Gov. Andrew M. Cuomo, D-N.Y., recently unveiled the ninth proposal of the 2018 State of the State: a plan for divesting the New York State Common Retirement Fund from significant fossil-fuel investments. The fund, which is one of the largest public pension plans in the nation, manages over $200 billion in retirement assets for more than 1 million New Yorkers.
Specifically, according to the New York State Energy Research and Development Authority (NYSERDA), the proposal calls for ceasing all new investments in entities with significant fossil fuel-related activities. In addition, Cuomo and Thomas DiNapoli, New York State’s comptroller, will work together to create an advisory committee of financial, economic, scientific, business and workforce representatives. The committee will serve as a resource for the Common Retirement Fund to develop a de-carbonization roadmap to invest in opportunities to combat climate change and support the cleantech economy while assessing financial risks and protecting the fund.
NYSERDA says adopting this approach will send a strong message to the financial markets that major investors, including New York State, are fully and aggressively committed to a carbon-free, clean energy future. In addition, the governor has called on the fund to dedicate a meaningful portion of the fund’s portfolio to investments that directly promote clean energy.
“New York has made incredible strides in securing a clean energy future for this state with our nation-leading clean energy standard, offshore wind development and aggressive investment in the cleantech economy, yet the common fund remains heavily invested in the energy economy of the past,” says Cuomo. “Moving the common fund away from fossil-fuel investments will protect the retirement savings of New Yorkers. This proposal lays out a roadmap for New York’s $200 billion common fund to take responsible steps to divest from its fossil-fuel holdings, leading to a more secure retirement fund for countless New Yorkers while also helping to achieve the state’s clean energy goals.”
According to NYSERDA, the New York Common Fund manages approximately $200 billion in retirement assets for more than one million New Yorkers. Though the fund is intended to provide long-term financial security for its members, it remains heavily invested in fossil fuels, NYSERDA says. This year, the fund listed holdings in more than 50 oil and gas companies that have been identified as among the 100 most carbon-intensive in the world.
With billions of public-employee dollars invested in the fossil fuel industry – and nearly $1 billion invested in ExxonMobil alone – the common fund holds increasingly risky financial investments for New Yorkers, particularly as both New York State and the world back away from the use of fossil fuel as a primary energy source, according to NYSERDA.
NYSERDA notes that New York State has already taken major steps to reduce its carbon footprint and cut back on the use of fossil fuels as an energy source. This includes requiring that 50% of the state’s electricity needs come from renewable energy sources, such as wind and solar, by 2030.