2004 Community and Environmental Report PPL Corporation
This is the 2004 Community and Environmental Report for PPL Corporation (NYSE: PPL). Based in Allentown, Pa., PPL controls about 11,500 megawatts of generating capacity in the United States, sells energy in key U.S. markets and delivers electricity to nearly 5 million customers in Pennsylvania, the United Kingdom and Latin America.
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the answer.
n a crisp fall morning in Maine, an unlikely
coalition gathered along the
Penobscot River to unveil a most unusual project. Environmentalists, an Indian tribe,
government regulators, Þshing enthusiasts and the owner of hydroelectric dams – the kind of people who don’t always agree on river issues – on this day spoke as one. Their announcement made national headlines. Two hydroelectric dams would be demolished and a third bypassed, clearing the way for migrating salmon to return to 500 miles of Maine rivers. The beneÞts to the salmon are clear. But why would an electric company agree to give up three operating hydroelectric dams? If you know PPL Corporation, you know
“Successful companies invest in environmental value in ways that build shareowner value. Going beyond compliance, in a targeted way, with good cost discipline, in a businesslike and productive manner, positions us for long-term success.”
William F. Hecht Chairman, president and chief executive officer PPL Corporation
We did it because we believe in working hard to Þnd solutions to even the most difÞcult challenges. We know that we can improve the environment while generating electricity and proÞts. In fact, we’re convinced that the most environmentally sensitive companies also are among the most proÞtable.
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“For 10,000 years, we have drawn our sustenance, culture and identity from this river that bears our name. We are grateful for PPL’s cooperation in this historic agreement to restore the Atlantic salmon.”
Barry Dana Chief, Penobscot Indian Nation Indian Island, Maine
he salmon restoration project is remarkable because of its cooperative nature. Elsewhere, environmental and power generating interests are bitterly divided over the future of hydroelectric dams. But not in Old Town, Maine. PPL started the discussions, working for two years with the federal government, state government ofÞcials, environmental groups and the Penobscot Indian Nation to forge the agreement. The group has a Þve-year option to purchase the dams for $25 million. Two would be demolished and one would be bypassed. PPL agreed to improve Þsh passages at its other dams as well. There are signiÞcant beneÞts for everyone involved: • The Penobscot Indians, whose traditional salmon Þshing rituals faded when dams blocked the river, would reclaim their Þshing heritage. • Environmental groups like the Atlantic Salmon Federation and Trout Unlimited can count this agreement as a major victory in their nationwide effort to restore migratory Þshes to American rivers.
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• Fishing enthusiasts, and the guides and suppliers who beneÞt from their sport, will enjoy a revived salmon migration. • Towns along the river will get economic development assistance to attract new industries, jobs and tax revenues to replace those lost when the dams are demolished. • PPL will be paid full value for the dams, and has the option to increase generation at its other dams in Maine to replace the lost generating capacity.
“The Penobscot River Restoration Project will improve access to more than 500 miles of habitat to sea-run fish, improve water quality, boost wildlife and create new opportunities in communities along New England’s second largest river.”
Laura Rose Day Spokesperson for coalition buying the dams
PPL Environmental Policy
PPL conducts its business in an environmentally responsible manner. Personal Responsibility
Living up to our environmental policy is every employee’s responsibility.
Continual Improvement
We monitor and assess our environmental performance, and set measurable targets that result in continual improvement.
Resource Commitment
We provide the human and financial resources necessary to carry out our environmental policy.
Innovation
We take creative and proactive approaches in carrying out our environmental policy.
Communication
We openly communicate our environmental values, actions, performance and policy and listen to the concerns of our stakeholders. We provide environmental education opportunities to our employees, customers and the public.
Compliance
We will meet or exceed all applicable environmental laws, regulations and the voluntary standards we have adopted.
Stewardship
Our corporate culture promotes conservation of natural resources, pollution reduction and protection of the environment.
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“There is a direct correlation between environmental performance and stock market performance, because good environmental performance is an indication of excellent management.”
