City of San Francisco Still Invests Hundreds of Millions in Fossil Fuel Companies
By William Barton
On August 9th, the board of the SFERS (San Francisco Employee Retirement System) had resolved itself to a big vote. They were deciding whether to fully divest from fossil fuel companies in a landmark case for the growing DivestInvest movement for action on climate change. The SFERS board decided they’d vote two years ago and postponed. They pushed the vote to April 2017 and postponed. Then June, then July, and then to this August. For the vote this Wednesday two board members didn’t show up and the vote was postponed yet again, leaving the fate of the $475 million dollars of fossil fuel investments in uncertain hands.
Had the SF pension fund voted, it would not have been the first retirement system to elect for fossil fuel free investments. The cities of Santa Monica, Ithaca, and even Washington DC have divested their pensions from fossil fuels, along with several other cities making pledges to take up the issue at future meetings.
The call to divest funds from fossil fuels comes from the growing DivestInvest movement, which began among student groups calling on their universities to eliminate the revenues they accrue from their investments in fossil fuel companies and invest that money in companies and funds that support renewable energy. According to their own numbers, the DivestInvest movement has doubled over the past 15 months with the value of assets held by divesting institutions and individuals now exceeding $5 trillion.
Though San Francisco hasn’t fully divested its pension funds from fossil fuels, they have made votes to reallocate their funds to more renewable energy sources. The San Francisco Pension fund is valued at $21 billion with $475 million being actively invested in fossil fuel companies. If SFERS eventually commits to divestment, it will be the largest pension in the country to do so.
San Francisco’s History with Climate Change Policy
San Francisco has long touted itself as one of the greenest cities in the country and devoted to leading the nation in climate change policies. San Francisco, along with the cities of Seattle, Ithaca, Santa Monica, and Davis, has adopted considerable policies that address climate change in meaningful ways. The SFERS divestment is only one, albeit major, of the deals in which the City is looking to extract itself from fossil fuels.
SF currently leases 800 acres of city owned land in Kern County to Chevron for oil drilling, though in November of last year, the SF board of supervisors unanimously voted to end this arrangement when the Chevron lease is up in 2020. This is a good thing, though the board only took the issue to vote after it was revealed that the City was profiting from the very companies they claimed were destroying the planet.
One of the most promising signs of change in climate change policy is coming from where you’d expect it: the public. Back in 2004, SF made a commitment to transition to 100% renewable energy by 2030, and the City has been doing remarkably well on that front. All citizens of San Francisco are eligible for Clean Power SF (through PG&E), a publicly owned energy producer that provides a mix of at least 50% renewable energy for your home at the same (or lower) cost. Residents can also opt for 100% renewables for a nominal fee. This energy model is built off of the same concept used in Marin and San Mateo counties.
What’s good about Clean Power SF is that it breaks up the vertical monopoly that PG&E has on energy in San Francisco by offering an alternative to PG&E’s methods of extracting energy, and it is publicly owned, so residents of San Francisco can make suggestions and push for more renewable energy at a lower cost. (What we really need is to eliminate PG&E altogether and have a publicly owned energy provider, but that’s a discussion for a different day.)
The Paris Agreement, and San Francisco’s chance to lead the nation
With Trump taking the US out of the Paris Agreement, cities and states have found a sense of power, with California, in general, being one of the most outspoken states against the decision, and San Francisco committing itself to the agreement.
While the Paris Agreement was non-binding, meaning that the US technically didn’t have to do anything at all to curb its emissions, it did send a message to investors that fossil fuel companies may be in danger of what they call “stranded assets”– essentially oil or coal that would become illegal to extract.
A yes vote for the SFERS pension fund would send a loud (and cash-filled) message that despite a floundering federal government, state and city governments, with pressure from the public, will continue to make the changes necessary to combat climate change.
San Francisco has talked a lot about being committed to “green” energy. If our pension board members could get their act together and make it to the meetings, then now would be a good time to show that act of commitment.
Public pressure thus far has brought the board to a forced “yes” or “no” vote. The board will have to reschedule this vote (and we will cross our fingers that the seven people on the board can clear their calendars), and when they do, it’s important that the citizens of SF show their support for City Divestment from fossil fuels.
To check in when the postponed vote will occur, you can keep an eye on the SFERS website, OR, even better, follow Fossil Free SF, Fossil Free CA, 350 SF, or Defund DAPL: all great activist organizations devoted to keeping the public safe from overreaching corporations.