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Gas Utilities & Distributors
The Gas Utilities & Distributors industry consists of gas distribution and marketing entities. Gas distribution involves operating local, low-pressure pipes to transfer natural gas from larger transmission pipes to end users. Gas marketing entities are gas brokers that aggregate and deliver natural gas in quantities that meet the needs of various customers, generally through other entities’ transmission and distribution lines. A relatively smaller portion of this industry is involved in propane gas distribution; therefore, this standard is focused on natural gas distribution. Both types of gas are used for heating and cooking by residential, commercial and industrial customers. In regulated markets, the utility is granted a full monopoly over the distribution and sale of natural gas. A regulator must approve the rates utilities charge to prevent the abuse of their monopoly position. In deregulated markets, distribution and marketing are separated legally, and customers have a choice of which entity from which to buy their gas. In this case, a common carrier utility is guaranteed a monopoly only over distribution and is required legally to transmit all gas equitably along its pipes for a fixed fee. Overall, entities must provide safe, reliable, low-cost gas, while effectively managing their social and environmental impacts, such as community safety and methane emissions.
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Fuel Cells & Industrial Batteries
Fuel Cells & Industrial Batteries industry entities manufacture fuel cells for energy production and energy storage equipment such as batteries. Manufacturers in this industry mainly sell products to entities for varied energy-generation and energy-storage applications and intensities, from commercial business applications to large-scale energy projects for utilities. Entities in the industry typically have global operations and sell products to a global marketplace.
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Relevant Issues for both Industries (7 of 26)

Why are some issues greyed out?

The SASB Standards vary by industry based on the different sustainability-related risks and opportunities within an industry. The issues in grey were not identified during the standard-setting process as the most likely to be useful to investors, so they are not included in the Standard. Over time, as the ISSB continues to receive market feedback, some issues may be added or removed from the Standard. Each company determines which sustainability-related risks and opportunities are relevant to its business. The Standard is designed for the typical company in an industry, but individual companies may choose to report on different sustainability-related risks and opportunities based on their unique business model.

Environment
- GHG Emissions
- Air Quality
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
- Water & Wastewater Management
- Waste & Hazardous Materials Management
- Ecological Impacts
Social Capital
- Human Rights & Community Relations
- Customer Privacy
- Data Security
- Access & Affordability
  The category addresses a company’s ability to ensure broad access to its products and services, specifically in the context of underserved markets and/or population groups. It includes the management of issues related to universal needs, such as the accessibility and affordability of health care, financial services, utilities, education, and telecommunications.
- Product Quality & Safety
- Customer Welfare
- Selling Practices & Product Labeling
Human Capital
- Labour Practices
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
- Employee Engagement, Diversity & Inclusion
Business Model and Innovation
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
- Supply Chain Management
- Materials Sourcing & Efficiency
  The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
- Physical Impacts of Climate Change
Leadership and Governance
- Business Ethics
- Competitive Behaviour
- Management of the Legal & Regulatory Environment
- Critical Incident Risk Management
  The category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
- Systemic Risk Management

Disclosure Topics

What is the relationship between General Issue Category and Disclosure Topics?

The General Issue Category is an industry-agnostic version of the Disclosure Topics that appear in each SASB Standard. Disclosure topics represent the industry-specific impacts of General Issue Categories. The industry-specific Disclosure Topics ensure each SASB Standard is tailored to the industry, while the General Issue Categories enable comparability across industries. For example, Health & Nutrition is a disclosure topic in the Non-Alcoholic Beverages industry, representing an industry-specific measure of the general issue of Customer Welfare. The issue of Customer Welfare, however, manifests as the Counterfeit Drugs disclosure topic in the Biotechnology & Pharmaceuticals industry.

Gas Utilities & Distributors Remove
Access Standard
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
  
