NEW YORK (Legal Newsline) - An energy company will have to notify investors of the financial risks posed by climate changes, according to an agreement steered by New York Attorney General Andrew Cuomo.
Cuomo called the agreement with Xcel Energy landmark and precedent-setting. Xcel is investing in coal-burning power plants that Cuomo says will contribute to global warming emissions.
"This landmark agreement sets a new industry-wide precedent that will force companies to disclose the true financial risks that climate change poses to their investors," Cuomo said.
"Coal-fired power plants can significantly contribute to global warming and investors have the right to know all the associated risks. I commend Xcel Energy for working with my office to establish a standard that will improve our environment and our marketplace over the long term."
In its annual Form 10-K filings, required by the Securities and Exchange Commission, the company will disclose an analysis of the risks related to climate change regulation and legislation, climate change-related litigation and physical impacts of climate change.
Xcel will also disclose current carbon emissions, projected increases in carbon emissions from coal-fired power plants, strategies for reducing global warming emissions and corporate governance actions related to climate change.
Cuomo subpoenaed the company in September, demanding information filed with the SEC about climate change impact. One coal company, Peabody Energy, called Cuomo's investigation grandstanding.
"The New York state attorney general's office is using purported legal and regulatory claims to promote a political message by announcing an investigation of climate risk disclosure among major U.S. energy companies," the company said.
"It is unwarranted to use the legal process to advance the 'just say no' agenda, which opposes practical energy answers and has driven America to an unnecessary energy crisis.
"The legal system is designed to protect -- not harass -- those such as Peabody which are providing clean energy solutions for America.
"A process intended to protect shareholders is instead being used to advance a political agenda. It is already accomplishing the first objective: to gain headlines for a cause that has nothing to do with investor communications."
From Legal Newsline: Reach John O'Brien by e-mail at firstname.lastname@example.org.