CUOMO: AES must disclose financial risks

Local News

November 20, 2009

Staff Reports The Niagara Gazette Fri Nov 20, 2009, 11:13 PM EST

State Attorney General Andrew Cuomo announced an agreement Thursday that would require AES Corp. to disclose timely and relevant information to investors about financial risks associated with the production of global warming pollution.

The company has a plant, AES Somerset, in Barker.

The agreement with AES follows settlements Cuomo reached last year with two other major energy companies, Dynegy Inc. and Xcel Energy. A statement from Cuomo’s office said AES cooperated fully with the agreement.

“As efforts to curb climate change continue, it is important that the investing public know the financial risks of companies that produce large quantities of global warming pollution,” Cuomo said. “My office’s initiative to make sure companies are up-front with investors continues, and I applaud AES for joining other energy companies in setting an industry standard to benefit both the environment and the marketplace.”

Under the agreement, AES must disclose material risks associated with climate change in its annual summary report on the company’s performance to the Securities and Exchange Commission. This includes an analysis of risks related to present and probable regulation and legislation, litigation or physical impacts of climate change.

Through the agreement, AES has committed to a broad array of additional climate change disclosures, including current and projected carbon emissions. The company will also disclose what strategies it is developing to reduce, offset, limit or manage its pollution and any corporate action relating to climate change.

Cuomo’s office said new regulatory efforts to reduce global warming pollution can impact a company’s financial outlook through the costs incurred to comply with the regulations. Potential investors must be aware of such material risks in order to make an informed investment decision, Cuomo said.

In the U.S., AES operates 17 power facilities, the majority of which are fueled by coal, with a total generation capacity of almost 12,000 megawatts. The company’s U.S. plants emitted a reported 42 million tons of carbon dioxide in 2006, placing AES among the top 20 of the largest emitters of global warming pollution by energy companies in the country.