In a development climate campaigners welcomed as a harbinger of more institutions ditching fossil fuel investments, New York state’s pension fund will divest $7 million from seven tar sands companies, the state comptroller announced Monday.
“As nations around the world become increasingly serious about addressing the threat of climate change and as market forces drive a low-carbon economic transition, we need to make sure our investments line up with this reality,” said New York State Comptroller Thomas DiNapoli in a statement.
“We have carefully reviewed companies in the oil sands industry and are restricting investments in those that do not have viable plans to adapt to the low-carbon future,” he said. “Companies responsible for large greenhouse gas emissions, like those in this industry, pose significant risks for investors.”
New York’s is the nation’s third largest public pension fund, holding $247.7 billion in assets.
NY state’s pension fund is protecting our investments from climate change. We’re restricting oil sands companies that aren’t adapting to a low carbon future. They produce highly carbon-intensive crude oil + pose significant risks to the Fund’s investments. https://t.co/VGwfRIzQQq— Tom DiNapoli (@NYSComptroller) April 12, 2021
Seven companies were singled out by the comptroller because they “failed to show they are transitioning out of oil sands production”—Imperial Oil, Canadian Natural Resources, Husky Energy, MEG Energy Corp., Athabasca Oil Corporation, Cenovus Energy, and Japan Petroleum Exploration.
In addition to selling off the over $7 million in securities it now holds in those companies, the pension fund will not in the future purchase or directly hold debt or equity securities in them.
The divestment announcement reflects the broader plan for the pension fund to divest from fossil fuels and conduct reviews of the “riskiest” fossil fuel assets. In December, DiNapoli announced a 2040 goal for net-zero carbon emissions for the fund.
DiNapoli, a Democrat, said last year that the fund divested from “22 thermal coal mining companies that are not prepared to thrive, or even survive, in the low-carbon economy.” Coming under the comptroller office’s scrutiny next for such climate reviews are firms engaged in fracking.
Among those cheering Monday’s announcement was author and 350.org co-founder Bill McKibben, who said tar sands were worthy of particularly condemnation.
“Alberta’s oil patch is the dirtiest of the dirtiest—there’s no need for this crude, and no place for it on a planet serious about the climate crisis. Kudos to Tom DiNapoli for making it clear that you can’t build your retirement on tar sands,” said McKibben.
Richard Brooks with environmental advocacy group Stand. Earth said the divestment news was “no small matter.”
“This is only the beginning,” he said, “as other North American pension funds are increasingly recognizing that the tar sands is a risky investment both for pensioners and our planet.”
“It’s time to pivot to clean, safe renewable energy,” he continued. “That’s where the smart money, led by New York, is headed.”