricity in the UK being 100% from a renewable source(wind). Executive management is supportive of energy improvement projects where business value is identified.
For the EU ETS, each year the company surrenders enough allowances to cover its emissions to avoid heavy fines which can beimposed. Any spare allowances are either kept to cover any future needs or sold to another company that is short of allowances.
C11.2
(C11.2) Has your organization originated or purchased any project-based carbon credits within the reporting period?No
C11.3
(C11.3) Does your organization use an internal price on carbon?No, but we anticipate doing so in the next two years
C12. Engagement
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C12.1
(C12.1) Do you engage with your value chain on climate-related issues?Yes, our suppliersYes, our customersYes, other partners in the value chain
C12.1a
(C12.1a) Provide details of your climate-related supplier engagement strategy.
Type of engagementInformation collection (understanding supplier behavior)
Details of engagementCollect climate change and carbon information at least annually from suppliers
% of suppliers by number1
% total procurement spend (direct and indirect)12
% Scope 3 emissions as reported in C6.5100
Rationale for the coverage of your engagementEngagement Process: Baker Hughes engages governments, customers, suppliers, employees, communities, andnongovernmental organizations on issues material to our investments around the world. Specifically, we engage trade and businessassociations, customers, suppliers, employees, communities, and nongovernmental organizations on issues of mutual concern. OurSuppliers: Baker Hughes evaluates the policies and practices of suppliers with regard to environmental performance. For 2018, werequested specific emissions data from our top suppliers of rail transportation services, and global travel providers (air, car rentaland hotel data). Emissions data received from our suppliers was allocated based on shipments and revenue earned from BakerHughes.
Impact of engagement, including measures of successBaker Hughes evaluates the policies and practices of suppliers with regard to environmental performance in addition to collecteddata from several of our top suppliers as indicated in our rationale for engagement. Measurement is based on the number ofrequests received on allocated emissions, which in 2018 was 100% of key Scope 3 suppliers requested.
Comment
C12.1b
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(C12.1b) Give details of your climate-related engagement strategy with your customers.
Type of engagementCollaboration & innovation
Details of engagementOther – please provide information in column 5
% of customers by number50
% Scope 3 emissions as reported in C6.50
Please explain the rationale for selecting this group of customers and scope of engagementWe engage at least 50% of our key accounts on the topic of carbon emissions reduction including a discussion of collaborationopportunities. Rationale: We have focused collaboration and innovation efforts on our largest customers, which are the so-calledinternational oil companies (IOCs), national oil companies (NOCs), and large independents. Many of these customers have aclimate strategy and have set carbon reduction targets spanning their Scope 1 and 2 emissions and in some cases their Scope 3emissions. They have therefore shown interest in how we, as their supplier, can help them reach these targets. Scope ofEngagement: We have begun joint collaboration and innovation initiatives with several large customers in which we have identifiedand quantified emissions reductions opportunities across our joint value chains and have chosen specific geographies and assetson which to pilot solutions. Once implemented, we will track emissions reductions. In addition, we regularly discuss opportunitieswith our large customers to jointly engage in research and development of technologies that will reduce joint emissions. AdditionalComments: In addition, we have provided emissions data to customers via the CDP supply chain program, when requested.
Impact of engagement, including measures of successImproved understanding of current state emissions across our joint value chains as well as opportunities, and challenges to reducethese.
Type of engagementEducation/information sharing
Details of engagementRun an engagement campaign to educate customers about the climate change impacts of (using) your products, goods, and/orservices
% of customers by number50
% Scope 3 emissions as reported in C6.50
Please explain the rationale for selecting this group of customers and scope of engagementRationale: We have focused education and information sharing efforts on our largest customers, which are the so-calledinternational oil companies (IOCs), national oil companies (NOCs), and large independents. Many of these customers have aclimate strategy and have set carbon reduction targets spanning their Scope 1 and 2 emissions and in some cases their Scope 3emissions. They have therefore shown interest in how we, as their supplier, can help them reach these targets. Scope ofEngagement: We have shared general data on global emissions, emissions across the oil and gas value chain and specificactivities therein, and emissions from different types of production. In addition, we have shared BHGE’s climate strategy and Scope1 and Scope 2 carbon reduction targets. Finally, we have shared our strategy to help reduce our customers’ carbon footprints. Thisincludes sharing data on both the emissions reductions and associated financial benefits of BHGE products and services that canhelp our customers reduce their Scope 1 and 2 emissions. In future, we will also share data on their Scope 3 emissions as it relatesto our portion of their supply chain. We also engage with customers through various forums such as IOGP, IPIECA, AmericanPetroleum Institute, Environmental Partnership and Methane Guiding Principles.
