November 17, 2006
Press Release: Sierra Club files for KCP&L shareholder resolution
The Sierra Club filed a shareholder resolution late Thursday (November 16, 2006) calling on Great Plains Energy, the parent company of Kansas City Power & Light, to analyze and report to the shareholders on the financial impact a tax on carbon dioxide emissions will have on the company.
The coal-burning power plants operated by Kansas City Power & Light emit millions of tons of carbon dioxide (CO2) annually. This is of great concern because carbon dioxide is a major contributor to global warming.
The resolution filed by the Sierra Club points out that the CEO of Duke Energy Corporation, Paul Anderson, has called for a mandatory national carbon tax in order to ensure that financial impacts are distributed appropriately as the nation takes steps to reduce the carbon intensity of our economy, and that the Public Utilities Commission of the State of California has issued a ruling requiring large electric utilities to explicitly account for the financial risk associated with greenhouse gas emissions by incorporating costs of between $8 and $25 per ton of CO2 emissions in their long range planning for electric generation capacity.
“Public concern about global warming has become increasingly heightened in the past year, especially with the severity of hurricanes Katrina and Rita,” said Melissa Hope Blakley, with Missouri Sierra Club. “With KCPL emitting over 20 million tons of CO2 per year, a tax on these emissions could have a major impact on the firm, and on the cost of electricity in the Kansas City area. The company management has not informed shareholders of this risk, and we think the investors deserve to know about it. In addition, we think the ratepayers deserve to know that they will no doubt be expected to share the cost of any carbon tax.”
Shareholders should have an opportunity to vote on the Sierra Club resolution in April, 2007.
SIERRA CLUB SHAREHOLDER RESOLUTION
Filed 11-16-06 by David Ortman, [firstname.lastname@example.org], (206- 233-1908)
Whereas, Great Plains Energy, by operating coal burning power plants, is emitting millions of tons of CO2 annually, which is a greenhouse gas, and
Whereas scientific evidence of global warming has become increasingly accepted, (as documented by Naomi Oreskes in the journal Science, December, 2004) and,
Whereas public understanding of global warming has become increasingly heightened in recent years, and
Whereas public concern pertaining to global warming has been greatly increased by the severity of hurricanes Katrina and Rita. and
Whereas the CEO of Duke Energy Corporation, Paul Anderson, has publicly called for a mandatory national carbon tax in order to ensure that financial impacts are distributed appropriately as the nation take steps to reduce the carbon intensity of our economy, in his keynote speech to about 700 civic and business leaders at the Charlotte Business Journal's annual Power Breakfast April 7, 2005, and
Whereas the Public Utilities Commission of the State of California has issued a ruling requiring large electric utilities to explicitly account for the financial risk associated with greenhouse gas emissions by incorporating costs of between $8 and $25 per ton of CO2 emissions in their long range planning for electric generation capacity decisions to ensure that California will be fully apprised of the potential costs associated with carbon emissions, and
Whereas extensive legislation has been introduced at the state and federal level aimed at reducing emissions of CO2 from US corporations.
THEREFORE, THE SHAREHOLDERS RESOLVE that Great Plains shall prepare a financial analysis, at reasonable cost and omitting proprietary information, of the impact of a $20 tax per ton of CO2 emitted on projected Great Plains financial results for a period of 10 years after such a tax is effective.
This report shall be made available to shareholders by July 15, 2007, and shall be included in the next Annual Report thereafter.
Discussion: We believe that incorporating a carbon tax estimate in the long range electric generation capacity planning of the company is in the financial interest of Great Plains Energy's shareholders, who will be well served by a rigorous analysis of the company's current and future financial exposure to the expected enactment of a carbon tax. Great Plains Energy must begin planning to mitigate the financial impacts of a carbon tax on the company. Such contingency planning is critical for Great Plains Energy's financial future, and full coverage of the carbon tax exposure should be required in the company's annual reports to the shareholders. We urge you to vote FOR this resolution.
Bruce Nilles, Sierra Club, 608.712.9725
Melissa Hope Blakley, Missouri Sierra Club, 816.806.6965