  None
- Access & Affordability
  The category addresses a company’s ability to ensure broad access to its products and services, specifically in the context of underserved markets and/or population groups. It includes the management of issues related to universal needs, such as the accessibility and affordability of health care, financial services, utilities, education, and telecommunications.
  - Energy Affordability
    An objective of gas utilities is to deliver natural gas to customers in a safe, reliable and environmentally responsible manner. Entities in the industry manage these potentially competing priorities while maintaining favourable relations with customers and regulators—and ultimately to earn appropriate shareholder returns. From the utility customer perspective, the affordability of energy is challenging to balance, because it often conflicts with other core objectives. Utility energy bills generally are perceived to be increasingly more expensive for low-income customers (affordability is determined by both the net cost of energy bills and the underlying economics of customers). Ensuring utility bills remain affordable is crucial for utilities in building trust (intangible asset value) with regulators and customers. The quality of regulatory relations is an important value driver for utilities, and one of the issues analysed closely by investment analysts. Regulators’ willingness, or lack thereof, to grant rate requests, rate structure modifications, cost recovery and allowed returns is a primary determinant of financial performance and investment risk. Effectively managing affordability may provide opportunities to grow capital investment, revise rate structures favourably and increase allowed returns. Furthermore, utilities that ineffectively manage affordability increasingly face customers reducing their reliance upon natural gas (or reducing energy needs) and pursuing alternative energy sources (for example, industrial customers’ use of combined heat and power). Managing affordability involves operating an efficient business with a comprehensive, long-term strategy, as well as working closely with regulators and public policymakers on rate structures and, potentially, bill-assistance programmes. Although utility business models and rate structures largely determine the precise nature of the financial effects, affordability is a critical business issue for utilities managing, maintaining and growing their customer bases, building intangible asset value, creating investment and return opportunities, and ultimately delivering shareholder returns.
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
  
  None
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
  
  None
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
  - End-Use Efficiency
    Natural gas produces fewer greenhouse gas (GHG) emissions than other fossil fuels. Expanding its use in the economy may be an important strategy for many governments and regulators striving to reduce GHG emissions. However, despite the relatively lower emissions, the natural gas value chain still produces meaningful levels of GHG emissions overall. As policymakers and regulators seek to mitigate climate change, the efficient consumption of natural gas will be an important long-term theme. Energy efficiency is a low-lifecycle-cost method to reduce greenhouse gas (GHG) emissions. Utilities can offer customers a wide range of options to promote energy efficiency, including providing rebates for energy-efficient appliances, weatherising customers’ homes and educating customers on energy saving methods. Overall, entities that sponsor efficiency initiatives may reduce the downside risks from demand fluctuations, gain returns on needed investments, decrease operating costs and earn higher risk-adjusted returns over the long term.
- Materials Sourcing & Efficiency
  The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
  
  None
- Critical Incident Risk Management
  The category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
  - Integrity of Gas Delivery Infrastructure
    Operating a vast network of gas pipelines, equipment and storage facilities requires a multifaceted, long-term approach to ensuring infrastructure integrity and managing related risks. Although customers depend on reliable gas supplies, entities manage substantial risks—including those related to human health, property and greenhouse gas (GHG) emissions—that result from operating gas distribution networks and related infrastructure. Ageing infrastructure, inadequate monitoring and maintenance, and other operational factors may result in gas leaks. Gas leak safety-related risks, such as losses of containment, may result in fires or explosions that can be particularly dangerous in urban areas where entities often operate. Furthermore, gas leaks also result in fugitive emissions (methane), causing adverse environmental impacts. Regulated gas utilities generally incur no direct costs for gas leaks, because the cost of gas typically is passed on to customers (though this may vary by region). However, gas leaks that result in safety-related risks or fugitive emissions may affect entities financially through a variety of regulatory, legal and product demand channels. Accidents, particularly fatal accidents, may result in negligence claims against entities, leading to costly court battles and fines. GHG emissions may result in increased regulatory scrutiny—a critical element directly connected to financial performance, given the importance of regulatory relations—and potential fines and penalties. Importantly, regulated gas utilities can financially benefit from capital investment opportunities to improve performance and mitigate risks related to safety and emissions, which can be factored into their rate base. Entities manage such risks through pipeline replacements, regular inspections and monitoring, employee training and emergency preparedness, investments in technology, and other strategies such as working closely with regulators. In response to concerns about ageing infrastructure, many entities are seeking ways to expedite the replacement permitting and approval process, especially in cases where pipelines are located near densely populated areas.
Fuel Cells & Industrial Batteries Remove
Access Standard
- Energy Management
  The category addresses environmental impacts associated with energy consumption. It addresses the company’s management of energy in manufacturing and/or for provision of products and services derived from utility providers (grid energy) not owned or controlled by the company. More specifically, it includes management of energy efficiency and intensity, energy mix, as well as grid reliance. Upstream (e.g., suppliers) and downstream (e.g., product use) energy use is not included in the scope.
  - Energy Management
    Manufacturing in the Fuel Cells & Industrial Batteries industry requires energy to power machines and cooling, ventilation, lighting and product-testing systems. Purchased electricity is a major share of the energy sources used in the industry and accounts for a notable proportion of the total cost of materials and value added. Various sustainability factors are increasing the cost of conventional electricity while making alternative sources cost-competitive. Energy efficiency efforts may have a significant positive impact on operational efficiency and profitability, especially because many entities operate on relatively low or negative margins. By improving manufacturing process efficiency and exploring alternative energy sources, fuel cell and industrial battery entities may reduce both their indirect environmental impacts and their operating expenses.
- Access & Affordability
  The category addresses a company’s ability to ensure broad access to its products and services, specifically in the context of underserved markets and/or population groups. It includes the management of issues related to universal needs, such as the accessibility and affordability of health care, financial services, utilities, education, and telecommunications.
  
