New York, USA - Nearly two months after forcing one of the country’s largest utilities to disclose climate change risks to investors, New York’s attorney general reached an agreement Thursday with Dynegy requiring that it offer investors a glimpse into potential liabilities posed by global warming.

The move follows subpoenas issued to five major utilities in 2007 under the state’s 1921 Martin Act, which gives his office access to corporate financial records. Attorney General Andrew Cuomo, who made the announcement alongside former Vice President Al Gore, inquired into whether disclosures filed through the U.S. Securities and Exchange Commission thoroughly analyzed the business risks posed by the greenhouse gases their companies emit in light of impending climate change legislation.

"Today we raise the bar in the industry and ensure transparency and disclosure in the marketplace," Attorney General Cuomo said in a statement. "Investors have the right to know all the material financial risks faced by coal-fired power plants associated with global warming and I hope and expect that other companies will follow the lead of Dynegy and Xcel."

Dynegy, based in Houston, is one of the country’s top coal consumers. It generates more than 18,000 megawatts annually, and owns interests in several planned coal and natural gas power plants. It has previously offered disclosures to its shareholders, the company said.

"We will continue to provide appropriate information to investors about climate change risk," David Byford, company spokesman, told Reuters.

Under the agreement, Dynegy must analyze the financial risks or current and future climate change regulations, litigation and physical impacts. It must also tell investors its current emissions inventory, projected emissions from planned coal-fired power plants, and strategies for reducing and offsetting emissions. It also must disclose climate change-related corporate governance actions and whether environmental pay is tied to corporate compensation.

Disclosures will be included in the company’s annual 10-K filings. Xcel settled a similar agreement in late August, while investigations of AES Corp., Dominion Resources and Peabody Energy are ongoing.

source: ClimateBiz