For Immediate Release
Kucinich Asks SEC to Probe Peabody Deal
WASHINGTON - Congressman Dennis Kucinich (D-OH) today asked the Securities and Exchange Commission (SEC) to fully “investigate any and all agreements” related to the Peabody State Energy Campus (PSEC) in southern Illinois.
See the full letter here.
Peabody Energy Corporation persuaded nine regional power agencies to become partial owners of a new coal plant in southern Illinois at a time when coal was widely known to be a bad investment. The deals specified that the ratepayers would pay even if the plant never generated electricity. After foreseeable and preventable cost overruns and poor performance, ratepayers are now forced to buy overpriced electricity from the new coal burning plant located in Marissa, Illinois.
“I request that the SEC investigate whether the entities responsible knew or should have known about the risks surrounding the costs of construction and operation of the power plant, and whether those parties made a full and accurate disclosure regarding these risks,” wrote Kucinich.
There are “troubling questions about the accuracy and thoroughness of the disclosures, particularly when viewed in light of the fact that Peabody Energy’s board consists of individuals from the finance and energy industries who are likely quite familiar with the bond financing market and the interests of institutional investors.”
“[T]he SEC should investigate whether Peabody fully and accurately revealed the risk of rising plant construction costs (or any other risks) when it was marketing ownership shares in PSEC. [T]he SEC should investigate whether … power agencies fully revealed the risks of participating in PSEC when local communities across eight states were being enticed to enter into long-term purchase agreements.”
Congressman Kucinich vowed to protect the ratepayers from the abuses of crafty energy executives. Last week, Congressman Kucinich asked the Federal Energy Regulatory Commission to investigate the deal. Rep. Kucinich also spoke on the House Floor asking, “Did Peabody Energy Company deliberately unload a bad investment on public power organizations serving 217 cities and villages across the Midwest?”
Kucinich has raided the issue among his affected colleagues in Congress, calling “Peabody Coal’s Prairie State coal plant in southern Illinois … a corrupt boondoggle that will raise electric rates and saddle many publically owned utilities with crushing debt obligations.”