Water scarcity is becoming a serious risk for corporations, enough so that some are finally talking about it. Ameren (NYSE:AEE), for instance, discloses that low water levels could negatively affect its power plant operations and its ability to comply with legal effluent limits, resulting in load reductions and shutdowns. Indeed, this has already happened. When record drought and extreme heat swept across the Midwest in 2012, low river levels led to a 50% drop in Ameren Missouri's hydroelectric production.
While Ameren acknowledges the risk it faces from water scarcity, it has not disclosed its risk mitigation strategy. All that appears to be changing after concerned shareholders proposed a resolution to compel such disclosure for Ameren's 2013 proxy ballot. The proponent, As You Sow, withdrew the resolution after Ameren agreed to publish details about its water strategy in consultation with the group. This should be good for the company and for shareholders.
One company has been way ahead of the game in understanding and dealing with water's vitality to its operations. Watch our video to find out how it's protecting its long-term production capacity.
Sara Murphy has no position in any stocks mentioned. Follow her on Twitter @SMurphSmiles. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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