Impact of engagement, including measures of successAgreed short-term, medium-term, and longer-term actions to reduce footprint, including using BHGE products and services toreduce use-phase emissions
C12.1c
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(C12.1c) Give details of your climate-related engagement strategy with other partners in the value chain.
BHGE has partnered with Soltage, a renewable energy provided, in recent years to develop a solar farm as part of its commitment tocreate sustainable energy development and its goal of reducing greenhouse gases. The solar farm uses approximately 25 of the 134acres owned by Baker Hughes, a GE company. Soltage's installation consists of a 4.75-megawatt (MW) system “Bird Machine SolarFarm” on a brownfield located on the former Bird Machine Company industrial site at 100 Neponset St. in Walpole, MA. “Turningbrownfields into brightfields is an ideal solution for many municipalities like Walpole across Massachusetts and across the country,”said Soltage CEO Jesse Grossman. “Walpole has shown real environmental and economic leadership by enabling this project whichwill help spur local economic development and create strong environmental benefits. By installing solar on brownfields we’re loweringcosts for local communities, creating jobs and contributing to the local economy.” The solar farm is made up of 14,600 panels thatcan produce 6 million kWh of energy per year, enough to power 623 homes per year and offset almost 9.3 million pounds of CO2,according to Grossman. “In addition to increased revenue obtained from siting the solar farm on otherwise unused land within itsborders, the town of Walpole benefits from significant reductions in its annual electricity expenditure. Through increased revenue anddecreased costs, more money is available for programs that directly benefit local residents,” Gregory said. An article detailing theproject can be found at the following link: https://www.solarpowerworldonline.com/2017/09/soltage-completes-4-75-mw-solar-farm-brownfield-massachusetts/
C12.3
(C12.3) Do you engage in activities that could either directly or indirectly influence public policy on climate-related issuesthrough any of the following?Direct engagement with policy makersTrade associations
C12.3a
(C12.3a) On what issues have you been engaging directly with policy makers?
Focus oflegislation
Corporateposition
Details of engagement Proposed legislative solution
Other,pleasespecify(Tradeassociations)
Support BHGE participates in industryassociations that engage with policymakers on legislation intended toreduce greenhouse gasemissions.This includes participationin technical roundtables, submittal oftechnical publications; peer review ofpublications and disclosures tocustomers, investors and the generalpublic through our website(www.bhge.com).
Through industry associations, we advocate for effective controls that do not add undue burden tothe business.
Regulationof methaneemissions
Support Baker Hughes is working with IOGPin a joint working relationship withIPIECA to discuss the concerns overmethane emissions and engageregulators on potential regulatorydevelopments. See link to IPIECAMethane Factsheet: –www.ipieca.org/publication/exploring-methane-emissions
On May 12, 2016 EPA issued a draft Information Collection Request (ICR) to require oil andnatural gas companies to provide extensive information needed to develop regulations to reducemethane emissions from existing oil and gas sources. In addition, the agency announced plans toissue a Request for Information to seek information on innovative strategies that can accuratelyand cost-effectively locate, measure and mitigate methane emissions. Mitigating emissions ofmethane will provide additional opportunities for society. The industry has been working for manyyears to reduce methane emissions through mandatory and voluntary programmes, including theNatural Gas STAR Program and the Global Methane Initiative. Individual companies inconjunction with industry will continue to explore and take opportunities to reduce methaneemissions, along with other greenhouse gases, to play its role in managing the risks of climatechange.
Mandatorycarbonreporting
Neutral Representatives of BHGE participatein public meetings and conferencesat which regulators interact withindustry and also through directcomment on rule-making. Thisincludes rule-making on mandatorycarbon reporting.
