Water scarcity risk in municipal bond market explored in new report

• Warning to be sounded that credit rating agencies are ignoring water risks to bond investors; Utilities in LA, Phoenix/Glendale, Atlanta, Dallas/Fort Worth, Alabama to be highlighted

WASHINGTON, DC & London, England, Oct. 19, 2010 -- Growing water scarcity in many parts of the United States is a 'hidden risk" for investors who buy the water and electric utility bonds that finance much of the US's vast public water infrastructure, according to a new report that will be released at 11 a.m. EDT/4 p.m. GMT Thursday (October 21, 2010) on a live-phone based news conference.

Of interest to all bond investors, the report is a first-time look at why investors should be treating water scarcity as a growing credit risk in water and electric utility bonds -- and how these risks are currently being ignored by credit rating agencies rating municipal bonds.

The report includes a quantitative model developed by PwC to assess both water and electric utility water risk exposure by comparing their available supplies with projected water demand up to 2030, using stress scenarios that incorporate climate change impacts, regional water conflicts and other potential external risks on water supplies.

The report examines water scarcity risks for specific water utilities in water-stressed regions: Los Angeles, Phoenix, Glendale (AZ), Atlanta and Dallas/Forth Worth. The report also focuses on water scarcity risks for municipally owned electric power utilities, including public utilities serving Los Angeles and southern Alabama/northwest Florida.

News event speakers will be:

• Mindy Lubber, president of Ceres;
• Celine Herweijer, director, PwC Sustainability and Climate Change
• Jon Williams, Partner PwC Sustainability and Climate Change
• Bruce Kahn, director and senior investment analyst, DB Climate Change Advisors, Deutsche Asset Management.

TO PARTICIPATE: You can join this live, phone-based news conference (with full, two-way Q&A) at 11 a.m. EDT/4 p.m. GMT on October 21, 2010 by dialing 1 (800) 860-2442 in the U.S. or 080-823-89064 in London/the United Kingdom. (A separate toll line is available for callers outside the U.S./United Kingdom.) Ask for the "water bond risk report telenews event."

CAN'T PARTICIPATE?: A streaming audio replay of the news event will be available on the Web at http://www.ceres.org as of 3 p.m. EDT/8 p.m. GMT on October 21, 2010.

CONTACT: Peyton Fleming, Ceres, 617-733-6660 or [email protected]; Rowena Mearley, media relations, PwC, +44 207 2134727, or [email protected], and Leslie Anderson, (703) 276-3256 or [email protected].

Ceres is a national coalition of investors, environmental groups, and other public interest organizations working with companies to address sustainability challenges such as water scarcity and climate change. Ceres directs the Investor Network on Climate Risk (INCR), a network of 95 institutional investors with collective assets totaling $9 trillion focused on the financial risks and investment opportunities from climate change.

PricewaterhouseCoopers LLP UK is part of the global PwC Sustainability and Climate Change network, including over 800 dedicated staff. PwC firms provide industry-focused assurance, tax and advisory services to enhance value for their clients. More than 163,000 people in 151 countries in firms across the PwC network share their thinking, experience and solutions to develop fresh perspectives and practical advice. See pwc.com for more information.

"PricewaterhouseCoopers" refers to PricewaterhouseCoopers LLP (a limited liability partnership in the United Kingdom) or, as the context requires, the PricewaterhouseCoopers global network or other member firms in the network, each of which is a separate and independent legal entity.

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