New York state Attorney General Eric Schneiderman says coal giant Peabody Energy made false and misleading statements to investors about the financial risks it faces because of climate change.
As part of an agreement with Schneiderman's office, the company has agreed to revise the disclosures it makes to investors about the risks in its quarterly report released today, and has promised to include the disclosures in future filings.
Peabody did not admit wrongdoing and faces no financial penalties as a result of the agreement, The New York Times reported. The newspaper adds:
"The Peabody agreement will not include a monetary settlement. Its impact will surely pale in comparison with the other problems Peabody faces as demand for coal plummets, replaced by cleaner-burning natural gas.
"Shares of Peabody, which is based in St. Louis, have lost more than 90 percent of their value over the last year as the entire industry has been overwhelmed by crippling debts and more stringent regulations on coal burning by electric utilities."
Schneiderman said in a statement that Peabody, as a publicly traded company, has a responsibility to be honest with shareholders and the public about climate change risks:
"I believe that full and fair disclosures by Peabody and other fossil fuel companies will lead investors to think long and hard about the damage these companies are doing to our planet."
The announcement of the agreement comes several days after Schneiderman's office announced a separate investigation into whether Exxon Mobil lied to the public about climate change.
An investigation by the attorney general's office found that Peabody repeatedly stated that it couldn't predict the impact of climate change regulation on its bottom line, even though consultants hired by Peabody had projected that it would have a "severe impact."
At one point, Peabody projected that "specific aggressive regulatory action" against existing power plants could reduce the value of U.S. coal sales by a third.
The investigation also found that Peabody made "incomplete and one-sided" statements about projections of future global coal demand issued by the International Energy Agency.
Peabody defended itself in a statement, saying it "has always sought to make appropriate disclosures":
"Peabody has been among the most vocal companies worldwide in advocating clean coal technologies, including greater deployment of high-efficiency low-emissions coal-fueled plants and development of next-generation carbon capture, use and storage technologies."