Dynegy GHG Reduction Goals 2011
|Filer||New York City Office of the Comptroller|
|Subject(s)||Climate Change; Greenhouse Gas Emissions|
|Resolved Clause Summary||Greenhouse gas emissions reduction goals|
|Supporting Memo||Download PDF|
In October 2006, a report authored by former chief economist of the World Bank, Sir Nicolas Stern, estimated that climate change will cost between 5% and 20% of global domestic product if greenhouse gas (GHG) emissions are not reduced, and that GHG's can be reduced at a cost of approximately 1% of global GDP per year.
In October 2009, a National Academy of Sciences report stated that the burning of coal to generate electricity in the U.S. causes about $62 billion a year in "hidden costs" for environmental damage, not including the costs for damage associated with GHG emissions. According to the U.S. EPA, monetized costs and benefits of complying with the Clean Air Act and its amendments total over $700 million and $23 trillion, respectively.
The electric generating industry accounts for more carbon dioxide emissions than any other sector, including the transportation and industrial sectors. U. S. fossil fueled power plants account for nearly 40% of domestic and 10% of global carbon dioxide emissions.
On May 13, 2010, the Environmental Protection Agency published a final "Tailoring Rule" requiring existing and new stationary sources, such as coal-fired power plants, to obtain operating permits if they emit GHG equivalent to more than 100,000 metric tons of carbon dioxide (equivalent) per year. These requirements are scheduled to take effect in the first half of 2011.
In July 2010, the EPA issued its draft Transport Rule and is expected to issue its Air Toxics Rule in March of 2011. These rules will set significantly more stringent limits on emissions of sulfur dioxide, nitrogen oxide, mercury and acid gases from power plants. BernsteinResearch estimates that by 2015, when both rules take effect, 15% of coal fired power plants will be unable to meet these regulations and will be retired, and numerous others will require substantial investments to achieve compliance.
Many utilities, including Xcel Energy, Calpine Corporation, and Progress Energy are shutting down or replacing coal-fired power plants, having determined that doing so is more cost-effective than retrofitting the plants to comply with U.S. EPA's Transport and Air Toxics Rules.
The Tennessee Valley Authority (TVA) has announced plans to, over the next five years, idle 1000 MW of coal generating capacity and add 1000 MW of gas and 1140 MW of nuclear generating capacity along with 1900 MW of energy efficiency and distributed renewable resources.
Some of Dynegy Inc.’s electric industry peers who have set absolute GHG emissions reduction targets include American Electric Power, Entergy, Duke Energy, Exelon, National Grid and Consolidated Edison. Those with GHG intensity targets include CMS
Energy, PSEG, NiSource and Pinnacle West.
Shareholders request that the Company adopt quantitative goals for the reduction of greenhouse gas and other air emissions in anticipation of emerging EPA regulations, including plans to retrofit or retire it's existing coal plants; and that the Company report to shareholders by September 30, 2011, on its plans to achieve this goal. Such a report will omit proprietary information and be prepared at reasonable cost.