  None
- Employee Health & Safety
  The category addresses a company’s ability to create and maintain a safe and healthy workplace environment that is free of injuries, fatalities, and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.
  - Workforce Health & Safety
    Fuel cell and industrial battery manufacturing workers may be exposed to hazardous substances or workplace accidents that can have chronic or acute health impacts. Entities may face litigation because of injuries or chronic health impacts from working in fuel cell and battery manufacturing or recycling facilities. Entities that develop and implement strong safety processes and internal controls, including through providing health and safety training, protective gear, improved ventilation, and regular health monitoring, can improve workforce health and safety performance and mitigate regulatory and litigation risks.
- Product Design & Lifecycle Management
  The category addresses incorporation of environmental, social, and governance (ESG) considerations in characteristics of products and services provided or sold by the company. It includes, but is not limited to, managing the lifecycle impacts of products and services, such as those related to packaging, distribution, use-phase resource intensity, and other environmental and social externalities that may occur during their use-phase or at the end of life. The category captures a company’s ability to address customer and societal demand for more sustainable products and services as well as to meet evolving environmental and social regulation. It does not address direct environmental or social impacts of the company’s operations nor does it address health and safety risks to consumers from product use, which are covered in other categories.
  - Product Efficiency
    Both customer demand and regulatory requirements are driving innovation in energy-efficient products with lower environmental impacts and lower total cost of ownership. Therefore, research and development in the Fuel Cells & Industrial Batteries industry that drive energy and thermal efficiency and enhance storage capacities may lower barriers to adoption. Advances in battery technology to increase storage capabilities and improve charging efficiencies, while reducing costs for customers, are critical for the integration of renewable energy technologies into the grid. Pressured by stricter environmental regulations, high energy costs and customer preferences, fuel cell and industrial battery manufacturers that improve efficiency in the use phase may increase revenue and market share.
  - Product End-of-life Management
    As the rate of adoption of fuel cells and industrial batteries increases and more products reach their end of life, designing products to facilitate end-of-life management and maximise materials efficiency may become increasingly important. Fuel cells and batteries may contain hazardous substances, which must be properly discarded because they can pose human health or environmental risks. The emergence of several laws regarding the end-of-life phase of batteries recently has increased the importance of the issue, creating potential added costs of managing risks, as well as opportunities, through regulatory incentives. Effective design for disassembly and reuse or recycling will be an important element for increasing recovery rates to reduce the lifecycle impacts of fuel cells and batteries. Furthermore, given the input-price volatility and resource constraints of some raw materials, fuel cell and industrial battery entities that develop take-back and recycling systems and reuse recovered materials in manufacturing may increase their long-term operational efficiency and improve their risk profile.
- Business Model Resilience
  The category addresses an industry’s capacity to manage risks and opportunities associated with incorporating social, environmental, and political transitions into long-term business model planning. This includes responsiveness to the transition to a low-carbon and climate-constrained economy, as well as growth and creation of new markets among unserved and underserved socio-economic populations. The category highlights industries in which evolving environmental and social realities may challenge companies to fundamentally adapt or may put their business models at risk.
  
