A proposal asking FirstEnergy Corp. to report on its efforts to reduce the environmental and health hazards of coal ash stored in ponds, landfills and mines got about 36 percent of the vote today at the company's annual meeting.
"This is a very strong vote, and we believe it sends a clear message to the company that its shareholders are very concerned about this issue and require increased transparency," commented Larisa Ruoff, director of shareholder advocacy for Green Century Capital Management, which filed the proposal, along with the Adrian Dominican Sisters, an international congregation of approximately 800 vowed religious women with over 30 years of commitment to, and practice of, socially responsible investing (SRI).
"Over half of FirstEnergy's generation capacity comes from burning coal, yet the company fails to provide investors meaningful information about how it prevents harmful environmental impacts and mitigates coal ash-related risks," said Christopher Matthias, of the Adrian Dominican Sisters.
Coal ash is a byproduct of coal-fired power plants that contains arsenic, mercury, lead, and other toxins left after combustion or filtered out of smokestack scrubbers. The health, environmental, and financial risks of managing coal ash came to light in December 2008 when a dam holding back a 1.1 billion gallon coal ash pond belonging to the Tennessee Valley Authority (TVA) burst and covered over 300 acres with toxic sludge. TVA has estimated spill-related costs at $1.2 billion and has been the target of over 50 lawsuits since the spill.
"FirstEnergy's ash storage practices at the Little Blue Run dam expose the company to significant financial and regulatory risks due to environmental and health hazards caused by coal ash," said Ruoff. Every day, up to 3.2 million gallons of coal ash waste is sent to the Little Blue Run Dam facility.
"At the same time, FirstEnergy's public disclosure on this issue is insufficient. The company does not provide information on the efforts it is taking to reduce environmental and health hazards associated with the coal ash it produces. As a result, investors cannot make informed decisions regarding to whether the company is adequately managing coal ash related risks," she continued.
FirstEnergy, headquartered in Akron, Ohio, says it's an environmental leader and points to its accomplishments on its Web site. It is a diversified energy company with ten electric distribution companies that make up the nation's largest investor-owned electric system.
Last month, shareholders in Ameren Corporation voted on a similar proposal where over half of the shares voted supported the resolution calling for increased transparency and accountability. Later this month, shareholders at Southern Company* will have the opportunity to vote on the issue as well.