Task Force on Climate-related Financial Disclosures (TCFD) Report

 

 

The Task Force on Climate-related Financial Disclosures (TCFD) provides a framework of recommended disclosures for corporate reporting on climate-related risks and opportunities – categorized by Governance, Strategy, Risk Management, and Metrics & Targets.

Inclusion of information in this report should not be construed as a characterization of the materiality or financial impact of that information. Please see our Corporate Annual Report or Form 10-K for the year ended December 31, 2020 and other publicly-filed documents available on the AT&T Investor Relations website.

 
“Our network is tested by climate change and natural disasters every year. We recognize the long-term impacts [our] commitments can have, and we owe it to the millions of customers who rely on our services to create the most resilient and sustainable business we can.”

 – John Stankey, Chief Executive Officer, AT&T

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Board of Directors Oversight

AT&T recognizes that climate change can present risks and opportunities to our business, employees and communities. The Public Policy and Corporate Reputation Committee (PPCRC) of the AT&T Board of Directors (Board) meets 3-4 times per year to assist the Board in oversight of environmental, social and governance (ESG)-related policies and issues affecting AT&T – including our climate resilience efforts and ESG reporting.

The PPCRC provides feedback on the entirety of AT&T’s climate-related strategy, including applicable public targets and policies governing our supply chain, fleet, consumption of water and electricity, and investments in renewable energy. Members of the PPCRC come from diverse professional and cultural backgrounds, giving them the experience, depth of knowledge, judgment and vision to challenge our assumptions and continuously improve our work.

In addition to regular discussions with individual PPCRC members, our Senior Vice President – Corporate Social Responsibility (CSR), who is our Chief Sustainability Officer (CSO), formally presents and participates in PPCRC meetings.

The Audit Committee of the Board oversees our internal audit of ESG reporting and our planned integration of ESG issues into corporate enterprise risk management analysis.

For more information, see our Climate Change and Our Corporate Governance issue briefs, our Board of Directors Committees and Charters and our CDP Response (question C1.1b).

att-governance

Business Management

Our CSO oversees AT&T’s climate-related risks, opportunities and strategy-setting process, and receives weekly updates on climate-related activities and developments throughout the business.

Our CSR Governance Council (Council) is led by our CSO and is comprised of more than a dozen officers representing each of our operating companies and departments with responsibility for business operations aligned to our most important ESG focus areas, such as climate change, emissions and use of energy and water resources. The Council meets 3–4 times per year and collaborates across a broad range of initiatives, competencies and perspectives.

In addition to the Council, we convene 5 core issue committees led by senior CSR management – including a committee focused on environmental issues, led by our Assistant Vice President (AVP) – Global Environmental Sustainability, a direct report to our CSO.

Members of our global environmental sustainability team, also led by our AVP – Global Environmental Sustainability, monitor internal and external climate-related developments and work closely with business unit experts throughout our operating companies to implement and enhance programs and policies addressing climate-related risks and opportunities for AT&T.

AT&T’s Climate Change Policy explains how we measure and manage our approach to the impacts of climate change. We must continually strive to help our customers be more sustainable, reduce our own greenhouse gas (GHG) emissions and increase resilience throughout our operations.

Our Energy Policy outlines our commitment to the efficient, cost-effective and environmentally responsible use of energy while maintaining or improving quality, reliability, productivity and safety.

Our ESG reporting is internally validated by our internal finance and audit teams, and we plan to integrate ESG topics identified through our regularly occurring stakeholder assessment into our Q4 2021 corporate enterprise risk management analysis.

 

Climate-related Ties to Leadership Compensation

Demonstrated progress toward and achievement of climate-related goals and programs (such as our approved science-based carbon reduction targets, 2035 carbon neutral goal, gigaton customer GHG emissions reduction goal and programs for adoption of renewable energy) are part of the annual performance objectives for our CSO and our AVP – Global Environmental Sustainability. Our VP of Global Infrastructure Implementation, Provisioning and Optimization – who has responsibility for our energy management team – has financial energy-saving targets which also support our sustainability efforts.

Performance toward such goals is taken to account when these individuals’ supervisors determine annual merit salary increases and bonus awards.

For more information, see our Climate Change and Our Corporate Governance issue briefs and our CDP Response (questions C1.2 and C1.2a).

 

Climate-related Risks

To help us better understand AT&T’s positioning to respond to climate change, we assess the potential impacts and magnitude of climate-related risks and opportunities on our operations – including physical network infrastructure, our products and services, and our brand. AT&T also assesses transition-related risks, such as how environmental regulations, developments in technology and market or reputational factors could affect our company. Such risks are analyzed through our company-wide internal risk management processes, in collaboration with business units such as compliance, finance, legal, public policy and others.

