Governance & Risk Management

Governance

Strong governance and robust risk management are rooted in everything we do across Emera. We believe these practices drive stability, enable growth and guide informed decision making that’s in the best interest of customers, communities, shareholders and our team.

 

Sustainability Governance

Our commitment to robust governance extends to our approach to sustainability. Our corporate sustainability team and executive leadership monitor our progress and determine the strategic direction of our sustainability programming. The Board of Directors and its committees oversee all material risks and opportunities across Emera, including those directly related to sustainability. Below is an outline of our approach to the oversight and management of sustainability at the Board, Management and operating company level. 

 

 

Risk Management

Our Emera-wide Enterprise Risk Management (ERM) Program guides how we identify and assess material risk in all areas of our business. 

We maintain a risk inventory that’s regularly reviewed by our Enterprise Risk Management Committee (ERMC), with focus on material changes in risk environments and mitigation strategies. Our ERM Program is overseen by the Board of Directors and its Risk and Sustainability Committee (RSC). Each operating company maintains its own risk register that’s reviewed each year by the ERMC. 

To ensure our sustainability priorities are fully integrated into our ERM Program, we regularly assess our sustainability risks against enterprise risks to identify gaps and develop mitigation strategies and action plans. This is supported by our sustainability governance structure, which is designed to drive alignment at all levels of the organization. 


Additional Information

Asset Management (Integrity and Performance)
As we focus on safely delivering cleaner, reliable energy, we’re always working to minimize the cost impacts for our customers. The way we operate, maintain and monitor our assets is critical to this.    

Effective asset management programs ensure our operations run safely, efficiently, and in full compliance with all applicable legal and regulatory requirements. Oversight of our corporate asset management approach is shared by Emera’s Board of Directors and the leadership team. Working closely with leaders across our operating companies, Emera’s VP of Asset Integrity leads the coordination of our business-wide approach. 

Aspects of asset management are included in our corporate and operating company Environmental Management Systems and Safety Management Systems. Guided by these, asset management programs in our operating companies are fully integrated and aligned with the ISO 55000 international standard. Operating company leaders oversee their respective programs, including the development of processes and expectations, as well as the assignment of roles and responsibilities within their dedicated asset management teams. These teams work with other functions and departments to determine the risk profile of specific assets and to design and implement asset lifecycle management plans.  

We strive to deliver Strategic Asset Management (SAM) in our operating companies that encompasses aspects of both asset integrity and performance including work management, reliability programs, operational technology, performance management and asset planning.  ​ 

Each year, many of our operating companies disclose specific asset management targets and objectives. In some cases, this includes progress updates on regulated performance standards such as the availability of generating assets or vegetation management programs. At the corporate level, certain aspects of asset performance such as System Average Interruption Duration Index (SAIDI) and System Average Interruption Frequency Index (SAIFI) rates are disclosed annually in our Sustainability Report.  

To understand and assess the risks of climate change to our assets, we’re implementing an Emera Climate Risk Adaptation Framework. Based on a program developed by Electricity Canada, our framework integrates climate risks into our existing risk management approach.  

Our employees complete a wide range of asset management training in various focus areas including root cause analysis, risk assessment and asset optimization. We provide internal training, as well as programs offered by internationally recognized bodies such as the Institute of Asset Management.  

Asset management performance is tracked through regular internal reviews and external audits. These include weekly reports to asset management directors, annual reviews that report to senior leaders, annual assessments carried out by our insurance loss control teams and external audits including North American Electric Reliability Corporation (NERC) assessments, which take place every three years.  

We have established and documented processes to address preventative and corrective actions identified through operational surveillance, reports and audits, including robust root-cause analyses. We strive for continual improvement through our strategic asset management planning and performance tracking process.    
Cybersecurity Program
We increasingly rely on information technology and network infrastructure to manage our business, to safely operate our generation, transmission and distribution assets, and to deliver the decentralized energy systems and digital solutions our customers expect. 

Across Emera, we’re focused on managing and mitigating cybersecurity risk to protect our systems, grid security, and customer data. 

Our Emera-wide Cybersecurity Framework and Digital Strategy helps us address cybersecurity risk through internal and external security testing, data protection, program maturity objectives, cybersecurity incident response readiness, and employee communication and training. We also work to mitigate other information technology risks through asset lifecycle planning and management, third-party auditing, and system and penetration testing.  

