New York Subpoenas Five Energy Companies for Climate Risks
ALBANY, New York, September 17, 2007 (ENS) - New York Attorney General Andrew Cuomo Friday sent subpoenas to five of the nation's largest energy companies, demanding that they disclose the financial risks of their greenhouse gas emissions to shareholders, specifically to the New York State Common Retirement Fund.
Attorney General Cuomo sent letters to the top executives of AES Corporation, Dominion Resources, Xcel Energy, Dynegy, and Peabody Energy seeking information about the companies' analyses of these risks and the disclosure of such risks to their shareholders as required by law.
In the case of Houston-based Dynegy, Cuomo wrote to Chairman and CEO Bruce Williamson, 'We are aware that Dynegy, Inc. has announced plans to build eight new conventional coal-fired power plants across the United States. The resulting massive increase in CO2 emissions from the operation of eight new conventional coal-fired power plants will subject Dynegy to increased financial, regulatory and litigation risks. We are concerned that Dynegy has not adequately disclosed these risks to its shareholders, including the New York State Common Retirement Fund, which is a signficant holder of Dynegy stock.'
'As a result of the operation of its eight new conventional coal-fired power plants,' Cuomo wrote, 'Dynegy will become one of the top five emitters of CO2 in the country.' He says Dynegy's emissions would increase by 200 percent, and over the 60 year life of these power plants, 'might well emit 3.7 billion tons of CO2 total.'
In the case of Peabody Energy, the world's largest private-sector coal company, Cuomo is seeking disclosure of the risks associated with building power plants that will generate a total of 3,100 megawatts of power, and may subject the company to increased financial, regulatory and litigation risks.
In the case of Dominion Resources, Cuomo requested information about the risks associated with the company's plans to build a 585 megawatt coal-fired power plant 'without current plans to capture and sequester the resulting carbon dioxide emissions.'
In the case of Xcel, Cuomo requested information about the risks of a planned 750 megawatt coal-fired power plant with no carbon capture and sequestration plans in place.
And in the case of AES, Cuomo simply said the company is 'one of the nation's largest producers of greenhouse gas pollutants, including carbon dioxide.' He pointed out that the company's 2006 Form 10-K, required by the Securities and Exchange Commission did not disclose projected emissions, nor evaluate the impact of upcoming greenhouse gas regulations on the company's financial picture.
In all the letters, the attorney general wrote, 'Climate change is one of the most pressing environmental challenges facing the world today.' He reminded the executives that emissions from U.S. power plants 'constitute 30% of total U.S. carbon emissions' and that regulation of greenhouse gas emissions on the state level through the Regional Greenhouse Gas Initiative, to which New York is a Party, will begin shortly.
'Any one of the several new or likely regulatory initiatives for CO2 emissions from power plants - including state carbon controls, E.P.A.'s regulations under the Clean Air Act, or the enactment of federal global warming legislation - would add a significant cost to carbon-intensive coal generation,” the letters said.
They stated, 'Selective disclosure of favorable information or omission of unfavorable information concerning climate change is misleading.”
Peabody Energy shot back that the letter's claims of nondisclosure were inaccurate and were written to 'advance a political agenda.'
'Peabody is happy to point out our clear disclosures regarding climate change and correct the letter's inaccuracies. For instance, the letter states that we don't have climate disclosure ... but in fact we do, in multiple places in our SEC filings on Form 10-K, annual report and social responsibility report. These are all available via Internet for anyone wanting to research the company.'
'In addition to advancing clean new coal generation, Peabody is a founding member of the zero-emissions FutureGen project to commercialize carbon capture and storage,' the company said.
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