The below time horizons reflect how AT&T looks at the impacts of climate change through our Climate Change Analysis Tool (CCAT), which enables us to analyze the long-term physical impacts of climate change on our network and operations up to 30 years into the future:

Short-term

0-3 years

Medium-term

3-10 years

Long-term

10-30 years

Physical Risk – Rising mean temperatures

Summary

Time Horizon

Long-term

Description

AT&T uses billions of gallons of water in our operations each year, primarily in systems to cool our larger facilities. To a lesser degree, we use water for consumption, sanitation and landscape irrigation. Over the long-term, an increase in the mean global temperature could impact our operating costs by requiring more resources to water-cool our facilities or otherwise support operations.

Impact to Business & Management Approach

Increased indirect (operating) costs

Since 2013, we’ve spent more than $1 million related to water management projects, including smart irrigation. We’ve realized cumulative water savings of 596 million gallons, allowing us to exceed our goal to reduce water consumption relative to data growth on our network 60% by 2020 (2013 baseline) – a year ahead of schedule.

We work with HydroPoint – a provider of smart water management solutions – to remotely monitor & manage irrigation systems in real-time. Since 2017, AT&T has launched 141 smart water facilities with HydroPoint. And in 2020, we saved 60 million gallons of water through this program.

In addition, we have realized 794M kWh of annualized electricity savings associated with the introduction of free-air cooling projects and the reduction of mechanical refrigeration.

In 2020, AT&T expanded the deployment of our Enterprise Building Management System (EBMS) to nearly 985 facilities. Leveraging the Internet of Things (IoT) and Big Data principles, our EBMS is designed to help property management personnel ensure facility equipment is operating optimally. This effort helps minimize mechanical cooling needs and reduces water consumption.

In 2021, we launched a new goal to reflect our commitment to using critical water resources efficiently. By 2030, we aim to achieve a 15% reduction (2019 base year) in U.S. water use in areas of high or extremely high-water stress.

Physical Risk - Acute physical increases in the severity and frequency of extreme weather events

Summary

Time Horizon

Long-term

Description

Extreme weather events such as the active tropical storm season along the gulf and Atlantic coasts, and the unprecedented number of wildfires in 2020 across the Western U.S., have the potential to directly damage our network facilities or disrupt our ability to maintain portions of our network. Disruption to our fiber routes or other network infrastructure – including cell towers, central offices or other physical assets – because of extreme weather events such as hurricanes, wildfires, cyclones, floods or other natural disasters may impact network performance and reliability. This could lead to increased capital or operating costs for repairing damage, proactively relocating equipment or implementing network hardening solutions to better prevent future disruptions. In addition, severe or repeated impacts to our network reliability or performance may negatively impact our reputation and the perception of our brand – influencing customers to cancel services, subsequently reducing company revenue.

Impact to Business & Management Approach

Increased indirect (operating) costs

We proactively monitor potential nature-related threats to our network, employees and communities through our AT&T Weather Operations Center.

Our network team builds all cell sites to meet or exceed local structural standards—including those in disaster prone areas. We conduct regular analysis to help ensure cell sites can withstand wind, ice & other environmental factors. We also deploy high-capacity battery backup to these sites, helping maintain service in the event of a power loss. To prepare for natural disasters, we regularly test on-site batteries & take steps to ensure fixed generators are fueled on a regular basis.

We have invested >$650M in our domestic and international Network Disaster Recovery (NDR) programs since 1992. Investments include capital expenditures such as building mobile satellite cells on light trucks, as well as operational expenditures such as field training exercises. Through the end of 2020, our NDR organization has conducted 78 full-scale in-field recovery exercises, which are vital to testing our equipment & abilities.

Since 2018, we’ve been working with the U.S. Department of Energy’s Argonne National Laboratory to build out our Climate Change Analysis Tool (CCAT). The tool helps us anticipate & visualize potential impacts of climate change, such as flooding and intense winds, on our network infrastructure & operations at the neighborhood level – up to 30 years into the future. This information can be used to help plan for maintenance and future construction or disaster recovery needs. In 2020, we began expanding CCAT from four pilot states in the Southeast to the entire contiguous U.S. We’re also adding analysis capabilities for more climate-related weather events, such as wildfires and droughts.

We’re also investing in programs like our Climate Resiliency Community Challenge and the National Fish and Wildlife Foundation’s National Coastal Resilience Fund. These projects complement our internal climate adaptation efforts by making the communities we serve more resilient, as well.

Transition Risk – Potential emerging regulation

Summary

Time Horizon

Medium-term

Description

Regulatory risks related to policies that increase in the price of GHG emissions, such as through a fuel or carbon tax or other pricing mechanism, may marginally drive up the price of fossil fuel-based energy and increase our operating costs. AT&T relies in part on fossil fuel-based resources for our fleet and to provide backup power for our network. We also purchase a significant amount of electricity to power our network and general operations. While we are working to increase the amount of renewable electricity in our portfolio, we still rely on the grid and non-renewable sources to fulfill our energy needs.