Our Framework is aligned with industry standard National Institute of Standards and Technology (NIST) Cyber Security Framework and is in compliance with our regulatory responsibilities as set out by the North American Electric Reliability Corporation, the Northeast Power Coordinating Council and the U.S. Department of Homeland Security. We also collaborate regularly with various governmental departments, industry associations, peers and vendor partners to share alerts and experiences and learn about emerging cybersecurity risks. 

A significant component of our Framework is our Cyber Incident Readiness and Response Protocol that prepares us for potential cybersecurity incidents. Our robust Emera-wide cyber risk training program is driving quarterly training and monthly testing for our employees.  

Our approach to managing cybersecurity risk is led by our Chief Digital Officer, with direct oversight from the Risk and Sustainability Committee (RSC) of the Board that reviews the status of key elements of our cybersecurity program on a quarterly basis. The Board of Directors also oversees our cybersecurity risk and mitigation plans through its review of our enterprise risk dashboard and heat map at each regularly scheduled Board meeting. In the event of a cybersecurity incident, our Cyber Incident Readiness and Response Protocol is triggered, and the Board is immediately informed. There were no reportable cybersecurity breaches in 2022. 
Emergency Response Program

Corporate Emergency Response 

Our Emera-wide Enterprise Risk Management (ERM) Program provides discipline and consistency in how we identify and assess material risk, including emergency events, in all areas of our business and considers impacts that include categories of safety and environment. Our approach includes identification of mitigations for emergency and crisis response events.

Oversight of risk management is the responsibility of the Emera Board of Directors with two board committees (Health, Safety & Environment and Risk & Sustainability) advising on areas of emergency response and crisis management with the assistance of Emera’s leadership team. 

Each of our operating companies manage emergency response through formal emergency response plans required by our Safety Management System (SMS) and/or our Environmental Management System (EMS). Our operating companies develop plans based on local operations, respective regulatory requirements and with consideration for the customers and communities they serve. Through our corporate ERM, SMS, and EMS each operating company reports regularly on their emergency response approach, progress, and performance.  

Corporate Crisis Management Team 

We have an Emera enterprise level Crisis Management Team (CMT) that provides emergency response governance and advisory support at the corporate level, and coordination for events that impact more than one of our operating companies. For enterprise type events such as pandemics and cyberattacks, we have corporate-wide plans that are aligned with operating company plans and procedures to respond and to mitigate the risks. 

 

Operating Company Emergency Response  

Local Response and Planning 

Emergencies within our operating companies can include a wide range of events such as cyberattacks, dam safety incidents (where applicable), fires (including wildfires), oil or hazardous substance releases, natural gas leaks, severe storms (such as hurricanes) and threats of physical harm to operating sites.  

Emergency response is managed at the local level by our operating companies. This is paramount to ensuring our emergency responses meet the specific needs of the communities where we operate by allowing incident response decisions to be addressed by local emergency response teams who can mobilize resources quickly and effectively.   

Each of our operating companies have specific emergency response plans that outline dedicated roles and responsibilities for operational staff, management, as well as senior leader and board oversight. Our plans also include formal procedures for communicating and coordinating with communities and local authorities during emergency events. When an emergency happens, regional and site emergency response teams are mobilized, and decisions are made based on defined Incident Command System structures by trained professionals with direct connections to local authorities and other stakeholders. 

Our operating companies hold regular tabletop exercises and/or drills to test their emergency response plans. These exercises and/or drills often include participation by local authorities. Debrief analyses and associated lessons learned from these exercises, and from actual emergency events, provide organizational learning and help to identify opportunities for process improvement.  

Electric Utility Emergency Response Plans and Mutual Assistance Agreements  

Our electric utilities adhere to North American Electric Reliability Corporation (NERC) standards that guide utilities in preparing for, and responding to, emergencies. Our two largest electric utilities are required to file emergency response plans with their regulators. Tampa Electric has submitted a 10-Year Storm Protection Plan (SPP) with the Florida Public Service Commission, which includes details on company-wide response drills and storm preparation and restoration exercises. The company is also required to submit a SPP Annual Status Report. Nova Scotia Power is required to submit an annual Emergency Services Restoration Plan (ESRP) and Drill Report to the Nova Scotia Utility and Review Board, which includes details for staged drills and implementation of the ESRP in response to an actual major storm event. 

