The Maine Public Broadcasting Network
Listen Live
Classical 24
Search
Divesting From Fossil Fuels: Movement Pushed in Maine
01/09/2014   Reported By: Susan Sharon

Nine colleges and universities have done it. Twenty-two cities, including Cambridge, Mass, Santa Fe and Seattle, have have done it. Faith-based institutions, foundations - they've all divested from fossil fuels. And now, the Maine Public Employees Retirement System, known as MainePERS, is being asked to join them. Susan Sharon has more.

Related Media
Calls for Fossil Fuel Divestment Grow in Maine Listen
 Duration:
3:24

MainePERS currently holds millions of dollars in fossil fuel interests, including $155 million in Exxon Mobil and Chevron. But if Rep. Brian Jones, of Freedom, gets his way, investments in the top 200 oil companies would be gradually phased out over the next five years.

These companies have been identified as controlling the vast majority of the world's carbon reserves. They make up between three-to-five percent of MainePERS' investment portfolio.

Still, Rep. Jones, who is a retired educator fully vested in the system himself, is aware that his proposal will cause some anxiety. "Obviously when you're talking about a pension fund, people are, by necessity, cautious."

But Jones says there are compelling reasons to take action. He says the effects of climate change are already being seen in Maine: the changing composition of the forest, invasive insects, threats to the ski industry and the lobster fishery. He says divesting in fossil fuels is the morally correct thing to do.

And it's not as financially risky to divest as one might think, says Stephanie Leighton, a senior vice president and portfolio manager at Boston-based Trilliam Asset Management. Leighton says several studies back that up.

"Basically they include that these portfolios are no riskier in terms of volatility, and many of the studies actually show you do better without fossil fuels," Leighton says. "The traditional fossil fuel industry really is a dinosaur industry. It's a commodity business. Portfolios can be built with other commodities in them besides fossil fuels."

Leighton says interest in fossil fuel-free investing has exploded in recent years, and now represents the fastest growing segment of Trillium's business - or about 20 percent of the firm's $1.3 billion in client assets under management. She says Maine's legislation, which calls for a five-year transition, should not cause any noticeable effects on beneficiaries.

"As a recently retired elementary school teacher with 30 years of experience, I'm asking the Maine State Retirement System to divest from all fossil fuels," said David Smith of Belfast.

Speaking at a State House news conference sponsored by the group, 350 Maine, Smith said he thinks about his two grandchildren and his former elementary students with his call for fossil fuel-free divestment.

"The extraction, transportation and, finally, the burning of fossil fuels is warming our planet at an alarming rate," he said. "Divestment from fossil fuels sends a clear message: that we care about our children's future."

Not so fast, says Dr. Carla Dickstein, senior vice president of Coastal Enterprises, Inc. in Wiscasset. CEI is a community development financial institution that examines financial, social and environmental returns in investing. Dickstein says CEI agrees that urgent attention should be paid to climate change. But she says the bill under consideration has not had enough time to be thoroughly vetted.

"We asked the committee to look carefully at the implications of the policy on divestment," she said. "A task force with multiple interests and expertise represented could provide the committee with a comprehensive and far-sighted assessment."

CEI and MainePERS are opposed to the bill, which received support from dozens of people at a lengthy public hearing Thursday afternoon. MainePERS says a retirement system has different financial considerations than a college, university of other institution.



ReturnReturn!



Become a Fan of the NEW MPBNNews Facebook page. Get news, updates and unique content to share and discuss:

Recommended by our audience on Facebook:
Copyright © 2014 Maine Public Broadcasting Network. All rights reserved.