Impact to Business & Management Approach

Increased indirect (operating) costs

AT&T has both a financial and an environmental incentive to reduce our energy consumption. Reducing our energy usage helps us mitigate risks associated with changes in energy prices, and we have active energy management efforts underway.

In 2020, we invested more than $100 million to implement approximately 8,800 energy projects resulting in gross annualized cost savings of nearly $40 million. Since 2010, we have implemented nearly 147,000 energy efficiency projects, resulting in annualized energy savings of nearly 7.6 billion kWh and gross annualized cost savings of $694 million.

We exceeded our 2020 target to reduce the emissions of our U.S. fleet by 30%. Through the end of 2020, our U.S. ground fleet emissions decreased 332,658 MT CO2e – or 38.4% – from our 2008 baseline. In addition to reducing the size of our domestic fleet by more than 8,000 vehicles, 81% of passenger sedans procured for our domestic fleet since 2019 have been hybrids.

For more information, see our Climate Change issue brief and our CDP Response (questions C2.1a, C2.3, C2.3a).

 

Climate-related Opportunities

In addition to identifying ways we can adapt our operations and mitigate our own potential climate-related risks, AT&T is continually exploring opportunities to enable solutions that can help our customers and communities address climate change and transition to a net-zero economy.

Information and Communication Technology (ICT) solutions – including hardware, software and broadband wireline and wireless technologies – can enable consumers and businesses to make more energy-efficient choices and reduce environmental impacts in many ways. The Global Enabling Sustainability Initiative’s (GeSI) SMARTer2030 report found that the increased use of ICT solutions can enable a 20% reduction of global CO2 emissions by 2030, holding GHG emissions at 2015 levels – an avoidance of 12.08 gigatons of carbon dioxide equivalent (CO2e) emissions. This translates into a benefit 9.7 times higher than ICT’s own carbon emissions footprint in the same period. The report also found that ICT solutions have the potential to generate more than $11 trillion in economic benefits by 2030.1

1 The Global e-Sustainability Initiative (GeSI) SMARTer2030 report: http://smarter2030.gesi.org/

Opportunity – Products and services

Summary

Time Horizon

Short-term

Description

Through the sale of products and services that enable emissions reductions for our customers, we see an opportunity to drive revenue increases.

We have long believed that connectivity can create increased visibility that allows businesses to run more efficiently. In the years since we set our 10x customer carbon savings goal, we’ve shown that AT&T connectivity solutions such as IoT connectivity and 5G have the power to reveal inefficiencies and reduce wasted electricity, fuel, water and/or raw materials, which can lead to reduced GHG emissions. Recently, we have announced a new goal to deliver connectivity solutions that enable business customers to reduce a gigaton (1 billion metric tons) of GHG emissions by 2035.

We recognize that we will need to invest in efforts to stimulate collaboration and innovative applications of AT&T connectivity to enable emissions reduction. To that end, we have invested in research with leading universities to explore how 5G can enable remissions reduction. We’ve engaged independent, credible third parties to facilitate customer co-development sessions to identify opportunities for emissions reduction. And we’ve invested in communications, marketing and sales tools that help support the engagement with customers in these efforts. We will continue to evaluate other opportunities to increase the ways that our connectivity solutions can enable our customers to meet their emissions reduction goals.

Read more about our calculation methodology, progress report and case studies at www.att.com/gigaton.

Impact to Business & Management Approach

Development and/or expansion of low emission goods and services; Increased revenues resulting from increased demand for products and services.

As we identify and measure the impact of new, AT&T-enabled solutions, we are developing case studies and highlighting the impacts for our customers. Our case studies quantify the GHG emissions reduction potential that AT&T technology enables in a wide range of impact areas, such as rice farming, smart buildings, energy efficient network equipment and pipeline leak detection. Using these real-world examples allows us to turn the idea of tech-enabled GHG emissions reductions into a relatable story for other customers. We expect that these concrete examples can help engage more customers and technology collaborators to develop and sell more of these types of solutions.

AT&T has set public goals to help us seize this climate-related revenue generating opportunity, such as our new goal to deliver connectivity solutions that enable business customers to reduce a gigaton (1 billion metric tons) of greenhouse gas emissions by 2035.

Meeting global climate goals requires immense collaboration. AT&T is applying its global reach, resources and scale to form a new Connected Climate Initiative (CCI) with leading technology companies, AT&T business customers, universities and environmental nonprofits. Through the CCI, we will work with businesses including Microsoft, Equinix and Duke Energy, along with research universities and a range of other organizations, to deliver broadband-enabled climate solutions at global scale.

