Organization: Pepco Holdings, Inc.

Year: 2012

Description:

In a 2011 report sponsored by the National Academy of Sciences ("NAS") and requested by u.S. Congress, a committee of renowned sCientists, engineers, economists, business leaders and policy makers reaffirmed the widespread scientific consensus that human-related activities, especially the release of greenhouse gas emissions in the atmosphere, are the most likely causes of the global warming observed over the past few decades. NAS further asserted that this warming trend could not be explained by natural forces such as internal climate variability or changes from the incoming energy of the sun. Consequently, NAS, along with scientific academies from 10 foreign countries, reiterated the urgent need for substantial action by all nations to reduce greenhouse gas emissions in order to divert the worst possible consequences of global warming. Here, majority of u.S. states adopted initiatives to reduce greenhouse gas emissions, with at least 34 states having established special government commissions, action plans, reporting requirements and/or renewable energy portfolios standards for utilities, power generators, and energy companies to regulate greenhouse gas emissions. The business world itself is also recognizing the risks of climate change. In a 2008 study conducted by Ernst & Young and Oxford Analytica, the insurance industry listed climate change as the number one risk facing the insurance industry, citing potentially long-term, far-reaching and significant impacts on the industry as a whole. The electric industry accounts for more carbon dioxide emissions than any other sector, including the transportation and industrial sectors. U.S. power plants are responsible for nearly 40 percent of u.S. carbon dioxide emissions, and 10 percent of global carbon dioxide emissions. In the Carbon Disclosure Project's most recent annual survey of the S&P 500 (released 2010), 55% of utility companies and 51% of energy companies in the S&P 500 are actively implementing greenhouse gas emissions reduction targets. Moreover, 57% of energy companies and 66% of utility companies in the S&P 500 see significant physical risks (including extreme weather) resulting from climate change. Some of Pepco's industry peers who have set absolute reduction targets include American Electric Power, the nation's largest electric generator, Entergy, Duke Energy, Exelon, National Grid and Consolidated Edison. Moreover, Duke, Exelon, PG&E Corp, Shell, AES, Conoco Phillips, NRG, GE and others, through their participation in the U.S. Climate Action Partnership, have also publicly stated that the U.S. should reduce its GHG footprint by 60% to 80% from current levels by 2050. RESOLVED: Shareholders request that the Board of Directors adopt quantitative goals, based on current technologies, for reducing total greenhouse gas emissions from the Company's products and operations; and that the Company report to shareholders by September 30, 2013, on its plans to achieve these goals. Such a report will omit proprietary information and be prepared at reasonable cost.