US carbon reporting investigation secures another victory

The global fight to force carbon intensive firms to provide information to investors the climate change-related risks they face secured another victory last week, after US energy giant Dynegy announced it would provide information on its carbon footprint and associated risks in its annual reports.

The deal was brokered by former US vice president Al Gore and New York Attorney General Andrew Cuomo, who has been undertaking an investigation into energy firms' reporting of climate change related risks after a coalition of institutional investors last year filed a petition with his office requesting clarification on whether energy firms should disclose material risks arising from climate change.

Under the terms of the deal, Houston-based Dynegy last week filed its 2007 10-K filing with the US Securities and Exchange Commission (SEC), featuring information on the company's carbon dioxide emissions by region and citing risks to its business arising from recent US Supreme Court rulings that make carbon regulations increasingly likely.

The company – which is one of the largest consumers of coal in the US operating power plants in 13 states – said it would also provide investors with a study on how its business could be affected by future climate change legislation, litigation and the physical effects of global warming, as well as information on how it plans to mitigate those risks and manage emissions.

The move marks the second major victory for Cuomo's investigation, after a similar deal was reached with Xcel Energy earlier this year.

Speaking at a press conference to announce the agreement, he confirmed that his office would continue to push energy firms to publicly report their carbon emissions and hinted strongly that legal action could be taken to force them to do so.

"You have to disclose the facts to the public," he said. "It's not just good public policy, it's the law."

Carbon intensive firms are facing growing pressure from both legislators and investors to report on their carbon emissions, with lobby groups such as Ceres and the Carbon Disclosure Project encouraging more and more firms to publish carbon footprint data as a matter of best practice.