Opportunity – Access to new markets

Summary

Time Horizon

Short-term

Description

Our technology solutions such as IoT connectivity have the power to reveal inefficiencies and reduce wasted electricity, fuel, water and/or raw materials, which can lead to reduced GHG emissions across multiple markets, including areas in which AT&T has an opportunity to introduce new technologies. AT&T is uniquely positioned to deliver many of these benefits to our customers because of our scope and expertise. For example, AT&T’s 5G network is live across the U.S., supporting our ability to bring connectivity technology to more areas and markets. In addition, we use many of these technology solutions in our own operations, so we bring practical experience to our customers.

We believe that collaborating with our customers on AT&T-integrated technology solutions can create new opportunities for AT&T to introduce technology into new industries and markets, such as Smart Cities, industrial, manufacturing, retail, supply chain and transportation.

Impact to Business & Management Approach

Increased revenues through access to new and emerging markets.

We have identified 8 key impact areas that have substantial climate impact and could benefit from operations enhanced by our technology: Modern Workplace, Transportation, Healthcare, Consumer/Retail, Smart Cities/Buildings, Energy, Industrial, Food/Beverage & Agriculture.

IoT is the connection of everyday objects and machines so they work seamlessly together across modern networks. IoT solutions are one of the ways AT&T’s products and services can help customers enhance their climate mitigation and resilience. AT&T is helping companies of all sizes develop or deploy IoT solutions that can help lower costs, gain efficiencies and improve competitive advantage.

To capitalize on such opportunities, we work with customers to create case studies showing how our technologies have enabled positive environmental impacts. For example, our customer ChargePoint uses AT&T connectivity to scale access to electric vehicle charging stations and reduce greenhouse gas emissions. As of March 2020, ChargePoint used AT&T connectivity at approximately 37,000 stations – enabling their customers to avoid the use of over 15.5 million gallons of gasoline, which is equivalent to almost 138,000 metric tons of avoided CO2e emissions.

In another case study, we highlighted how a customer’s use of remote pipeline monitoring technology, relying on AT&T IoT connectivity, allows operators to avoid inspection-related travel while identifying leaks quickly – both of which reduce emissions. Our case study showed AT&T IoT technology helped decrease gasoline usage nearly 22,000 gallons and enabled savings of approximately $300,000 in fuel and labor costs.

AT&T uses IoT solutions for our internal operations, as well. To optimize energy use in our buildings, we implemented a solution that uses AT&T connectivity to obtain performance data from facility equipment across the U.S. We manage such data centrally, allowing us to create performance baselines, monitor equipment status and identify required maintenance in real time. This contributes to significant reductions in unnecessary energy use and maintenance costs.

In addition, technological change driven by faster, more efficient networks represents a fundamental shift in how industries operate. The expansion of high speed, low latency 5G networks can enable greater visibility to monitor equipment and infrastructure, allowing for enhanced management of resources such as electricity, fuel, water and raw materials.

For example, 5G can help reduce wasted energy and greenhouse gas emissions at a manufacturing plant by enabling:

  • Optimal equipment performance, even in spaces with many devices and connections.
  • Predictive analytics to detect and address quality issues that could cause unnecessary waste.
  • Video analytics to monitor analog equipment and identify an energy-wasting issue.
  • Augmented reality to safely and quickly identify inefficiency-causing leaks.
  • Artificial intelligence and machine learning to create automated responses to ensure equipment is running optimally.
  • Near real-time device management to power devices on and off as needed, avoiding wasted energy.

We use case studies such as these for IoT and 5G solutions as marketing and promotional content to show the climate-related benefits of AT&T technologies and services. The case studies quantify the GHG emissions reduction potential that AT&T technology enables in a wide range of impact areas, and we expect these examples can help expand the conversations we have with our customers.

Opportunity – Resource efficiency

Summary

Time Horizon

Long-term

Description

Water is deeply important to the communities we serve and to our own operations. In 2020, AT&T used 2.678 billion gallons of water in our operations. The network that forms the core of our business requires a controlled and cooled environment, and water is a critical input to the cooling equipment we use to create these conditions.

We’re working to manage our own water use, while at the same time supporting the development of water management technology for customers and other organizations. Analysis of our water footprint has shown that our top 125 water-consuming facilities constitute almost 60.9% of our overall water consumption.

One of the ways in which we address our water usage is to apply our own IoT solutions, including Smart Irrigation.

Impact to Business & Management Approach

Reduced water usage and consumption; Reduced direct costs.

We have active water management efforts to reduce our consumption, and in 2019 met our goal to reduce water consumption relative to data growth on our network 60% by the end of 2020 (2013 baseline) – a year ahead of schedule. In 2020, we further reduced our water consumption by 11% compared to 2019. And in 2021, we launched a 2030 goal to achieve a 15% reduction (2019 base year) in U.S. water use in high- or extremely high-water stress areas.

