Environment Group Slams Power Cos Over Global Warming

Dow Jones & Company, Inc. - Nov 30

BRUSSELS (Dow Jones)--Power companies have failed in their efforts to invest in renewable energy and combat global warming, a World Wildlife Fund report said Tuesday.

The report ranks 72 electric power companies around the world based on their environmental friendliness. On a scale of 0-10, about two thirds of the companies scored below one.

We want "to unmask the world's biggest polluters: electric power companies," said Jennifer Morgan , director of the Fund's climate change program. "The power sector is the biggest single polluter of greenhouse gases, responsible for 37% of CO2 emissions from the burning of fossil fuels."

Spanish company Iberdrola SA (IBE.MC) scored the highest - 4.3 - due to its investments in wind, other renewals and energy-efficient gas-fired heat and power plants.

Europe performed better than the U.S. More than 75% of U.S. companies ranked less than one, compared with only 43% of European companies.

Some 24% of U.S. companies scored zero, including Duke Energy (DUK), DPL (DPL) , Allegheny Energy (AYE) and Southern Co. (SO).

A total of 12 companies scored zero, including four Japanese companies and one Australian company Loy Yang Power .

The fund called for the shutdown of all coal fired electricity plants, which emit 70% more CO2 than natural gas. It favors wind and biomass power, where plant materials are converted into fuel that can create electricity.

The report is the first step in the World Wildlife Fund's international campaign called Powerswitch to make electric power less damaging to the environment.

The Brussels-based industry lobby group Eurelectric defended the environmental record of its European members.

"Our members have consistently reduced the amount of emissions per megawatt hour," of electricity, said John Scowcroft, head of environment and sustainable development at Eurelectric.

European power generators are producing around a third more power than they did 15 years ago, while they have reduced their emissions of carbon dioxide by 2% at the same time, Scowcroft said.

From January companies will be able to trade the difference between the amount they pollute and their limit in an E.U.-wide emissions' trading system.

"It will be interesting to see if the introduction of a price for carbon will send the right investment signals," to companies, Scowcroft said.

To date, 16 of the E.U.'s 25 member nations have qualified for the scheme, which is designed to reduce Europe's costs of meeting emission reduction targets under the Kyoto Protocol on climate change.

The plans cover pollution quotas for around 7,200 installations, mainly factories and power plants. Taken together, these schemes cover 55% of the total number of installations that are to be given pollution quotas.

-By Kimberly Peterson , Dow Jones Newswires; 322-285-0131; djnews@dowjones.com

Victoria Knight in Brussels also contributed to this article.