Data released today shows UK local authorities have invested £14 billion of their pension funds into fossil fuels. This is the first time that the £231 billion investments of all 418 local councils have been broken down and released publicly. The data ranks local councils by their fossil fuel exposure and reveals both the financial threat to pensions and the climate risks. #DivestPensions.
Danni Paffard of 350.org said: “Public investments in fossil fuels are fuelling dangerous climate change, and present a threat to the pensions of 4.6 million public sector workers. There’s a strong ethical and financial case for local councils to divest from fossil fuels and reinvest into infrastructure fit for the 21st century.”
The data and online map released by 350.org, Platform, Community Reinvest and Friends of the Earth ranks councils by their fossil fuel investments, and allows residents to see what their local council has invested into. The data suggests councils are failing to properly manage the financial risks of investments in fossil fuels nor take responsibility for climate action.
The accompanying briefing analysing the data for Local Authority Pensions shows:
– UK local councils have invested £218 per resident into risky fossil fuels. Greater Manchester invests £483 per resident.
– The largest investments have been made by Manchester (£1.3 billion), Strathclyde (£750m) and West Yorkshire (£670m).
– Over 6% of local government pensions are invested in fossil fuels. Merton (11%), Worcestershire (10.7%) and Camden (9.5%) have especially high exposure.
– Three quarters of direct fossil fuel shareholdings are in only ten companies, headed by BP and Shell.
Reinvesting the £14 billion of fossil fuel shares into local infrastructure could enable UK councils to safeguard pensions and generate sustainable returns by:
– Building over 200,000 new homes for social housing, or
– Placing solar panels on 2 million homes, 10,000 schools and 20,000 public buildings, adding 8.9 GW of electricity capacity – more than Scotland consumes.
“Instead of wasting £14 billion of public pensions on multinational climate wreckers, we could reinvest into renewables and housing that serve local residents, create jobs and safeguard pensions.” – Mika Minio of Platform
Jane Ivimey, a local authority pension-holder and member of Fossil Free Oxfordshire, said: “We don’t want fossil fuels to destroy our pensions, and we don’t want our pensions to destroy everyone’s future.”
Kirsty Noble, Strathclyde Pension Fund member said: “Local governments and their pension funds really have to take the lead in action to avert climate change – whatever the rest of us do individually is small in comparison with the potential for government action. Given the growing understanding of the need to ‘keep it in the ground’ these investments are increasingly risky and the local authority funds seem to be overexposed to this risk.”
12 new local campaigns calling for their council to divest from fossil fuels will also launch today, adding to the 18 existing initiatives. Oxford and Bristol City Councils have already taken a lead in making fossil free commitments, joining 50 cities internationally and larger institutions like the Norwegian Government Pension Fund. There are 389 institutions globally that have committed to divest.
“Most of the world’s oil, coal and gas has to stay in the ground to prevent runaway climate change. Local government can help protect all our futures by taking pension investments out of these planet-wrecking corporations.” – Simon Bullock , senior climate and energy campaigner at Friends of the Earth
“Local residents and pension-holders won’t be happy that their money is funding climate change. Today we’ll be calling on Greater Manchester to stand on the right side of history and divest from fossil fuels.” – Ali Abbas, Friends of the Earth Manchester, launching a campaign today targeting the Greater Manchester Pension Fund.
Campaigns to divest have been boosted by increased awareness of the financial risks to investors of ‘stranded’ fossil fuel assets, associated with (but not exclusive to) the need to leave 80% of known fossil fuel reserves unburnt to prevent catastrophic climate change. The Bank of England and G20 Financial Stability Board are currently investigating the risk to the economy of the ‘Carbon Bubble’. A recent analysis found that California’s public pension funds, CalPERS & CalSTRS, incurred a combined loss of over $5 billion in the last year alone from their holdings in the top 200 fossil fuel companies.
Natalie Smith, Lawyer of Client Earth commented: “There is a growing body of evidence suggesting that the financial risks associated with climate change will impact investment portfolios. If pension fund trustees fail to properly manage these risks in their investment decision-making process, and there is a consequential decline in value of the pension pots of members, then trustees and investment managers could be sued for breaching their fiduciary duties.”
In March 2014, following a clarification from the UK Law Commission on the interpretation of fiduciary duty, the Local Government Association (LGA) (England & Wales) published a legal opinion on how fiduciary duties affected the scope for a Local Government Pension Scheme (LGPS), concluding that “the precise choice of investment may be influenced by wider social, ethical or environmental considerations, so long as that that does not risk material financial detriment to the fund.”
Build, Buy, Or Retrofit? 3 Green Housing Considerations
Green housing is in high demand, but it’s not yet widely available, posing a serious problem: if you want to live an eco-friendly lifestyle, do you invest in building something new and optimize it for sustainability, or do you retrofit a preexisting building?