To address water use, in 2017 we installed the AT&T Smart Irrigation solution on AT&T campuses and buildings in 9 states. The solution allows us to use near real-time weather data to identify specific watering needs for the plants in each zone at each site, so we can provide the right amount of water at the right time. Smart Irrigation also monitors the flow of water, enabling us to detect leaks in pipes. If there is a leak, the system turns off that zone automatically and alerts property management so the leak can be fixed. During the 12-month trial period, AT&T Smart Irrigation saved the company 30.9 million gallons of water and more than $123,800.

We also work with HydroPoint – a provider of smart water management solutions – to remotely monitor & manage irrigation systems in real-time. Since 2017, AT&T has launched 141 smart water facilities with HydroPoint. And in 2020, we saved 60 million gallons of water through this program.

 

For more information, see our Climate Change issue brief, our Reducing Emissions website and our CDP Response (questions C2.4 and C2.4a).

 
Impact of Climate-related Risks and Opportunities on AT&T's Business, Strategy and Financial Planning

AT&T’s purpose is to create connection – supported by an expansive network woven into communities across the world. AT&T’s business is focused on working to make sure the social and economic benefits of broadband connectivity are available to everyone. Our network is tested by climate-related weather events and natural disasters every year, which is why it is important we ensure AT&T’s network is resilient in the face of climate-related risks.

As the world transitions to a net zero economy, AT&T is demonstrating leadership by setting aggressive goals and taking purposeful action through a combination of mitigation and adaptation efforts. Climate-related goals support our business strategy to pursue efficiency projects that save millions of dollars across our operations each year. By deploying IoT solutions to streamline key internal business processes, transitioning to a low-emissions fleet, scaling our renewable energy capacity, expanding sustainable production practices at WarnerMedia and working to virtualize large portions of our network, we’re able to deploy new capabilities faster while reducing energy use, cost and emissions.

We’re also taking steps to protect our network from threats and costly repairs associated with natural disasters and other extreme weather events. We proactively monitor potential nature-related threats to our network, employees and communities through the AT&T Weather Operations Center and through the use of climate-related scenario analysis.

We deploy high-capacity battery backup to our cell sites, which helps our network remain in service longer in the event of a power loss. We regularly test the batteries at every site and take steps to ensure fixed backup generators are fueled on a regular basis. Additionally, we’ve built redundancies into our supply chain and sourcing strategies, so we are not overly reliant on individual suppliers for commodities such as fuel.

AT&T is well positioned to benefit from the transition to a net-zero economy because a key part of our business is providing the technology and connectivity needed to scale climate solutions. Our connectivity solutions can drive emissions reductions in industries that currently have large environmental footprints, such as transportation, energy, manufacturing and agriculture.

For more information, see our Climate Change issue brief and our CDP Response (questions C2.3a, C2.4a, C3.1, C3.1b, C3.1d and C3.1e).

 

Resilience and Scenario Planning

AT&T assesses the potential impact and magnitude of climate-related risks on our operations, including our network infrastructure, our products and services, and our brand. In an effort to become more climate resilient, AT&T tracks the financial impact of climate-related weather events and has begun to use climate-related scenario analysis to understand the near- and long-term impacts to our business.

To help boost our resilience and better adapt to climate change, AT&T engaged the U.S. Department of Energy’s Argonne National Laboratory (ANL) for help assessing the risks of climate change on our business. This is the first such project publicly announced in the telecommunications industry and brings together insights from ANL’s regional climate modeling data with the sophisticated mapping capabilities of AT&T data scientists. This collaboration led AT&T to develop a Climate Change Analysis Tool (CCAT) that is helping us anticipate potential impacts of climate change on our infrastructure and operations – up to 30 years into the future.

To develop high-resolution, regional climate model projections for North America, ANL dynamically downscaled existing global climate model simulations developed for the IPCC 5th Assessment Report (AR5). This global climate dataset is the Coupled Model Intercomparison Project 5 (CMIP5) repository. The CMIP5 data was regionally downscaled for a business-as-usual carbon emission scenario, known as Representative Concentration Pathway (RCP) 8.5, and a second case, known as RCP 4.5, closer to the Paris Agreement.

With this data, CCAT helps AT&T visualize climate change risk on our infrastructure to make smarter, climate-informed decisions. For example, CCAT can show the maximum projected coastal or inland flooding, within 200 meters. These insights help us better plan for optimal asset placement and allow us to implement adapted construction methods, in the event we must place equipment where future flooding is anticipated.

We continue to expand our use of CCAT, and upon completion the tool will cover the entire contiguous U.S. – facilitating projections for flooding, high-intensity winds, drought and wildfires.

For more information, see our CDP Response (questions C3.1 and C3.1d).

