Two shareholder proposals urging Southern Co. to disclose how it could be impacted by global warming won significant support Wednesday from some big pension plans and other investors at the utility’s annual shareholder meeting.
Neither resolution passed, but one garnered about a third of shareholders’ votes and the other got about 29 percent, according to the groups supporting the resolutions. Those vote totals are higher than outsiders’ proposals typically get without management’s support.
The two shareholder proposals, backed by a mix of environmental activists, pension funds and other investors, asked for the Atlanta-based utility to tell investors how it will operate and how much it will cost if tighter limits on greenhouse gases go into effect.
The shareholder votes “sent Southern Company’s board and management a strong message,” the sponsors of the resolutions said in a joint press release, to reduce the company’s risk of having to close down coal-fired power plants or to make other changes to deal with the threat of global warming.
Southern spokesman Tim Leljedal declined to say whether the utility will make future disclosures requested by the shareholder groups. He said the company is “actively developing” power plants that produce “carbon-free” power, including solar power farms and an expansion of the Vogtle nuclear plant near Augusta.
“Our focus is developing the industry-leading technologies,” he said, to meet likely future limits on greenhouse gases.
Southern Co. had asked shareholders, who met Wednesday at Callaway Gardens near Columbus, to vote against both non-binding proposals. The company said in a filing that it already discloses much of the requested information to investors or in regulatory filings.
The resolutions were submitted by As You Sow, a shareholder advocacy group, and the Tri-State Coalition for Responsible Investment, a group of religious institutions.
But the resolutions also won backing from some hefty investors, including two of the nation’s largest public employee pensions in California and New York.
“We support the (proposal) asking the company to report on the risks associated with climate change through routine annual disclosures,” said California’s largest public employee pension, CalPERS, in a recent filing. The pension owns about 2.6 percent of Southerns’ shares.
One of the proposals, which got 34 percent of shareholder votes, asks for Southern to do a sort of stress test explaining how it would be affected if it had to produce less carbon dioxide in line with the Paris climate pact agreed to by more than 100 nations last year, including the United States.
The other, which won 29 percent of shareholder votes, asks for Southern’s estimate of its losses from “stranded assets” if it has to shut down its coal-fired power plants as a result.
A similar proposal at Arlington, Va., utility AES Corp. recently won support from roughly 40 percent of its shareholders.
Southern Co., whose coal-fired plants are among the nation’s biggest individual sources of carbon dioxide and other greenhouse gases, is already feeling heat from tougher air pollution rules and growing troubles from a risky bet on construction of an advanced “clean-coal” plant in Mississippi.
The project is billions of dollars over budget, years behind schedule, facing a customer lawsuit and cost caps demanded by state regulators. Southern recently disclosed that the U.S. Securities and Exchange Commission is investigating as well.
The utility’s state-regulated units, including Georgia Power, have closed several coal-fired plants and switched to cheaper, cleaner-burning natural gas-fired plants in recent years, partly due to tighter air pollution rules.
About the Author