Carla Tabossi
Senior Research Analyst Innovest Strategic Value Advisors New York, New York
serious environmental commitment
At PPL, we recognize that we have an obligation to do business in an environmentally responsible manner. We have a very positive environmental story to tell – signiÞcant reductions in power plant emissions and aggressive cleanups of contaminants from past operations. We support wildlife restoration, promote renewable energy sources, encourage energy efÞciency, reuse
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the ash from our power plants and maintain a comprehensive environmental management program to continuously improve. At PPL, complying with environmental laws is just the beginning. In some cases we go beyond compliance. We work hard to strike the right balance between environmental stewardship and our Þscal responsibilities to our shareowners and to the customers who use our energy.
PPL Project Earth We are focusing our corporate resources on energy, the environment and our communities through a program we call PPL Project Earth. It’s our way of providing energy responsibly, our way of balancing commitment to the environment and communities with our responsibility to shareowners and customers.
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“We’re delighted to have PPL as an education partner. PPL employees have been an integral part of our middle school mentoring program.”
Mardie Tuttle
Coordinator, BusinessEducation Partnerships Crete-Monee School District Crete, Illinois
serious commitment to community
We also recognize our commitment to the communities where we do business. It starts with managing the land resources around our generating plants. We maintain environmental preserves and nature areas, and we sponsor education programs throughout the year. We also support the community through donations – from the company and from our employees – to United Way, to low-
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income energy assistance for customers and to other worthy causes. With our endorsement, PPL employees volunteer thousands of hours to support education and community projects. We listen to our neighbors when they raise concerns about our operations. And, we support the community through economic development, helping to create jobs and improve the quality of life where we do business.
“On many occasions we are working either in the dark or during poor weather conditions, so it is really important that people can see us. This donation of high visibility jackets from WPD (PPL’s electric distribution company in the United Kingdom) is greatly appreciated.”
Ed Sawkins Severn Area Land and Sea Restoration Rescue Bristol, England
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Snapshots of Stewardship
Just a few examples of how we care for the environment and our communities
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“Great joy arrived in little boxes for those who otherwise lacked economic means — thanks to the Mission Good Night food campaign conducted by employees of Emel (PPL’s Chilean subsidiary).”
Cardinal Francisco Javier Errázuriz Archbishop of Santiago
eading a schoolyard cleanup Coal tar was a byproduct of manufactured gas plants that made cooking and heating fuel in the 1800s and early 1900s. As our company grew, we acquired a number of these properties, and later sold some of them. Recently, we led the cleanup at a property once owned by PPL but now occupied by an elementary school in Sunbury, Pa.
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oluntarily cutting power plant emissions We will signiÞcantly reduce sulfur dioxide emissions from our Martins Creek, Pa., power plant under a voluntary agreement with the New Jersey and Pennsylvania Departments of Environmental Protection. The plant’s two coal-Þred generating units will be shut down by September 2007.
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eaching people about the environment We opened a new, 12,000-square-foot environmental learning center at our Lake Wallenpaupack environmental preserve near Hawley, Pa., in 2003. This $1.7 million facility features a 160-seat auditorium for teacher workshops and seminars, a science laboratory for students to study the lake’s water quality,
“We applaud PPL for choosing to make voluntary emission reductions at its Martins Creek, Pa., power plant. These reductions will provide greater protection of public health and the environment.”
Kathleen A. McGinty Secretary, Pennsylvania Department of Environmental Protection Harrisburg, Pennsylvania
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a resource library with Internet access for nature study and research projects, and a lending library with environmental education materials.
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romoting wind power
We are supporting a proposed wind farm in Pennsylvania by agreeing to purchase electricity from the facility when it begins operating. The 20-megawatt wind power project in northeastern Pennsylvania is expected to produce enough electricity to power 5,500 homes. The Sustainable Energy Fund of Central Eastern
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Pennsylvania, initially funded with $20 million from PPL, helped pool resources to fund the project.
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little elbow grease for a good cause PPL employees, coordinated by our Community of Volunteers program, renovated athletic Þelds and a basketball court and built a new playground at the Berryhill Boys and Girls Club in Harrisburg, Pa. Berryhill also beneÞted from PPL’s donation to the club of 14 computers. There are more than 1,600 employee and retiree volunteers in PPL’s Community of Volunteers program.