How We Identify, Assess and Manage Climate-related Risks

AT&T explores both mitigation and adaptation strategies when considering climate change risks. To help identify and assess climate-related risk to our operations, we use the AT&T Climate Change Analysis Tool (CCAT) on an ongoing basis. For example, AT&T uses CCAT to cross-reference the location of network assets and operational facilities with projected inland and coastal flooding, or overall sea level rise, decades into the future – analyzing short, medium and long-term timeframes to inform our decision-making. As risks are identified via our CCAT tool, we use such information to help plan for maintenance, disaster recovery and future construction to best serve our customers and communities.

AT&T also uses such modeling to guide our capital investment spending, including deciding whether to elevate cell towers and other infrastructure in anticipation of sea level rise, or to protect such assets with barriers. For example, we have thousands of cell towers, some of which with batteries at ground level that are susceptible to flooding. CCAT is one tool we use to help determine which towers require retrofit to elevate the batteries above an identified risk zone.

Our CSR Global Environmental Sustainability team works with network and facilities experts across our operating companies to monitor and address climate-related impacts and required actions, as well as policy changes and other developments within and outside the company. As needed, such issues and identified solutions are communicated to our CSO, other relevant organizational leaders across our business, and to the AT&T Board of Directors.

For more information, see our Climate Change issue brief and our CDP Response (questions C2.1, C2,2 and C2.2a).

 

Integrated Risk Management

Climate change-related risks are integrated and analyzed through AT&T’s company-wide internal risk management processes. Our CSO oversees AT&T’s climate-related risks, opportunities and strategy-setting process, and receives weekly updates on climate-related activities and developments throughout the business.

Our CSR Governance Council (Council) is led by our CSO and is comprised of more than a dozen officers representing each of our operating companies and departments with responsibility for business operations aligned to our most important ESG focus areas, such as climate change, emissions and use of energy and water resources. The Council meets 3–4 times per year and collaborates across a broad range of initiatives, competencies and perspectives.

In addition to the Council, we convene 5 core issue committees led by senior CSR management – including a committee focused on environmental issues, led by our Assistant Vice President (AVP) – Global Environmental Sustainability, a direct report to our CSO.

Members of our Global Environmental Sustainability team monitor internal and external climate-related developments and work closely with business unit experts throughout our operating companies to implement and enhance programs and policies addressing climate-related risks and opportunities for AT&T.

Further, our CSO brings issues of climate-related risks to the attention of senior management across our business and, where relevant, the AT&T Board of Directors.

For more information, see our Climate Change issue brief and our CDP Response (questions C2.1 and C2.2).

Metric Assessment of Climate-related Risks and Opportunities

AT&T actively tracks our Scope 1, 2 and 3 GHG emissions and reports these metrics annually, including a rolling 5-year view to highlight trends in performance. Scope 1 emissions include direct emissions from sources owned or controlled by the company (such as our fleet). AT&T reports all emissions data containing Scope 2 (indirect) emissions using the market-based Scope 2 calculation method, in accordance with the GHG Protocol Scope 2 Guidance, unless otherwise specified. Scope 3 emissions are calculated, in part, using supplier responses to the annual CDP Supply Chain survey and the industry-accepted economic allocation model.

For more information, see our Greenhouse Gas Emissions and Energy Management issue briefs and our CDP Response (questions C4.2, C4.2b and C9.1).

 

Greenhouse Gas Emissions: Scope 1, 2 and 3

Most of AT&T’s in-scope emissions are associated with our Scope 2 emissions from purchased electricity. And most of our purchased electricity goes toward powering our network. We have seen a consistent decrease in our overall GHG emissions since 2015, as we have taken steps to scale energy efficiency projects and adoption of renewable energy. In 2020, our combined Scope 1 and market-based Scope 2 emissions decreased 11.54% year over year.

att-global-carbon-footprint

Greenhouse Gas Emissions

2016

2017

2018

2019

2020

Global carbon footprint (Scopes 1, 2 & 3 in metric tons [MT] CO2 equivalent [CO2e])

12,295,999

11,639,219

12,035,873

10,419,308

8,614,713

U.S. carbon footprint (Scopes 1, 2 & 3 in MT CO2e)1

11,620,252

10,716,169

11,081,005

9,387,488

7,932,357

Greenhouse gas emissions intensity (Scopes 1 & 2 in MT
CO2e/$ billions of revenue)

54,327

49,956

45,383

36,012

33,700

Greenhouse gas emissions intensity (Scopes 1 & 2 in MT CO2e/subscriber)2

42.92

36.61

38.21

30.59

25.39

1 Does not include supplier emissions.

2 From 2016-2019, we defined our water intensity as the water consumption of our company (numerator) relative to data traffic on our network (denominator), including satellite traffic. After achieving our 2020 water and energy intensity goals in 2019, we transitioned to intensity metrics relative to our total number of subscribers (North America wireless, wireline voice and global broadband).

