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New York City Will Divest Pension Funds from Fossil Fuel Companies

New York City Will Divest Pension Funds from Fossil Fuel Companies thumbnail

Today New York Mayor Bill De Blasio announced a goal to divest New York City’s pension funds from fossil fuel reserve owners within five years. This makes New York the first major American city to announce such a move.

According to a statement, the city’s five pension funds have approximately $5 billion invested in over 190 fossil fuel companies.

“New York City is standing up for future generations by becoming the first major U.S. city to divest our pension funds from fossil fuels,” said Mayor de Blasio. “At the same time, we’re bringing the fight against climate change straight to the fossil fuel companies that knew about its effects and intentionally misled the public to protect their profits.”

Mayor de Blasio explained how the city was “bringing the fight” when he also announced the city will be suing the five largest investor-owned fossil fuel companies — BP, Chevron, ConocoPhillips, Exxon Mobil, and Royal Dutch Shell — and seeking damages for the money the city will have to spend to protect itself against the impacts of climate change.

This is in addition to separate legal action by New York Attorney General Eric Schneiderman to hold the industry accountable for misleading the public about climate change. Schneiderman’s lawsuit against ExxonMobil claims that there is evidence that Exxon had “two sets of numbers” used to discuss the impact of climate change on the company — one set for the public and one for private company conversations.

Climate activist and author Bill McKibben hailed the announcement. “They should light up the Empire State Building in green tonight — for the money the city is going to save, and for the planet it will help protect in the process,” he said in a New York Daily News op-ed.

Climate change is perhaps the toughest challenge New York City will face in the coming decades,” de Blasio said in today’s statement.

Protecting the Island City

With this divestment decision and lawsuit, New York City is placing itself at the forefront of the fight against climate change. Which makes sense because New York, a city surrounded by water, is on the frontline when it comes to climate change impacts as well, from sea level rise to intense storms. And for a city the size of New York, dealing with climate change will not be cheap.

New York Times article this week describes efforts to redraw the city’s flood maps, noting, “With its 520 miles of coastline and thousands of acres of waterfront development, New York has more residents living in high-risk flood zones than any other city in the country.” In 2012 Superstorm Sandy hit New York and surrounding areas, and the resulting roughly $70 billion in storm damages made it the second-costliest weather disaster in U.S. history, second only to Hurricane Katrina. Approximately $19 billion of those damages were in New York City alone, according to the New York  City Office of Management and Budget.

This week the city administration also acknowledged that while $20 billion has been budgeted to deal with the coming impacts of climate change — that will only be a first step. New York City will continue to deal with the risks of storms like 2012’s Sandy as well as the inevitable impacts of sea level rise, and solutions, even if successful, will be very costly.

Various proposals to protect NYC from the ocean’s rise have been floated, and none are cheap. Ideas include building a string of barrier islands from New Jersey to Long Island and simply building a wall around lower Manhattan.

New York avoided the recent flooding that Boston experienced in the first major storm of 2018. Still, Boston experienced its highest tide in 100 years during this storm, showing what may await other coastal cities. New models say that storms will cause major flooding in New York City every five years.

And models that predict sea level rise show that drastic measures will have to be enacted to protect the city from the ocean.

Who Will Pay for It?

A day before New York’s announcement, Jack Gerard, CEO of the American Petroleum Institute, gave his annual address on the state of the oil industry, and there was a noticeable shift in the message when it came to climate change.

I think we’re at the point where we need to get over the conversation of who believes and who doesn’t, and move to a conversation about solutions,” Gerard said, referring to climate change.

Even the head of the oil and gas industry’s largest lobbying group publicly says that climate change is real and he wants to discuss solutions. Of course, one solution, pointed out by scientists, is to greatly reduce the amount of carbon humans release into the atmosphere by leaving fossil fuels in the ground, which might minimize future costs and damages.

However, enough greenhouse gases have already been emitted to lock in a significant level of global warming and related changes to Earth’s systems. Cities like New York are now facing the very costly consequences of global inaction to reduce climate change. API likely realizes that when it comes time to pay the bill for climate change, many will ask oil companies and other major polluters to cover the cost, which is probably not the solution Gerard is looking for.

