Brianna Cayo Cotter, 415.305.1943
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Rainforest Action Network (RAN) is calling on private banks around the world to reject Dallas-based utility company TXU’s solicitations for $11 billion in debt and equity to finance 11 new coal-fired power plants in Texas. If completed, the new plants will result in 78 million tons of new carbon dioxide (CO2) emissions per year – greater than the total greenhouse gas emissions of many countries.
The plants, which TXU says will produce nine gigawatts of electricity by 2011, represent the first phase of TXU’s recently-announced expansion strategy that also includes the construction of up to 14 additional gigawatts of similar coal-fired power plants in other parts of the country.
If TXU’s full expansion plan were to be completed, TXU would become the largest corporate greenhouse gas polluter in the United States. The outdated pulverized coal-fired technology being promoted by TXU is widely recognized by regulators and scientists as the highest greenhouse-gas (GHG)-polluting source of electricity. RAN has issued formal letters to 54 financial institutions, asking them to withhold financing for TXU’s project. The letters, from RAN’s Executive Director Michael Brune, called the TXU project a “risky transaction” and warned that in addition to the significant climate concerns, the expansion of the coal industry “is associated with destructive and unsafe methods of extraction, as well as the harmful local impacts of mercury and nitrogen oxide pollution.”
The letters also challenged banks to implement climate and energy policy protections that would ensure that they reduce the GHG intensity of their investments, and to support renewable energy sources such as wind and solar while shifting financial resources away from dangerous energy sources such as coal and nuclear.
Although GHG emissions are a leading contributor to climate change, CO2 emissions are currently unregulated in Texas and at the federal level in the . Texas already suffers from the country’s highest rate of CO2 emissions, while the generates the most GHG emissions in the world. The 78 million tons of CO2 pollution from TXU’s proposed project will be:
* Greater than the GHG emissions of 21 states.
* Larger than the total GHG emissions of several countries, including , , and .
* Larger than ’s entire emission reduction commitment under the Kyoto Protocol.
* Twice as large as ’s Kyoto emission reduction commitment.
* More than 80 percent of the ’s Kyoto emission reduction commitment.
* Equivalent to the annual GHG emissions of adding 14 million new cars to roads.
“While governments and corporations around the world are confronting and trying to solve the global climate crisis, TXU is boldly proposing one of the most destructive ventures ever seen,” said Brune. “The world’s financial institutions can prevent this project from ever leaving the ground by simply declining to be a part of it. We’re calling on banks to say no to TXU’s dirty energy schemes, and to embrace the environmental values held by their customers, employees and shareholders.”
The projects three lead arrangers are Citigroup, Morgan Stanley, and Merrill Lynch. In addition, Barclays Capital, Calyon and WestLB have been named as second-tier lenders, and numerous other banks have been approached to join the financing syndicate, including Société Générale, Mizuho Corporate Bank, Bank of Tokyo-Mitsubishi, HypoVereinsbank, Scotiabank, ABN AMRO, Wachovia and HSBC.