 

Scope 3 Emissions

Our most relevant sources of Scope 3 emissions include:

  • Waste Generated in Operations: To calculate our emissions related to waste generation, AT&T uses the U.S. Environmental Protection Agency’s (EPA) Waste Reduction Model to report emissions from several different waste management practices. We delineate our waste material by corrugated containers, office paper, dimensional lumber, yard trimmings, mixed paper, mixed metals, mixed plastics, mixed recyclables, food waste, mixed organics and mixed municipal solid waste. In 2020, our waste-related emissions were 65,646 metric tons (MT) CO2e.
  • Business Travel: Our business-related travel includes air and rail travel, as well as rental car use. It does not include rideshare and taxi use. In 2020, our Scope 3 business-related travel emissions decreased 76% year over year, almost exclusively due to the global pandemic and associated restrictions on business-related travel.
  • Downstream Leased Assets: We track emissions from the operation of assets owned by AT&T and leased to other entities (e.g., our customers) that are not already included in Scope 1 or Scope 2 for the reporting year. Total emissions for leased assets in 2020 were 2.7 million MT CO2e, a 26.5% decrease from 2019.
  • Supplier Emissions: AT&T works with the CDP Supply Chain program to collect emissions data from our top suppliers. This data enables us to estimate 3 categories of Scope 3 supplier emissions: purchased goods and services, capital goods, and upstream transportation and distribution. In calculating these emissions estimates, we apply the economic allocation model. Each year, CDP receives data from the previous year’s emissions, so data received in 2020 reflects 2019 supplier emissions. Given the 1-year lag in supplier emissions availability, they are not included in our overall 2020 Scope 3 emissions total but are listed in the 2019 table below.

Scope 3 2019 Supplier Emissions 3

MT CO2e

Purchased Goods and Services

1,195,167

Capital Goods

272,850

Upstream Transportation and Distribution

126,883


3
Estimated for 3 categories only based on economic allocation of 2019 supplier GHG emissions, revenue and spend data for AT&T Communications, not including content and entertainment companies or suppliers’ own upstream Scope 3 emissions. The emissions are calculated from supplier responses to CDP Supply Chain using the industry-accepted economic allocation model.

For more information, see our our Greenhouse Gas Emissions issue brief and our CDP Response (questions C6.1, C6.3 and C6.5).

 

Goals to Support the Transition to a Net-zero Economy

Climate-related goals support our business strategy to pursue efficiency projects that save millions of dollars across our operations each year. By deploying IoT solutions to streamline key business processes, transitioning to a low-emissions fleet, scaling our renewable energy capacity, expanding sustainable production practices at WarnerMedia and working to virtualize large portions of our network, we’re able to deploy new capabilities faster while reducing energy use and emissions.

Carbon Neutral Commitment  

AT&T has committed to becoming carbon neutral, achieving net zero Scope 1 and 2 GHG emissions by 2035.

We will achieve this by focusing on 6 key initiatives:

  • Accelerating energy efficiency and network optimization efforts: Each year, AT&T implements thousands of energy efficiency projects across its network and operations, bringing down electricity use and reducing costs. In 2020, we invested more than $100 million to implement approximately 8,800 energy efficiency projects resulting in gross annualized cost savings of nearly $40 million. Since 2010, we have implemented nearly 147,000 energy efficiency projects, resulting in annualized energy savings of nearly 7.6 billion kWh and gross annualized cost savings of $694 million.
  • Supporting the renewable energy marketplace: By entering into power purchase agreements with renewable energy developers, AT&T reduces our emissions footprint, helping protect against rising energy costs and add more clean electricity to the U.S. power grid. Over the past few years, AT&T has transitioned from a few megawatts of renewable energy to purchases totaling 1.5 gigawatts domestically, making AT&T one of the largest corporate purchasers of renewable energy in the United States. As part of our purchase commitments, in 2020 we announced an agreement representing more than 500 megawatts of solar energy – the largest U.S. corporate solar energy deal to date.

    In Argentina, we’ve reached a 1,200 MWh/year agreement to contribute renewable energy to the grid supporting our DIRECTV central office through 2025. And in Mexico, we’re implementing a 40 GWh/year agreement to supply renewable energy to approximately 1,200 network sites.