Which is also probably one reason API is working to influence judges in America, as The Center for Public Integrity reported in 2017. As damages due to climate change continue to stack up, more lawsuits against the deep-pocketed companies who are at least partially responsible will likely also be on the rise.

The costs to address climate damages and prepare for future impacts are enormous and growing,” said Peter Frumhoff, director of science and policy and chief climate scientist at the Union of Concerned Scientists. “Taxpayers and impacted communities are right to demand that major fossil fuel companies, which have knowingly made the situation worse, pay their fair share.”

New York City is taking historic steps to address the very real dangers of climate change because when you are the mayor of a city surrounded by water like Mayor de Blasio, there is one thing you can bank on.

The next storm is out there — it’s not a matter of if, but when,” de Blasio said.

More intense and frequent storms will come and the sea will rise. The question remains who will pay for the damage.

By Justin Mikulka

Desmog Blog



21 Comments on "New York City Will Divest Pension Funds from Fossil Fuel Companies"

  1. Mad Kat on Wed, 17th Jan 2018 6:12 am 

    When the financial collapse comes, there will be no ‘pension funds’. Zip. Zero. Nada. None. Nor will there be 401ks or any other capitalist/stocks/bonds supported savings or retirement plans. I don’t think they have five years. Maybe not even one. What will a 90% plunge in the stock market cause? Only time will tell.

  2. TheNationalist on Wed, 17th Jan 2018 6:17 am 

    What a load of bollocks. How American, all the cunts with money start suing each other whilst Rome burns. They pretend they”didn’t know” and the ads got me!
    Anyone with an A level in chemistry or maths should not have fallen for the typical advertsing bullshit. Jesus H. frickin christ, next they will all be blaming Trump!
    Oh wait…..

  3. Go Speed Racer on Wed, 17th Jan 2018 6:34 am 

    LOL. That will save the planet, big city
    rich limousine liberals, making their statement,
    while they throw out enough garbage to be
    seen from outer space every day.

  4. MASTERMIND on Wed, 17th Jan 2018 7:03 am 

    Nationalist

    What happened to the US dollar? Thanks to Trump it declined so much he lost all of his stock market gains! Investors dont want to invest in a country ruled by a half wit…Thanks you fucking retard!

  5. deadly on Wed, 17th Jan 2018 7:25 am 

    New York City is selling at the all-time high and avoiding a bloodbath.

    A red flag.

  6. baha on Wed, 17th Jan 2018 8:06 am 

    Kudos to them.

    Divestment will bring about the end of the FF industry. Use your money to control your future.

  7. Davy on Wed, 17th Jan 2018 9:42 am 

    Divestment is a hollow jester from a city Unwilling to significantly change its behavior. It is activity like this that ensures the problem will not go away. We will tell ourselves lies that make us think it is going to be better instead of effective strategies of change.

  8. Outcast_Searcher on Wed, 17th Jan 2018 9:56 am 

    Right Davy.

    As always, it’s about money. A Mayor doesn’t want the city to pay for the protection the city needs. Imagine that! (sarc)

    IF NYC bans/greatly mitigates the USE of all fossil fuels, in a bid to actually do something about the problem and set the world an example, THEN I’d be a bit impressed.

    When they knuckle down and collect the taxies to deal with the SLR problem, I’ll be really impressed.

    Meanwhile, their subway system is an unmitigated disaster, which they don’t fix, despite the NYT whining that many people, especially “poor” people, need it every day.

    “And why don’t they fix it?”, you may ask. Because riders don’t want to pay the full cost for riding, and politicians want to be re-elected, OF COURSE.

    Since the Subway is pocket change compared to truly dealing with NYC SLR long term, game over, as far as real mitigation vs. political side shows like suing fossil fuel companies while continuing to use huge amounts of their products every day.

  9. Outcast_Searcher on Wed, 17th Jan 2018 10:01 am 

    Come on baha, you know better than that. Only refusing to buy the FF industry’s PRODUCTS will end the industry. The rest is just diversionary key jingling re politics.

