… on a quiet day, I can hear her breathing

Tag: fossil fuels

  • Public Pension Funds Have Lost Billions on Their Fossil Fuel Investments: New Analysis

    Spread the love

    Orifginal article by Dana Drugmand republished from DeSmog

    Six major US retirement funds would be worth a combined $21 billion more today if they had divested a decade ago, University of Waterloo researchers find.

    US public pension funds would be worth billions more if they divested from fossil fuels, researchers have found. Credit: Climate Clock

    For U.S. public pension funds, divesting from oil, coal, and gas would result in overall higher financial value.

    That is the key takeaway from a new study examining the past decade’s portfolio performance for several of the largest public pension funds in the country. The analysis by researchers at the University of Waterloo, published today in partnership with the organization Stand.earth, has found that the total cumulative value of six major U.S. public pension funds would have been about 13 percent higher had they divested from fossil fuel holdings ten years ago – equivalent to around $21 million in earnings.

    Using Bloomberg Terminal data, the researchers looked at the actual portfolio performance between December 31, 2012 and December 31, 2022 of six funds: the Alaska Permanent Fund Corporation, California Public Employees’ Retirement System, California State Teachers’ Retirement System, New York State Teachers’ Retirement System, Oregon Public Employees’ Retirement Fund, and the State of Wisconsin Investment Board.

    Then they analyzed how the funds would have done over the same time period if the fossil fuel investments had been divested, and their value spread evenly among the remaining holdings.

    The analysis found that while the total actual value of the six funds was $402.8 billion at the end of 2022, they would have been worth $424.6 without the fossil fuel holdings. 

    “Financially it doesn’t make sense to stay invested [in fossil fuels],” Olaf Weber, a University of Waterloo sustainable finance professor and co-author of the study, told DeSmog.

    He said the findings are consistent with other similar studies, such as a 2019 analysis which found that California and Colorado’s public pension funds would have been a combined $19 billion richer had they divested from fossil fuel holdings in 2009.

    Although major fossil fuel companies have reported record profits over the past year, this growing body of research suggests that it has not significantly boosted the value of pension funds that remain invested in these companies. 

    Experts have pointed out that in addition to the great volatility of the fossil fuel industry’s value,  the sector appears to be bound for long-term, perhaps even permanent, decline.

    “Today the oil and gas sector is in a pitched battle for last place in the stock market,” said Tom Sanzillo, director of financial analysis at the Institute for Energy Economics and Financial Analysis, during an April webinar timed to the release of a report calling for major hospital systems to divest from the industry. 

    While the fossil fuel sector commanded about 28 percent of the stock market in 1980, it now accounts for about 5 percent or less of the market, Sanzillo said during the event.

    Oil and gas sector profits “are unsustainable,” he said, “and their future is on shaky ground.”

    Fossil Fuel Divestment ‘a Win-Win Situation’

    One often-used argument for staying invested in fossil fuels is that it allows investors to try influencing companies through shareholder engagement. The problem with this argument is that shareholder engagement has not been very effective at compelling big polluters to take serious climate action. 

    “The results show there is not really an effect of engagement because if [investors] put pressure on the fossil fuel companies to reduce production, it will have a negative impact on the share price as well,” Weber said. “So that’s kind of a conflict.”  

    Weber and his colleagues also looked at the greenhouse gas emissions associated with the public equity investments of eight U.S. pension funds: the same six plus the Colorado Public Employees’ Retirement Association and the Alaska Retirement Management Board. They found that if the funds had divested from fossil fuel holdings ten years ago, their cumulative carbon spew would have been about 16.6 percent or nearly 280 million tons lower  – the equivalent of the annual energy use of 35 million homes.  

    “[Fossil fuel] divestments are able to create a win-win situation with higher financial returns and lower carbon footprints,” the researchers concluded.

    Orifginal article by Dana Drugmand republished from DeSmog

  • In ‘Climate-Wrecking’ Reversal, Shell Ditches Plans for Oil Production Cut and Hikes Dividend

    Spread the love

    By JAKE JOHNSON Jun 14, 2023

    Original article republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

    Just Stop Oil protesting in London 6 December 2022.
    Just Stop Oil protesting in London 6 December 2022.

