Authored by Mikkela Blanton & Ron Bennett
While a large majority of Americans acknowledge that climate change is a problem, and while many people, businesses, and governments alike have taken action to mitigate climate change – doing everything from changing one’s personal diet to promoting biking to work to passing greenhouse gas reduction policies and more – the reality is that far too much money is still invested in fossil fuels. To be sure, since the 2015 Paris Agreement, the world’s biggest banks have invested approximately $2.7 trillion in coal, oil, and gas firms. And it’s not just big banks. Churches, universities, foundations, state pension funds, and more all put money into fossil fuel companies.
But the times are changing and more organizations, businesses, and entities – including entire countries in some cases – have decided to divest from fossil fuels. On December 9, 2020, New York state finalized the decision to divest its $226 billion pension fund from fossil fuels.
The decision may have been motivated, in part, by the desire to “do the right thing,” but it was also practical. As explained by Thomas P. DiNapoli, the state’s comptroller, “investing for the low-carbon future is essential to protect the fund’s long-term value,” referring to the fact that DiNapoli believes that the world is moving away from fossil fuels and that following that movement will result in greater economic success.
According to an article in The New York Times, over the next five years the fund, officially known as the Common Retirement Fund, will begin divesting funds from many fossil fuels. However, the process won’t be complete for another 19 years; the goal is to sell shares in the riskiest oil and gas companies in the next four years and divest from all global warming-contributing companies by 2040.
That’s not to say that the move isn’t significant; it is. While some cities, such as San Francisco, have made divestment commitments, the state of New York’s decision is unprecedented and may pave the way for other states, including Colorado, to do the same. Numerous interest groups, including 350 Colorado and Fossil Free PERA Colorado, have called on the state to follow in the footsteps of dozens of other pension funds that have divested from fossil fuels. The Colorado Public Employees’ Retirement Association, or PERA, currently has upwards of $1.5 billion invested in over 300 oil, gas, and coal companies.
A 2019 study by Corporate Knights, a Toronto-based analysis firm, showed that the Colorado PERA had lost over $1.7 billion in retirement savings since 2009 by continuing to invest in fossil fuels.
Unfortunately, PERA continues to invest Coloradans’ public money in problematic fossil fuel companies such as Suncor and Extraction Oil and Gas, both under scrutiny for harming local communities through dangerous pollution violations, particularly near lower-income communities and communities of color. To highlight the negative impacts of these investments, 350 CO and Fossil Free PERA launched a video earlier this fall from impacted Coloradans to PERA members.
New York’s announcement comes on the heels of other major news related to climate change and big money: Bank of America joined the five other big banks in saying no to Arctic drilling; Jeff Bezos announced the first grantees of his $10 billion Bezos Earth Fund; and Charles Koch, in an unexpected about-face, congratulated President-Elect Biden, and said that he regrets his decades-long partisanship and wants to work with Democrats now.
The climate movement is working. The above acknowledgments are significant and, in some cases, unprecedented, but there’s still work to be done. We need to keep the pressure on to ensure that promises turn into actions; that commitments are carried out. Words are not enough – it’s time to demand big, deliberate, and intentional actions that reflect the urgency of the climate crisis.
If you’re interested in getting involved, here’s how you can take action now:
- Call on PERA to invest public funds in ways that are not only financially viable long-term, but also support the public good. Send a letter to PERA here, calling on PERA to protect Coloradans’ health and safety by curbing fossil fuel investments. Send your letter now and share with your networks.
- Learn more about the issue and share: Check out the Fossil Free PERA website.
Did you enjoy this blog post? If so, please consider supporting our work to divest Colorado from fossil fuels with a donation! Click here to donate.