    AT&T is committed to expanding our efforts in this area and will continue to look for opportunities to grow our renewable energy portfolio. We not only use our internal expertise but also are members of industry-leading renewable energy organizations such as the Renewable Energy Buyers Alliance.
  • Transitioning to a low-emissions fleet: AT&T will continue to reduce emissions from our operational fleet by implementing efficiency technology, optimizing routes, minimizing truck rolls and reducing vehicle count in targeted portions of the fleet. We’re also planning for low- and zero-emissions vehicles such as electric vehicles as they become available for various segments of our fleet. Through the end of 2020 we have reduced U.S. ground fleet emissions by 332,658 metric tons of CO2e, or 38.4% from our 2008 baseline. In addition to reducing the size of our domestic fleet by more than 8,000 vehicles, 81% of passenger sedans procured for our domestic fleet since 2019 have been hybrids.
  • Virtualizing many network functions: AT&T is in the process of eliminating significant portions of energy-intense network equipment and relying instead on low-cost, energy-efficient hardware that can virtualize the functions of the network equipment. As a result, we will be able to deploy new capabilities faster, utilize less energy and lower our greenhouse gas emissions footprint.
  • Expanding sustainable feature film and TV production: WarnerMedia reduces the energy and resource consumption associated with film and television production through cleantech solutions, sustainable products and reuse and waste reduction efforts.
  • Investing in carbon offsets: Though AT&T aims to reduce its footprint to as close to zero emissions as possible, there may be some sources of emissions that cannot be eliminated. In these cases, we may invest in carbon offsets in the future.

 

Science-based Targets  

To guide efforts toward our net zero emissions goal, we set science-based targets that align with international consensus on limiting global temperature increases. Approved by the Science Based Targets initiative – a joint effort of CDP, WWF, the U.N. Global Compact and the World Resources Institute – we seek to:

Goal

Progress

Purchased Goods and Services

1,195,167

Reduce our absolute Scope 1 and 2 GHG emissions4 63% by 2030 (2015 baseline) – aligning with a 1.5°C pathway.

Since 2015, we have reduced Scope 1 and 2 emissions by 37% and are currently ahead of our timeline to achieve our 2030 target.

Work to ensure 50% of our suppliers (covering purchased goods and services, capital goods and downstream leased assets as a portion of spend) set their own science-based Scope 1 and Scope 2 targets by 2024.

Through the end of 2020, 40% of our suppliers had set such targets.

 

10x Goal  

In 2015, we established a “10x” goal to enable customer carbon savings 10 times the footprint of our operations by 2025. This goal was intentionally set as a ratio, to incentivize reduction of AT&T’s operational emissions while quantifying increases in the emissions savings AT&T connectivity enables.

Through numerous internal initiatives, AT&T’s 2020 operational footprint decreased to approximately 5.8 million metric tons of CO2e. And we calculate that through the end of 2020 AT&T has enabled annualized customer GHG emissions savings of at least 31.3 million metric tons of CO2e – achieving nearly 55% of our 10x goal, with 5 years to go.

 

Gigaton Goal and AT&T Connected Climate Initiative

Following the launch of AT&T’s commitment to achieve net zero Scope 1 and 2 emissions by 2035, we sought a more ambitious goal for enablement of customer GHG emissions reductions.

In 2021, we retired our 10x goal and announced an industry-leading target to deliver connectivity solutions that enable business customers to save a gigaton (1 billion metric tons) of GHG emissions by 2035.

One gigaton is equal to approximately equal to:

  • 15% of U.S. greenhouse gas emissions5 or nearly 3% of global energy-related emissions in 20206
  • 1.6 billion flights from Los Angeles to New York7
  • The emissions reduction capability of 215,000 wind turbines running for a year

Our gigaton goal will calculate the cumulative impact of customer emissions savings from 2018, when we first calculated AT&T customer emissions reduction enablement, through 2035.

Progress against our gigaton goal will be reported annually. Our calculations indicate that from 2018–2020, AT&T technology solutions cumulatively enabled customer emissions reductions of more than 72 million metric tons of CO2e – equivalent to more than 8.1 billion gallons of gasoline, per the U.S. EPA.

Meeting global climate goals requires immense collaboration. AT&T is applying its global reach, resources and scale to form a new Connected Climate Initiative (CCI) with leading technology companies, AT&T business customers, universities and environmental nonprofits. Through the CCI, we will work with businesses including Microsoft, Equinix and Duke Energy, along with research universities and a range of other organizations, to deliver broadband-enabled climate solutions at global scale.

For more information, see our Greenhouse Gas Emissions and Energy Management issue briefs, our Reducing Emissions website and our CDP Response (questions C4.1, C4.1a, C4.1b, C4.2 and C4.2b).

 

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4 Scope 1 emissions include direct emissions from sources owned or controlled by the company (such as the fleet). Scope 2 emissions include indirect emissions that result from the generation of purchased energy.

5 U.S. Environmental Protection Agency https://www.epa.gov/ghgemissions/inventory-us-greenhouse-gas-emissions-and-sinks

6 International Energy Agency https://www.iea.org/articles/global-energy-review-co2-emissions-in-2020

7 Based on conversion factors from UK Government Department for Business, Energy & Industrial Strategy (BEIS)

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