    “It will always be profit over people and planet for polluters,” said one campaigner. “Shell simply cannot be trusted—with either their own meager targets or our futures.”

    Shell announced Wednesday that it is raising payouts to wealthy shareholders and scrapping plans to cut oil production by up to 2% annually, a move that environmental groups said lays bare the futility of relying on fossil fuel corporations to voluntarily curb their climate-destroying activities.

    The London-based company, which more than doubled its annual profits last year, said in a press release that it now intends to “achieve cash flow longevity” by keeping oil production stable until 2030 and boosting gas production, even as scientists say a rapid phaseout of fossil fuels is necessary to avert global climate destruction.

    “It is unacceptable that Shell is betting on even more short-term returns to appease shareholders,” said Sjoukje van Oosterhout, Climate Case Shell’s lead researcher. “Shell is now throwing in the towel on reducing oil production and even scaling up gas production.”

    Shell also announced Wednesday that it is hiking its dividend by 15%, a change that’s set to take effect this quarter. In an additional gift to shareholders, the company said it plans to buy back at least $5 billion of its own stock in the second half of 2023.

    “Record profits, off the back of the energy crisis, should be boosting up green investment,” Jonathan Noronha-Gant, a senior campaigner at Global Witness, said in a statement Wednesday. “Instead it’s shareholder pay-outs and a doubling down on climate-wrecking fossil fuels.”

    Shell had previously said its oil and gas production would fall by 1-2% each year through 2030. But as Bloombergreported, Shell justified the newly announced shift by claiming it “achieved its initial output-reduction plan—announced in 2021 amid a focus on cutting carbon emissions—faster than anticipated.”

    Noronha-Gant called Shell’s announcement a “climate bombshell” that “exposes the hollowness behind the setting of such a target.”

    “It will always be profit over people and planet for polluters,” Noronha-Gant said Wednesday. “Shell simply cannot be trusted—with either their own meager targets or our futures.”

    Others responded with similar outrage. Climate scientist Bill McGuire wrote on Twitter that Shell CEO Wael Sawan “knows exactly what the consequences of this decision are.”

    “People will die—are already dying,” McGuire tweeted. “I want to see him jailed—along with all the other CEOs who have been unequivocally complicit in crimes against humanity. And so should you.”

    Shell’s announcement comes weeks after Carbon Brief released an analysis highlighting the oil giant’s tacit admission that limiting warming to 1.5°C by the end of the century means an “immediate end to fossil fuel growth.”

    “Shell had previously claimed that oil and gas production could rise for another decade, even as warming was limited to 1.5°C,” Carbon Brief observed. “The dramatic shift in its new ‘Energy Security Scenarios’ is not explicitly acknowledged, but… is hidden in plain sight.”

    “The immediate end to fossil fuel growth in Shell’s new 1.5°C scenario marks a dramatic shift from its earlier work, which had squared the circle between limiting warming to 1.5°C and continuing to expand oil and gas production by invoking implausibly-large forest expansion,” Carbon Brief added.

    Shell insisted Wednesday that it is “aiming to achieve near-zero methane emissions by 2030” and “net-zero emissions by 2050,” but research released earlier this week showed that such commitments are often meaningless because companies rarely outline specific steps they plan to take to achieve their stated targets.

    Last month, Friends of the Earth Netherlands published a report accusing Shell of overstating its spending on renewable energy solutions by including “the sale of flowers and sandwiches at its gas stations” in the total, along with “biofuels with a high carbon footprint.”

    “The company continues to contribute to catastrophic climate change,” the group concluded.

    Original article republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

  • Net-zero banks show little sign of slowing down fossil fuel financing

    Spread the love

    https://www.energymonitor.ai/finance/banking/net-zero-banks-show-little-sign-of-slowing-down-fossil-fuel-financing/

    A criticism often levelled at Mark Carney’s Glasgow Financial Alliance for Net Zero initiative (GFANZ) and in particular its banking arm, the Net Zero Banking Alliance (NZBA), is that member banks are not required to set firm policies limiting fossil fuel investment.

