Carbon risks of proposed KS coal plant outweigh benefits

There's some compelling new research out today from Innovest regarding one proposed coal-fired power plant in Kansas. Here's the Innovest release, with the highlights bolded by me:

25 March 2008 - Innovest Strategic Value Advisors, the world’s #1 provider of financial research that quantifies hidden risks and value, today released a case study on coal-plant financing called ‘Sunflower Electric Power: Carbon Risks Outweigh Benefits of Holcomb Expansion’. The report examines how current and proposed regulatory scenarios, alternatives to coal-fired generation, regulatory and stakeholder opposition, and rising construction costs continue to shift the competitive balance away from coal-fired electricity generation.

Innovest examined the economics of the transaction and determined that under the most plausible regulatory scenarios the decision to build new coal generating capacity will put Sunflower Electric’s ratepayers – who in this particular case are the actual owners – at significant risk. The report concludes that Sunflower’s management has not adequately addressed the competitive and financial risks associated with climate change in deciding to pursue the expansion of its Holcomb Station power plant.

Kansas Gov. Kathleen Sebelius recently vetoed the bill that would create this plant (and another), and the battle is on now to stop the override of that veto. To read the entire report from Innovest, click here to go to its homepage.