By providing comment on proposed rule-making and engaging directly with our regulatorystakeholders, we seek to provide accurate information on our industry's commitments, efforts, andprogress related to carbon footprint reporting. We advocate for effective controls that do not addundue burden to the business.
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C12.3b
(C12.3b) Are you on the board of any trade associations or do you provide funding beyond membership?Yes
C12.3c
(C12.3c) Enter the details of those trade associations that are likely to take a position on climate change legislation.
Trade associationInternational Association of Oil & Gas Producers (IOGP) IOGP’s Management Committee is responsible for the Association’s overallstrategy and direction. It provides guidance on policy, work plans, finance and communications and it ensures that the organizationkeep to their Articles of Association.
Is your position on climate change consistent with theirs?Consistent
Please explain the trade association’s positionIOGP is dedicated to identifying and spreading good environmental practice wherever the upstream industry operates. Their workincludes: • Ensuring continued access to new and known hydrocarbon sources • Environmental management and reporting •Gaseous emissions management • Monitoring regulatory developments and developing advocacy positions IOGP recognizes therisks of climate change due to rising greenhouse gas emissions and has welcomed the Paris Agreement. The Association supportsthe international community’s commitment to address the global challenge of climate change and also believes that the oil and gasindustry is very much a part of the solution to this challenge, which can be addressed while meeting society’s future energy needs.The long-term objective of climate change policy should be to reduce the risk of serious impacts on society and ecosystems, whilerecognizing the importance of reliable and affordable energy to society. IOGP is a leading force behind GasNaturally, a partnershipof six organizations that extend the length of the natural gas value chain. GasNaturally represents more than 130 companies.GasNaturally aims to showcase the potential that natural gas can play in building a cost-effective and sustainable energy mix. Itseeks to help policy makers formulate a clear vision on how to face the challenges ahead, relying on natural gas as a safe, secureand reliable energy source. Natural gas can: • Help achieve the transition to a low-carbon energy system cost-effectively • Providethe cheapest and fastest way to achieve significant CO2 emission reductions • Complement renewables by providing essentialback-up capacity to balance out the variability of some renewable sources For these reasons, gas will be a key player in the longterm. Without it, the shift to a low-carbon energy system could seriously compromise quality of life by limiting access to affordableheat, light and mobility for households and businesses alike.
How have you influenced, or are you attempting to influence their position?In 2018 our BHGE Chief Health, Safety and Environment (HSE) Officer was an active member on the Management Committee andBHGE’s Global Environmental and Sustainability Director co-chairs the Environmental Committee. BHGE regularly participates andreviews key position statements with internal leadership. Our Global Environment and Sustainability Director is a co-chair of theIOGP Environment Committee, whose remit includes climate change as a key area.
Trade associationIPIECA is the global oil and gas industry association for environmental and social issues IPIECA is governed by a GeneralCommittee comprised of senior representatives from IPIECA member companies and associations. BHGE’s Global Environmental& Sustainability Director is the company representative for IPIECA’s General Committee and is also a member of the EnvironmentalGroup that provides direction to the various working groups. The BHGE Global Environment and Sustainability Director participatesin the Climate Change Working Group, and several other company representatives participate in the Social Responsibility,Reporting and Communications work groups, among others.
Is your position on climate change consistent with theirs?Consistent
Please explain the trade association’s positionIPIECA acts as a catalyst to bring experts together to work on issues such as greenhouse gas (GHG) emissions, energy efficiencyand reducing the impact of fuel emissions. By doing this, we help the oil and gas industry manage its environmental impact andaddress climate risks while it works to meet the increasing demand for energy. IPIECA is helping the industry be part of the climatechange solution by developing industry guidelines on GHG reporting, a series of good practices on energy efficiency andgreenhouse gas management, and an ongoing record of convening expert workshops to explore key climate-related issues,informing the industry and stakeholders. Conserving the energy and greenhouse gases (GHGs) used to produce oil and gas canmake a major contribution to moving the world onto a more sustainable energy path. Often, the most economical method ofreducing GHG emissions is to reduce energy consumed. This is because the easiest emissions to control are the ones neverproduced. For this reason, IPIECA works with the industry to help reduce emissions with sharing of good practices, tools and
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through providing opportunities for sharing knowledge. IPIECA develops industry best practice and the promotion of technologicaland management solutions to reduce GHGs (for oil and gas this is mainly CO2 and methane) across the production, refining andtransportation of oil and gas. For emissions from our operations, management largely means energy conservation or efficiencymeasures, reducing gas flaring and managing the emissions of methane.