    New figures published by NGO the Rainforest Action Network (RAN) in its annual ‘Banking on Climate Chaos’ report reveal that the world’s 60 largest banks by asset size, the majority (49) of which have made net-zero commitments, have invested $5.5trn dollars in the fossil fuel industry since the Paris Agreement was signed seven years ago. 

    This new data, which records banks’ lending, debt underwriting and equity capital market activities, adjusting each transaction according to how much exposure the borrower or issuer has to a specific sector, shows that in 2022 alone, the 60 banks provided $673bn to more than 3,000 companies engaged in fossil fuel activities, including $150bn specifically to the top 100 companies expanding fossil fuels. 

    The total sum for 2022 represents a 9% decrease compared with 2021 financing, although RAN’s report dismisses the idea that this reduction indicates “a positive, long-term trend”. This is because a more significant trend observed over the past year, given the current context of “rising interest rates, a strong dollar, and wartime profits”, is that several large oil majors that often account for a significant share of bank loans no longer need banks’ support following a year of bumper profits. 

    …

    https://www.energymonitor.ai/finance/banking/net-zero-banks-show-little-sign-of-slowing-down-fossil-fuel-financing/

  • George Monbiot: The UK’s ‘green day’ has turned into a fossil fuel bonanza – dirty money powers the Sunak government

    Spread the love
    Just Stop Oil protests at BP
    Just Stop Oil protests at BP

    https://www.theguardian.com/commentisfree/2023/mar/29/uk-green-day-fossil-fuel-dirty-money-sunak-renewables

    In prioritising oil and gas over renewables, ministers are doing the bidding of the polluters. And we’ll all pay the price

    Money for the criminals, prison for the heroes: this, in brief, is the government’s climate policy. If something is damaging to the public interest, it’s likely to be rewarde

    Money for the criminals, prison for the heroes: this, in brief, is the government’s climate policy. If something is damaging to the public interest, it’s likely to be rewarded and subsidised. If it’s beneficial, it will find itself in a hostile environment.

    This government represents the denouement of the Pollution Paradox: as dirty money has the greatest incentive to invest in politics, it comes to run the whole system. Across these 13 years of misrule, we have seen the perversities of Conservative government multiply and intensify.

    Thursday was supposed to be “green day”, when the government, forced to act by a court ruling, would unveil a new, more detailed plan for achieving net zero emissions. Instead, the occasion has been rebranded “energy security day”.

    …

    https://www.theguardian.com/commentisfree/2023/mar/29/uk-green-day-fossil-fuel-dirty-money-sunak-renewables

  • Fossil Fuel Linked Donors Gift Half a Million to Conservative Party

    Spread the love

    Original article by Sam Bright republished from DeSmog.

    The CEOs of jet fuel suppliers, gas turbine makers, oil and gas companies are among those who made large donations in the last quarter of 2022.

    Prime Minister Rishi Sunak. Credit: Number 10 Downing Street / Simon Walker, CC BY-NC-ND 2.0

    The Conservative Party has received more than £632,000 in new donations from individuals and firms tied to polluting industries, DeSmog can reveal. 

    New Electoral Commission records released today show that the bulk of the fossil-fuel linked funds came from Christopher Harborne, who donated £500,000 in the final quarter of 2022 – the joint-largest donation registered by the party during this period. 

    Further donations were made by a gas turbine manufacturer, a North Sea oil investor, a petrochemical engineering firm, and a peer with shares in major oil and gas companies.

    The revelation comes at an important moment for UK climate policy. Sunak’s government is due to release an update to its net zero strategy next month after a High Court judge ruled it lacked sufficient detail. 

    The government recently opened up a new round of North Sea oil and gas licences for oil and gas exploration, at a time when the UN has warned that only drastic, immediate cuts to carbon emissions can avert a climate catastrophe.