  None
- Materials Sourcing & Efficiency
  The category addresses issues related to the resilience of materials supply chains to impacts of climate change and other external environmental and social factors. It captures the impacts of such external factors on operational activity of suppliers, which can further affect availability and pricing of key resources. It addresses a company’s ability to manage these risks through product design, manufacturing, and end-of-life management, such as by using of recycled and renewable materials, reducing the use of key materials (dematerialization), maximizing resource efficiency in manufacturing, and making R&D investments in substitute materials. Additionally, companies can manage these issues by screening, selection, monitoring, and engagement with suppliers to ensure their resilience to external risks. It does not address issues associated with environmental and social externalities created by operational activity of individual suppliers, which is covered in a separate category.
  - Materials Sourcing
    Manufacturing some types of industrial batteries and fuel cells requires an available supply of materials such as lithium, cobalt, nickel and platinum. Access to these materials is critical for the continuous development and scaling of clean energy technologies like fuel cells and industrial batteries. Limited global resources of these critical materials, as well as their concentration in countries that may have relatively limited governance and regulatory structures or are subject to geopolitical tensions, expose entities to the risk of supply-chain disruptions and input-price increases or volatility. At the same time, competition from other industries that use the same critical materials or employ fuel cell and battery technologies may exacerbate supply risks. Fuel cell and industrial battery entities with strong supply-chain standards and the ability to adapt to increasing resource scarcity may protect shareholder value better. Entities that reduce the use of critical materials and secure supply of the materials they do use may mitigate potential financial effects because of supply disruptions, volatile input prices, and reputational and regulatory risks.
- Critical Incident Risk Management
  The category addresses the company’s use of management systems and scenario planning to identify, understand, and prevent or minimize the occurrence of low-probability, high-impact accidents and emergencies with significant potential environmental and social externalities. It relates to the culture of safety at a company, its relevant safety management systems and technological controls, the potential human, environmental, and social implications of such events occurring, and the long-term effects to an organization, its workers, and society should these events occur.
  
  None

General Issue Category

Remove Gas Utilities & Distributors Access Standard

Remove Fuel Cells & Industrial Batteries Access Standard

Energy Management

Energy Management
Manufacturing in the Fuel Cells & Industrial Batteries industry requires energy to power machines and cooling, ventilation, lighting and product-testing systems. Purchased electricity is a major share of the energy sources used in the industry and accounts for a notable proportion of the total cost of materials and value added. Various sustainability factors are increasing the cost of conventional electricity while making alternative sources cost-competitive. Energy efficiency efforts may have a significant positive impact on operational efficiency and profitability, especially because many entities operate on relatively low or negative margins. By improving manufacturing process efficiency and exploring alternative energy sources, fuel cell and industrial battery entities may reduce both their indirect environmental impacts and their operating expenses.

Access & Affordability

Energy Affordability
An objective of gas utilities is to deliver natural gas to customers in a safe, reliable and environmentally responsible manner. Entities in the industry manage these potentially competing priorities while maintaining favourable relations with customers and regulators—and ultimately to earn appropriate shareholder returns. From the utility customer perspective, the affordability of energy is challenging to balance, because it often conflicts with other core objectives. Utility energy bills generally are perceived to be increasingly more expensive for low-income customers (affordability is determined by both the net cost of energy bills and the underlying economics of customers). Ensuring utility bills remain affordable is crucial for utilities in building trust (intangible asset value) with regulators and customers. The quality of regulatory relations is an important value driver for utilities, and one of the issues analysed closely by investment analysts. Regulators’ willingness, or lack thereof, to grant rate requests, rate structure modifications, cost recovery and allowed returns is a primary determinant of financial performance and investment risk. Effectively managing affordability may provide opportunities to grow capital investment, revise rate structures favourably and increase allowed returns. Furthermore, utilities that ineffectively manage affordability increasingly face customers reducing their reliance upon natural gas (or reducing energy needs) and pursuing alternative energy sources (for example, industrial customers’ use of combined heat and power). Managing affordability involves operating an efficient business with a comprehensive, long-term strategy, as well as working closely with regulators and public policymakers on rate structures and, potentially, bill-assistance programmes. Although utility business models and rate structures largely determine the precise nature of the financial effects, affordability is a critical business issue for utilities managing, maintaining and growing their customer bases, building intangible asset value, creating investment and return opportunities, and ultimately delivering shareholder returns.

Employee Health & Safety

Workforce Health & Safety
Fuel cell and industrial battery manufacturing workers may be exposed to hazardous substances or workplace accidents that can have chronic or acute health impacts. Entities may face litigation because of injuries or chronic health impacts from working in fuel cell and battery manufacturing or recycling facilities. Entities that develop and implement strong safety processes and internal controls, including through providing health and safety training, protective gear, improved ventilation, and regular health monitoring, can improve workforce health and safety performance and mitigate regulatory and litigation risks.

