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Companies disclose financial risks of climate change


Environmentalists generally regard owners of coal-fired power plants as the Enemy No. 1. Though the plants produce the majority of America’s energy, they’re also sickeningly dirty (both literally and figuratively): Coal-fired power plants are responsible for more than 40 percent of the US’s yearly carbon emissions, not to mention all the other gunk like sulfur dioxide, nitrogen oxides, and particulates that they spew into the air.

And while there’s no way a greenie will ever love—or even tolerate—a coal-fired power plant, we can applaud one company for making a step in the right direction. Last week Dynergy, one of the major owners of US coal-fired power plants, made an announcement that it will warn investors about how global warming could affect its business. The company joins one other, Xcel Energy, which made a similar agreement this August.

From a New York Times story:

Dynergy has agreed to put detailed information in its financial filings on any material business risks posed by climate change.

 

That could include warning investors about looming government regulations that might make it more expensive to emit carbons, or the possibility that the company could be sued over pollution.

The agreement came at the request of New York State attorney general Andrew Cuomo. Cuomo’s also pressuring three other power companies—the AES Corporation, Dominion Resources, and the Peabody Energy Corporation—to warn investors of financial risks associated with global warming.

Despite the hubbub the agreement caused in the business and environmental sectors the past few days, Dynergy says that it doesn’t expect its practices to change as a result of the commitment.

From the New York Times:

A spokesman for Dynergy, which is based in Houston and provides wholesale power in 13 states, said the company believed that it was already making the types of disclosures sought by Mr. Cuomo’s office, and did not expect to have to change its practices.

Whether Dynergy believes the agreement is significant or not, environmentalists and Al Gore have applauded the effort, and hope that it will set a precedent for other businesses.

We at Plenty are sure hoping that it does. With the economy in dire straits, many investors are shy to put their money into small, green start-ups and clean tech companies. Here’s hoping that with major businesses starting to disclose the financial risks associated with burning fossil fuels, investors will start throwing some major dough at clean, alternative energies.