    If NYC will buy the products Chevron makes, for example, I’m happy to own some CVX as long as they grow profits over time and pay a good dividend. Even if I’m driving an EV and charging it with a solar roof, etc.

    Because, logically, as long as there is an internationally growing market for FF’s – the consequences are obvious.

    And thus far, the credible estimates are for more oil to be sold and burned through 2040 or 2050 or so (and perhaps beyond).

  10. Outcast_Searcher on Wed, 17th Jan 2018 10:07 am 

    Mastermind: 25%ish (SPX gain) > 15%ish (DXY loss). (Measuring from 1/1/17 to now).

    But of course you knew that.

    But just keep making stuff up.

  11. Cloggie on Wed, 17th Jan 2018 11:42 am 

    Never understood why there can’t be a green-right political movement.

    Go on mr Blasio, sue Shell so hard that they have to convert themselves into a renewable energy company.

    Various proposals to protect NYC from the ocean’s rise have been floated, and none are cheap. Ideas include building a string of barrier islands from New Jersey to Long Island and simply building a wall around lower Manhattan.

    My advice: sell Manhattan back to the “Indians” for 60 Dutch guilders:

    https://s.hswstatic.com/gif/nutmeg-new-netherland-1.jpg

    http://60guilders.com/

    Perhaps they can make a beach resort out of it or something.

  12. Shortend on Wed, 17th Jan 2018 1:05 pm 

    The Donald made them do it! He may be a stable genius, but he’s crazy as a loon and only thinks GREEN….$$$$$
    Simple Physics and Chemistry… Alright!

  13. MASTERMIND on Wed, 17th Jan 2018 1:15 pm 

    Clogg

    A green right movement? Maybe its because right wingers in America could give a flying fuck about the environment or anything on it. All they care about is themselves and pushing their religious nonsense on everyone else. The right party in America has basically turned into a party of Conspiracy loons, racist, religious zealots,…LOL

  14. Anonymous on Wed, 17th Jan 2018 3:08 pm 

    Coast Guard shows how hypocritical these fatcats are:

    http://www.oneidadispatch.com/article/OD/20150204/NEWS/150209901

  15. Norman Pagett on Wed, 17th Jan 2018 5:03 pm 

    how cane point out to the economic brains of NYC that there are no assets free of oil

    oil is what built our industrial/commercial economic system.

    remove oil and we do not have an industrial infrastructure

    oil underpins the value of everything we have, everything we do—it would be as easy to insist on stopping investments in breathing.

    I await the new investment portfolio with interst–to look ant the oil free assets

    Farmland??—impossible without oil input

    buildings?—sustained by oil input

    shipping?—same again

    the fact remains there’s nothing at all that does not entirely depend on oil

    remove oil, and all ”value” vanishes

  16. Sissyfuss on Wed, 17th Jan 2018 6:25 pm 

    Gee Norm, that sounds like a predicament.

  17. DMyers on Wed, 17th Jan 2018 7:47 pm 

    “Hey, Mayor De Blasio, how much money we got in them fosile fewells?

    “I’m not prepared to discuss any numbers.”

    “Must be somethin. Where’s all that money gonna go now?”

    “Let’s just say, I get by with a little help from my friends, and they get by with a little help from me.”

    “Can I quote you on that?”

    “…Not really.”

    “Always a good cause with you, eh brother?”

    “Amen!” [fading laughter during walk to bank]

    .

  18. DerHundistlos on Wed, 17th Jan 2018 10:24 pm 

    Good for New York!!!!!!

  19. Cloggie on Thu, 18th Jan 2018 12:07 am 

    Norman is certain: “Houston, we’ve got a problem”.

    https://www.amazon.com/Our-Renewable-Future-Hundred-Percent/dp/1610917790/ref=sr_1_sc_1

    Geez, I had sworn to myself never to quote Heinberg again.

  20. DerHundistlos on Thu, 18th Jan 2018 4:35 am 

    MUST SEE

    What a Way to Go – Life at the End of Empire:

    https://youtu.be/h2em1x2j9-o

  21. Dredd on Fri, 19th Jan 2018 6:42 am 

    Good move NY.

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