    Caroline Lucas, Green Party MP for Brighton Pavilion, said donations from polluting industries represented a “dangerous conflict of interest”. 

    Fossil Fuel Ties

    Harborne is the owner of AML Global, an aviation fuel supplier operating in 1,200 locations worldwide with a distribution network that includes “main and regional oil companies”, according to its website. Harborne is also the CEO of Sheriff Global Group, which trades in private jets. 

    Before the pandemic, aviation emissions accounted for eight percent of the UK’s annual greenhouse gas emissions, according to the government’s Climate Change Committee, yet the government granted nearly £250 million in “free pollution permits” to the industry in 2021.  

    In the past, Harborne has provided gifts to Conservative MP Steve Baker, who co-founded an anti-green group of back benchers  – the Net Zero Scrutiny Group – and who has said that a considerable amount of climate science is “actually still contestable”.

    Harborne has also donated some £6.5 million to the Brexit Party – now Reform UK – whose co-founder Nigel Farage has called for a referendum on the government’s net zero targets and has labelled the focus on carbon emissions “alarmism”. Harborne has rarely spoken about the climate crisis, so the details of his personal views are unknown. 

    As revealed by DeSmog, Harborne also donated £515,000 to the Conservatives in the second quarter of 2022, when the party accepted a total of £651,000 from the aviation industry.

    These donations landed in the same period as the government’s “Jet Zero Strategy”, published in July. The policy – which aims to cut UK aviation emissions to net-zero by 2050, allow travellers to fly “guilt-free” and supports further aviation sector growth – has been dismissed by environmental groups as “pure greenwash”.

    Harborne and AML Global have been approached for comment. 

    Other Donors

    The new Electoral Commission records show that the Conservatives received a further £15,000 in the final quarter of 2022 from Centrax Industries – a firm that specialises in manufacturing gas turbines. Centrax has now given more than £300,000 to the Conservatives since 2010.

    DeSmog previously revealed that companies and individuals involved in North Sea oil and gas – including Centrax – donated a total of £419,900 to the Conservatives ahead of and during the government’s review into the future of the sector from July 2020 to March 2021.

    Another Conservative donor in the final quarter of 2022 was Nova Venture Holdings, which donated £52,260. The company is wholly owned by Jacques Tohme, who describes himself as an “energy investor” on LinkedIn and lists his current role as co-founder and director of Tailwind Energy, an oil and gas company. 

    According to its website,Tailwind focuses on “maximis[ing] value in UK continental shelf (UKCS) opportunities”, an area which includes the North Sea. Serica Energy reportedly has an agreement in place to buy Tailwind, which is expected to complete in March. The acquisition will make Serica one of the 10 largest North Sea oil and gas producers. 

    A further £10,000 was given to the Conservatives by Alan Lusty – the CEO of Adi Group – adding to the £17,000 that he has given to the party since 2021. According to its website, Adi Group is a “leading supplier of engineering services to the petrochemical industry”. These services “add significant value to petrochemical engineering companies”, Adi says, though the firm claims “to work towards delivering a low-carbon economy” through its products. Adi also provides engineering services to the aerospace and automotive industries. 

    Finally, the Conservative Party received £50,000 from one of its peers – Lord John Nash – who also donated £5,000 to the local Wantage constituency party. According to his register of interests, Lord Nash holds shares in Royal Dutch Shell, the second largest investor-owned oil and gas company in the world by revenue, and BHP, the Australian-based mining, oil and gas firm. 

    Lord Nash, who has run several private equity funds, has donated more than £560,000 to the party since 2018. 

    The £632,260 accumulated by the Tories from fossil fuel interests and high polluters represents more than 13 percent of the party’s £4.8 million income during the final quarter of 2022. 

    Rishi Sunak himself received £141,000 from energy interests during his Conservative leadership campaign in the summer of 2022. 

    Jacques Tohme, Tailwind Energy, Centrax, Adi Group, Lord Nash and the Conservative Party have been approached for comment. 

    Additional research by Clare Carlile.

    Original article by Sam Bright republished from DeSmog.