At our electric utilities, emergency response contact numbers are available for the public to report potential environmental and safety issues or other emergencies (Barbados Light & Power Company - Emergencies and Check Before You Excavate, Grand Bahama Power Company - Outages, Nova Scotia Power - Safe Clearance and Nova Scotia Department of Environment and Climate Change - 24 Hour Emergency Line, and Tampa Electric - Power Line Safety). In the event of an emergency, local authorities and responders work to ensure all affected members of the public are notified in a timely manner. The installation of advanced meter infrastructure (AMI) across our utilities, allows our utilities to identify customer outages at the premise level, providing greater insight into outage locations, helping us improve our restoration times following emergency outage events.  

Our electric utilities participate in mutual assistance agreements with our electric utility peers. These agreements allow line workers, arborists and field staff from other electric utilities to travel and assist each other with restoration efforts. This helps us restore electricity service as quickly as possible for our utility customers across our service territories following a severe storm or other damage to our electrical grids. Resource agreements are also in place with local contractors to aid in these extreme events. 

Gas Utility Pipeline Inspections and Damage Prevention Programs  

Emera’s Canadian and United States gas utilities have pipeline inspection programs in place that meet the requirements set out by the Canada Energy Regulator (CER) in Canada and the Pipeline and Hazardous Materials Safety Administration (PHMSA) in the United States. These proactive pipeline inspections help reduce emergency incidents by allowing us to identify pipeline integrity issues early and correct them proactively.  

We have damage prevention programs in place to help prevent uncontrolled natural gas releases. For example, our operating company Peoples Gas (PGS) maintains Damage Prevention Programs in accordance with state and federal guidelines. These programs help to prevent damage to our pipelines and facilities from excavation activities, such as digging, trenching, blasting, boring, tunneling, or backfilling. Outreach and communication with local contractors and the public is a key pillar of these programs.  

We leverage our well-established Call Before You Dig campaigns and hotlines, along with our proactive outreach programs, to help us raise awareness and share important information about safety digging practices and how we can all work together to reduce risk. Before starting a project, contractors and members of the public are asked to reach out to one of our Call Before You Dig hotlines (Emera New Brunswick – Call Before You Dig, New Mexico Gas – Call 811 Before You Dig, and Peoples Gas – Call Before You Dig and Pipeline Awareness) to request a free pipeline locate. We deploy utility staff to mark the location of underground gas lines before projects commence.

Emera New Brunswick, the owner of the Brunswick Pipeline, a 145-km natural gas transmission pipeline that extends from Saint John to St. Stephen, New Brunswick, is federally regulated. As such, it is also required to have an Emergency Management Program and Emergency Response Plan in place.   

Proactively Preparing for Climate-related Emergencies  

While our emergency response plans include procedures for responding to extreme weather events such as hurricanes, we recognize we must continue to strengthen and reinforce our generation facilities, energy delivery systems and other infrastructure, to better withstand the impacts of increasingly frequent and severe weather and the associated emergencies that may result. We must also regularly review and update our emergency response plans with these climate impacts in mind.  

Our Emera-wide Climate Adaptation Framework provides a consistent, proactive approach for assessing climate risks and potential impacts, as well as implementing management and adaptation strategies to reduce these impacts. Climate adaptation mitigations can include wildfire prevention and response protocols, additional storm hardening, refurbishment and upgrades of equipment and infrastructure and improved vegetation and erosion management. Additionally, as new assets are refurbished or replaced, we’ve evolved engineering designs and standards to address evolving climate risks. Examples of climate adaptation planning and action across our operating companies, including storm hardening and vegetation management, wildfire management, flood management, storm and sea level rise, ice and wind management, water management, and investing in technology, can be found in our 2023 Climate Transition Plan Update.  

Sustainability Management Committee Charter

The Sustainability Management Committee (SMC) provides oversight, advice and support to Emera and its operating companies regarding the management of sustainability risks and opportunities. The SMS monitors the identification and assessment of sustainability priorities, ensures they are being managed, and monitors the company’s overall sustainability performance. The roles, responsibilities and scope of the SMC are outline in the Sustainability Mangement Committee Charter. 

Risk and Sustainability Committee Charter

The Risk and Sustainability Committee (RSC) is a committee of the Emera Board of Directors. Its primary responsibility is to assist the Board in guiding Emera's approach to enterprise risk and sustainability by overseeing Emera’s risk management framework and the allocation of responsibility for risk management. The RSC is guided by the Risk and Sustainability Committee Charter.