“I am very impressed with the commitment of PPL and its employees who are volunteering their time to renovate the Berryhill Boys and Girls Club. You are truly special, and the children served by this organization will benefit from your gift of time and resources.”
Aaron Wilson Former Commissioner, Pennsylvania Public Utility Commission Harrisburg, Pennsylvania
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spirit of commitment to the community Debra Beartusk Dove is a director of the Boys and Girls Club of the Northern Cheyenne Nation, an organization that serves about 600 children from 5 to 18 years old in Lame Deer and Ashland, Mont. She grew up in Lame Deer, a community on the Northern Cheyenne Reservation about 20 miles from PPL’s Colstrip plant, where she now works as an administrative assistant.
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ore than just a building The Leadership in Energy and Environmental Design (LEED) program of the U.S. Green Building Council has awarded a gold rating for PPL’s new ofÞce building in Allentown, Pa., the Plaza at PPL Center. It’s a dramatic glass-enclosed building with a spacious plaza that returns open space to the downtown. The building contains a long list of environmental features including a vegetative roof and innovative water- and energysaving Þxtures.
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romoting renewable and alternative energy Fuel cells and renewable energy projects are a growing part of our generation portfolio. Fuel cells use natural gas to generate electricity with no combustion. So far, we have installed them in two hotels and a college in New Jersey, at a data center in Montana, and at a U.S. Coast Guard station in Massachusetts. Other renewable energy projects completed or under development include gas-to-electricity projects at New Jersey and Pennsylvania landÞlls and a wind farm in Pennsylvania. PPL generates about 7 percent of its energy from renewable sources such as hydroelectric generation and landÞll gas.
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classroom lesson
on conservation To commemorate Earth Day 2003, PPL volunteers spent the week making energy conservation presentations to third-, fourthand Þfth-graders in more than 30 classrooms across Pennsylvania’s Lehigh Valley. While these PPL volunteers were inside teaching, others spent a day outside improving the trails and scenic areas of Mosser Woods, a 21-acre environmental preserve at an innercity elementary school in Allentown, Pa.
PPL Community Affairs Principles
PPL will contribute to the quality of the communities where we do business. We will direct initiatives that go beyond the traditional boundaries of corporate community service and involvement. Our Neighbors
We will seek to understand environmental and community issues through a consistent dialogue with neighbors.
Community Involvement
We will support employee involvement in areas that benefit the employee and the community and support company objectives.
Education
We will collaborate with educators and strategic partners to provide educational opportunities for students.
Philanthropy
We will direct corporate resources to programs that improve our communities and make business sense.
Workforce Development
We will seek opportunities to prepare tomorrow’s workers.
Recreation and the Environment
We will preserve natural areas to create recreational and educational opportunities for our neighbors.
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etting the grass grow We stopped mowing the grass at our Susquehanna nuclear power plant along the Susquehanna River in Berwick, Pa., an unorthodox move that is improving water quality and enhancing wildlife habitat. The taller vegetation with its more extensive root system stabilizes the soil and minimizes storm water runoff into a nearby public recreation area, the Susquehanna River and ultimately the Chesapeake Bay.
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rotecting wilderness areas Working in partnership with state environmental agencies and others, PPL agreed to transfer mineral rights for thousands of acres of state forest land in Pennsylvania. The oil, gas and mineral lease for the 13,600-acre property dated back to the 1930s. Today, thanks to the efforts of PPL, the pristine nature of this land will be preserved.