The big problem when it comes to choosing between these two options is that building a new home creates more waste than retrofitting specific features of an existing home, but it may be more efficient in the long-run. For those concerned with waste and their environmental footprint, the short term and long term impacts of housing are in close competition with each other.
New Construction Options
One reason that new construction is so desired among green living enthusiasts is that it can be built to reflect our highest priorities. Worried about the environmental costs of heating your home? New construction can be built using passive solar design, a strategy that uses natural light and shade to heat or cool the home. Builders can add optimal insulation, build with all sustainable materials, and build exactly to the scale you need.
In fact, scale is a serious concern for new home buyers and builders alike. Individuals interested in green housing will actively avoid building more home than they need – scaling to the square foot matter because that’s more space you need to heat or cool – and this is harder to do when buying. You’re stuck with someone else’s design. In this vein, Missouri S&T’s Nest Home design, which uses recycled shipping containers, combines the tiny home trend with reuse and sustainability.
The Simple Retrofit
From an environmental perspective, there’s an obvious problem with building a new home: it’s an activity of mass consumption. There are already 120 million single-family homes and duplexes in the United States; do we really need more?
Extensive development alone is a good enough reason to intelligently retrofit an existing home rather than building new green structures, but the key is to do so with as little waste as possible. One option for retrofitting older homes is to install new smart home technology that can automate home regulation to reduce energy use.
Real estate agent Roxanne DeBerry sees clients struggle with issues of efficiency on a regular basis. That’s why she recommends tools like the Nest Thermostat, which develops a responsive heating and cooling schedule for the home and can be remotely adjusted via smartphone. Other smart tools for home efficiency include choosing Energy Star appliances and installing water-saving faucets and low-pressure toilets. These small changes add up.
Ultimately, the most effective approach to green housing is likely to be aggressive retrofitting of everything from period homes to more recent construction. This will reduce material use where possible and prevent further aggressive land use. And finally, designers, activists, and engineers are coming together to develop such structures.
In the UK, for example, designers are interested in finding ways to adapt period houses for greater sustainability without compromising their aesthetics. Many have added solar panels, increased their insulation levels, and recently they even developed imitation sash triple glazed windows. As some have pointed out, the high cost of heating these homes without such changes will push these homes out of relevance without these changes. This is a way of saving existing structures.
Harvard is also working on retrofitting homes for sustainability. Their HouseZero project is designed for near-zero energy use and zero carbon emissions using geothermal heating and temperature radiant surfaces. The buildings bridge the gap between starting over and putting up with unmanageable heating and cooling bills.
It will take a long time to transition the majority of individuals to energy efficient, green housing but we’re headed in the right direction. What will your next home be like? As long as the answer is sustainable, you’re part of the solution to our chronic overuse – of land, energy, water, and more.
How the Auto Industry is Lowering Emissions
Currently, the automotive industry is undergoing an enormous change in a bid to lower carbon emissions. This has been pushed by the Government and their clean air plans, where they have outlined a plan to ban the sale of petrol and diesel cars by 2040.
Public Health Crisis
It is said that the levels of air pollution lead to 40,000 early deaths in the UK, with London being somewhere that is particularly bad. This has led to the new T-Charge, where heavy polluting cars will pay a new charge on top of the existing congestion charge. Other cities have taken action too, with Oxford recently announcing that they will be banning petrol and diesel cars from the city centre by 2020.
It is clear that the Government is taking action, but what about the auto industry? With the sale of petrol and diesel plummeting and a sharp rise in alternatively fuelled vehicles, it is clear that the industry is taking note and switching focus to green cars. There are now all kinds of fantastic eco-friendly cars available and a type to suit every motorist whether it is a small city car or an SUV.
Of course, it is the cars that are currently on the road that are causing the problem. The used car market is enormous and filled with polluting automobiles, but there are steps that you can take to avoid dangerous automobiles. It is now more important than ever to get vehicle checks carried out through HPI, as these can reveal important information about the automobile’s past and they find that 1 in 3 cars has a hidden secret of some kind. Additionally, they can now perform recall checks to see if the manufacturer has recalled that particular automobile. This allows people to shop confidently and find vehicles that are not doing as much damage to the environment as others.
With the rise in sales of alternatively fuelled vehicles, it is now becoming increasingly more common to see them on UK roads. Public perception has changed drastically in the last few years and this is because of the air pollution crisis, as well as the fact that there are now so many different reasons to switch to electric cars, such as Government grants and no road tax. A similar change in public opinion has happened in the United States, with electric car sales up by 47% in 2017.
The US is leading the way for lowering emissions as they have declined by 758 million metric tons since 2005, which is the largest amount by far with the UK in second with a decline of 170 million metric tons. Whilst it is clear that these two nations are doing a good job, there is still a lot of work that needs to be done in order to improve the air quality and stop so many premature deaths as a result of pollution.
With the Government’s plans, incentives to make the change and a change in public perception, it seems that the electric car revolution is fully underway.