How have you influenced, or are you attempting to influence their position?BHGE’s Global Environmental & Sustainability Director is the company representative for IPIECA’s General CommitteeEnvironmental Group and is also an active member of the Climate Change Working Group. BHGE also has several companyrepresentatives that are part of the following additional working groups / task forces: Social Responsibility, Reporting andCommunications. BHGE regularly participates and reviews key position statements with internal leadership.
C12.3f
(C12.3f) What processes do you have in place to ensure that all of your direct and indirect activities that influence policy areconsistent with your overall climate change strategy?
BHGE climate change strategy is set and approved at the executive level and is part of our overall performance goals and objectives.Each year, the Executive Leadership Team agrees on a plan to improve our environmental performance by setting key performanceindicator goals as well as actionable tasks.
BHGE supports policies that promote both lower carbon emissions and sustainable economic growth. Policies and regulations tohelp reduce carbon emissions are essential to drive technology development and deployment. Fairness to consumers,environmental integrity, cost-effectiveness, sound science and technology neutrality should be the guiding principles for arriving atany national strategy.
BHGE has published information related to climate change and reduced GHG emissions (see 2018 Corporate Responsibility Report(https://my.bhge.com/smarter-together/taking-energy-forward-responsibly) and the BHGE Corporate Responsibility webpage athttps://www.bhge.com/planet) internally and externally to the organization. The report and website describes our commitment tomanaging climate change risks and the ways in which we do that. This document is used to inform members of the organization thatinteract with policy-makers on BHGE's position on climate change.
BHGE offers customers a fullstream portfolio of integrated gas technologies, solutions and services that improve productivity andreduces carbon footprint. Visit our website for additional detail: https://www.bhge.com/fullstream
In addition, we have established an enterprise goal for the reduction of energy consumption and associated GHG emissions. This issupported by a global procedure on energy conservation aligned with the requirements of the energy management standard, ISO50001, which is contained within the Health, Safety and Environment Management System.
C12.4
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(C12.4) Have you published information about your organization’s response to climate change and GHG emissionsperformance for this reporting year in places other than in your CDP response? If so, please attach the publication(s).
PublicationOther, please specify (Our 2018 Corporate Responsibility Report and prior reports available on our website. We also have generalinformation on our Planet webpage, Climate section. Climate change risks and opportunities are discussed in the BHGE annualreport and 10K. )
StatusComplete
Attach the document2018 BHGE Annual Report.pdfBHGE 2018 Corporate Responsibility Report.pdf
Page/Section referenceRefer to the Planet Section on page 13 of the 2018 BHGE Corporate Responsibility Report. Climate change risks and opportunitiesare discussed in the BHGE annual report including 10K, also attached. Also refer to pages 4 and 15 of the front glossy section ofthe 2018 Annual report and pages 14, 15 and 18 of the 10K.
Content elementsGovernanceStrategyRisks & opportunitiesEmissions figuresEmission targetsOther metrics
Comment
C14. Signoff
C-FI
(C-FI) Use this field to provide any additional information or context that you feel is relevant to your organization's response.Please note that this field is optional and is not scored.
C14.1
(C14.1) Provide details for the person that has signed off (approved) your CDP climate change response.
Job title Corresponding job category
Row 1 Chief Health, Safety, Environment, Quality, and Security Officer Other C-Suite Officer
Submit your response
In which language are you submitting your response?English
Please confirm how your response should be handled by CDP
Public or Non-Public Submission I am submitting to
I am submitting my response Public Investors
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Please state the main reason why you are declining to respond to your CustomersRequest not received directly from Customers
Please confirm belowI have read and accept the applicable Terms
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