Product Design & Lifecycle Management

Product Efficiency
Both customer demand and regulatory requirements are driving innovation in energy-efficient products with lower environmental impacts and lower total cost of ownership. Therefore, research and development in the Fuel Cells & Industrial Batteries industry that drive energy and thermal efficiency and enhance storage capacities may lower barriers to adoption. Advances in battery technology to increase storage capabilities and improve charging efficiencies, while reducing costs for customers, are critical for the integration of renewable energy technologies into the grid. Pressured by stricter environmental regulations, high energy costs and customer preferences, fuel cell and industrial battery manufacturers that improve efficiency in the use phase may increase revenue and market share.
Product End-of-life Management
As the rate of adoption of fuel cells and industrial batteries increases and more products reach their end of life, designing products to facilitate end-of-life management and maximise materials efficiency may become increasingly important. Fuel cells and batteries may contain hazardous substances, which must be properly discarded because they can pose human health or environmental risks. The emergence of several laws regarding the end-of-life phase of batteries recently has increased the importance of the issue, creating potential added costs of managing risks, as well as opportunities, through regulatory incentives. Effective design for disassembly and reuse or recycling will be an important element for increasing recovery rates to reduce the lifecycle impacts of fuel cells and batteries. Furthermore, given the input-price volatility and resource constraints of some raw materials, fuel cell and industrial battery entities that develop take-back and recycling systems and reuse recovered materials in manufacturing may increase their long-term operational efficiency and improve their risk profile.

Business Model Resilience

End-Use Efficiency
Natural gas produces fewer greenhouse gas (GHG) emissions than other fossil fuels. Expanding its use in the economy may be an important strategy for many governments and regulators striving to reduce GHG emissions. However, despite the relatively lower emissions, the natural gas value chain still produces meaningful levels of GHG emissions overall. As policymakers and regulators seek to mitigate climate change, the efficient consumption of natural gas will be an important long-term theme. Energy efficiency is a low-lifecycle-cost method to reduce greenhouse gas (GHG) emissions. Utilities can offer customers a wide range of options to promote energy efficiency, including providing rebates for energy-efficient appliances, weatherising customers’ homes and educating customers on energy saving methods. Overall, entities that sponsor efficiency initiatives may reduce the downside risks from demand fluctuations, gain returns on needed investments, decrease operating costs and earn higher risk-adjusted returns over the long term.

Materials Sourcing & Efficiency

Materials Sourcing
Manufacturing some types of industrial batteries and fuel cells requires an available supply of materials such as lithium, cobalt, nickel and platinum. Access to these materials is critical for the continuous development and scaling of clean energy technologies like fuel cells and industrial batteries. Limited global resources of these critical materials, as well as their concentration in countries that may have relatively limited governance and regulatory structures or are subject to geopolitical tensions, expose entities to the risk of supply-chain disruptions and input-price increases or volatility. At the same time, competition from other industries that use the same critical materials or employ fuel cell and battery technologies may exacerbate supply risks. Fuel cell and industrial battery entities with strong supply-chain standards and the ability to adapt to increasing resource scarcity may protect shareholder value better. Entities that reduce the use of critical materials and secure supply of the materials they do use may mitigate potential financial effects because of supply disruptions, volatile input prices, and reputational and regulatory risks.

Critical Incident Risk Management

Integrity of Gas Delivery Infrastructure
Operating a vast network of gas pipelines, equipment and storage facilities requires a multifaceted, long-term approach to ensuring infrastructure integrity and managing related risks. Although customers depend on reliable gas supplies, entities manage substantial risks—including those related to human health, property and greenhouse gas (GHG) emissions—that result from operating gas distribution networks and related infrastructure. Ageing infrastructure, inadequate monitoring and maintenance, and other operational factors may result in gas leaks. Gas leak safety-related risks, such as losses of containment, may result in fires or explosions that can be particularly dangerous in urban areas where entities often operate. Furthermore, gas leaks also result in fugitive emissions (methane), causing adverse environmental impacts. Regulated gas utilities generally incur no direct costs for gas leaks, because the cost of gas typically is passed on to customers (though this may vary by region). However, gas leaks that result in safety-related risks or fugitive emissions may affect entities financially through a variety of regulatory, legal and product demand channels. Accidents, particularly fatal accidents, may result in negligence claims against entities, leading to costly court battles and fines. GHG emissions may result in increased regulatory scrutiny—a critical element directly connected to financial performance, given the importance of regulatory relations—and potential fines and penalties. Importantly, regulated gas utilities can financially benefit from capital investment opportunities to improve performance and mitigate risks related to safety and emissions, which can be factored into their rate base. Entities manage such risks through pipeline replacements, regular inspections and monitoring, employee training and emergency preparedness, investments in technology, and other strategies such as working closely with regulators. In response to concerns about ageing infrastructure, many entities are seeking ways to expedite the replacement permitting and approval process, especially in cases where pipelines are located near densely populated areas.

Relevant Issues for both Industries (7 of 26)

Select up to 4 industries