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ur work continues We recognize that generating electricity by burning coal and other fossil fuels has an impact on the environment. We are working tirelessly to minimize that impact as part of our commitment to the environment and to the communities where we do business. We share the desire for cleaner sources of energy. We’ve built new power plants Þred by clean-burning natural gas. We have increased the number of hydroelectric dams in our generating portfolio. We have entered a partnership with the developer of a wind farm in Pennsylvania. And, we have promoted and installed fuel cells that produce clean energy from hydrogen. Our coal-Þred power plants are cleaner today than they were yesterday, and will be cleaner tomorrow than they are today. We have reduced our emissions of key pollutants signiÞcantly, but more work remains to be done. We will conGas/Oil 33% Coal 39% Nuclear 18%
PPL Power Supply by Fuel Source
(generating capacity)
Hydro and renewables 7%
Other 3%
tinue to focus on greenhouse gas emissions that lead to global climate change, trace air emissions, groundwater contamination from natural compounds in coal ash and Þne particulate emissions. We also will continue to clean up contaminated sites where necessary, and will continue to help communities put these sites to good use.
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Air Emissions
About 70 percent of our nation’s electricity is generated by burning coal and other fossil fuels. And while PPL and others are working on Þnding cleaner ways to meet our customers’ increasing demand for electricity, we expect that fossil fuels will continue to play a major role for some time to come. We have taken steps that resulted in signiÞcant reductions in the emissions rate of nitrogen oxide and sulfur dioxide since 1990. We’re proud of the work we have done to improve the air quality near our power plants, and we intend to continue this work. The increase in the sulfur dioxide emission rate in 2003 versus 2002 is due to normal variation in sulfur content of the coal we burn at our power plants.
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TRI Substances
The Toxics Release Inventory, or TRI, is a public database maintained by the U.S. Environmental Protection Agency. It tracks the release of certain substances by industrial facilities like power plants. PPL’s emissions of substances listed in the database include hydrochloric acid and sulfuric acid aerosols and hydrogen ßuoride. Some of these substances occur naturally in coal.
Low-level Radioactive Waste
As a normal part of maintenance and repair activities at a nuclear power plant, protective clothing, tools and other materials become contaminated with radioactive materials. At PPL, this “low-level waste” is disposed of properly, using approved methods. The increase in 2003 versus 2002 is because of additional plant maintenance work performed during 2003, and because some waste processed in 2002 was not disposed of until 2003. Low-level waste does not include used uranium fuel for the plant, which PPL is storing safely and properly on the plant site until the U.S. government fulÞlls its obligation to provide a permanent storage facility.
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Environmental Penalties Paid
Reducing environmental penalties is a priority at PPL. Our goal is to meet or exceed all applicable environmental laws and regulations. The increase in 2001 penalties was due to opacity exceedances at our Martins Creek, Pa., power plant. Corrective action has been taken.
Hazardous Waste
As a normal part of doing business at power plants and other industrial facilities, PPL generates a certain amount of hazardous waste. This includes boiler cleaning waste, used dust-emission Þlters and cleaning solvents. We dispose of this waste carefully and properly, following all procedures set forth by regulatory agencies. The increase in 2003 over 2002 levels was due primarily to a boiler cleaning project at our Montour power plant in Pennsylvania.
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Giving Back to Our Communities
It’s easy for a company to say it cares about its communities. At PPL, the proof is in the statistics – 188,000 employee hours donated to volunteer causes, $1.9 million in United Way contributions, half a million visitors to our recreational facilities, and nearly 15,000 teachers, school students and others who beneÞtted from our education outreach programs in 2003.
2003 Recreation Activity Attendance 44,665 96,179
245,388 36,995
24,037 Boating Hunting Picnicking Camping Fishing 6,779
2003 Education Program Attendance 1,187 487 6,236
Public Programs Schools Teacher Workshops Community/Civic Groups
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Dear Reader: We hope that through the pages of this report, you have learned about the extraordinary commitment of PPL Corporation to our communities and to the natural environment. This commitment is more than just words on paper. It’s evident in the actions we take, day in and day out, in our operations from Maine to Montana to Latin America to the United Kingdom. For additional copies of this report, e-mail us at pplprojectearth@pplweb.com. For more information, or to review our latest report to CERES, a coalition of environmental, investor and advocacy groups of which we are a member, visit our Web site at www.pplweb.com/community/. Robert J. Barkanic Manager-Environmental Management Luis A. Ramos Manager-Community Affairs
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PPL Corporation Two North Ninth Street Allentown, PA 18101-1179 www.pplweb.com
This report is printed on recycled paper using soy-based inks and is recyclable