Environmental Groups Call For Surrey County Council Pensions To Divest From ‘Risky’ Fossil Fuel Shares

Published on: 9 Mar, 2020
Updated on: 9 Mar, 2020

Environmental groups have sent an open letter to the Surrey Pension Fund committee at County Hall calling on them to stop investing employee and taxpayer funds in ‘catastrophic’ fossil fuel schemes (see link to the letter).

In an attempt to force them to divest an estimated £151 million of oil and gas shares, the letter pointed to evidence that oil and gas “stocks have already been underperforming”

Backed by 14 local activist groups including Friends of the Earth, Guildford Environmental Forum and Extinction Rebellion, the letter said that there was a need to shift towards renewable energy “to prevent the catastrophic destabilisation of our climate” and accused the pension fund of “financing this oncoming destruction”.

The letter cites the outgoing governor of the Bank of England, Mark Carney, speaking in December 2019 warning the financial industry that unless firms woke up to what he called the climate crisis, many of their assets would become worthless.

Unison report Responsible Investment in Local Government Pension Schemes (April 2019) said that “Climate change has been recognised as a material risk by only 29 (32%) funds.”

The call was also supported by the UK’s largest trade union, Unison, which is the largest union representing staff at Surrey Country Council.

Unison regional organiser Jenny Mason said: “Pensions are meant to safeguard our future, but that future is threatened by burning carbon in fossil fuels such as coal, oil and gas.

“Unison is a passionate advocate for pension funds to end investment in fossil fuels. Council staff contribute to their pension and it’s only right they have a say in where it’s invested.”

“Surrey Pension Fund should act now to withdraw its investment in fossil fuels and protect the ability of the system to support pension payments in the future.”

Surrey councillor, Fiona White (Lib Dem, Guildford West), said: “The pension fund committee has taken the view that they should be engaging with the fossil fuel companies that form part of our investment instead of divesting their interest. I can see a certain logic in that argument but I disagree.

“Surrey has declared a climate emergency. It is important that our actions match our words in this. It would be better to put that investment into renewable energy companies for the good of our planet and our future. After all, that seems to have been the recommendation of Surrey’s own Greener Futures Task Group.”

Other councils have changed their investment strategy. Southwark Council approved a move of £150m of its pension fund into a low-carbon saying that: “climate change and significant investments in fossil fuels present a long term financial risk to our fund.” (Cllr Fiona Colley January 2018).

The Guildford Dragon NEWS has also asked for a comment from Conservatives on Surrey County Council but no response has been received.

The Local Government Pension Scheme is administered by Surrey County Council and has established a pension fund committee with responsibility for the governance and administration of the Surrey County Council pension fund.

A spokesperson for the Surrey Pension Fund committee acknowledged the open letter and said that they will be providing a response in time for the next committee meeting on Friday, March 13.

Responses to Environmental Groups Call For Surrey County Council Pensions To Divest From ‘Risky’ Fossil Fuel Shares

Alison Moulden Reply

March 9, 2020 at 12:41 pm

Extinction Rebellion has been warning Surrey County Council of the imminent decrease in share value of fossil fuel companies for nearly a year.

Today’s news of 20% decrease in share prices for oil the proves they have been telling the truth.

Not only are the council unethically funding the climate crisis, they are also needlessly risking the pensions of hard-working county employees, who do so much for us – often out of a sense of paying into the community – with meagre financial rewards. A liveable pension is the least they can expect.

Surrey County Council, stop playing with everyone’s futures, and DIVEST FROM FOSSIL FUELS IMMEDIATELY.
- Jim Allen Reply
  
  March 9, 2020 at 7:47 pm
  
  Ethanol is a ‘fossil fuel’ condensed from volcanoes in Iceland and is used in internal combustion engines leaving little or no ‘dangerous’ chemicals in the air
  
  We have to beware of jumping too quickly into this political group ‘Extinction Rebellion’ who wish in their manifesto to overturn the current democratic process for a “who shouts loudest and causes most disruption has the upper hand” political manifesto.
  
  Electric cars will still need electrical generation (HOW?) and the world’s production of lithium and copper to make sufficient batteries for the UK to go all electric in the allotted time frame.
  
  We are back to the political question placed to the engineer who responds “yes we can do that but do you actually want the end result?”
  - Alison Moulden Reply
    
    March 10, 2020 at 1:29 pm
    
    Jim – thank you for your response to my comment. Ethanol is carbon based, and if it is burned, it may leave no toxic residue, but it will certainly emit carbon into the atmosphere, which is what is driving the devastating climate effects we have seen around the world, such as the billion animals burning to death in Australia.
    
    Renewable energies leave no toxic residue, and neither do they cause climate change, so yes, we do want those…
    - John Perkins Reply
      
      March 10, 2020 at 3:12 pm
      
      That news article suggests the fall this week in oil company share prices is due to a dispute between Russia and Saudi Arabia about the latter’s response to Coronavirus.
      
      It doesn’t seem to me to make much sense to accuse the council of “financing this oncoming destruction” by losing money on some of its investments because it failed to foresee the panic.
Anne Notley Reply

March 9, 2020 at 1:30 pm

Surrey County Council has been warned and advised by those far more knowledgeable. Yet they still seemingly disregard not only the science behind global warming but fiscal advice from top economists.

I suggest they are being not just ignorant but irresponsible with the economic and future lives of those people they are meant to protect.
Julia Shaw Reply

March 9, 2020 at 8:11 pm

Surrey County Council, please stop funding the climate crisis.
John Perkins Reply

March 10, 2020 at 9:19 am

Virtually all the wealth enjoyed by those who claim fossil fuel schemes are “catastrophic” has come from the use of those fuels.

Mark Carney the banker has form predicting dire economic outcomes which prove false.

The wholesale price of oil dropped because Saudi Arabia increased production, whilst, according to one site, the three fastest rising UK share prices today belong to Lekoil, Petrotal and Savannah Petrol. So where does the “20% decrease” come from? Perhaps Alison is referring to the drop in share indices due to the Coronavirus scare, though that wasn’t limited to oil.

I sometimes wonder why we bother to elect politicians when there are so many far more knowledgeable people out there.
- Alison Moulden Reply
  
  March 10, 2020 at 1:34 pm
  
  Oil dropped more than any other sector….
  
  “On Monday, the price of international oil benchmark Brent fell almost a third in its biggest drop since the Gulf War in 1991 before recovering slightly to trade 20% lower.”
  
  https://www.bbc.co.uk/news/business-51796806
Phil Mitchell Reply

March 10, 2020 at 9:20 am

Divesting from fossil fuels is something we should all do. Look at Ethical Consumer to find more ethical and fossil Fuel free banks, pensions and other investments. Continuing to fund fossil fuel exploration and extraction continues to prolong the problem.

Instead Surrey CC should look to invest in renewables, hydrogen technology, insulation and other technologies that will reduce our reliance on fossil fuels and the carbon economy. It would be great to have volcanic ethanol in UK, but we need to look to realistic technology for the UK. Tidal and wave are key as is wind. Also non lithium and cobalt battery tech. Though more of those in phones and computers than electric cars so please don’t use that argument.
- Jim Allen Reply
  
  March 10, 2020 at 3:57 pm
  
  The lithium battery is the main source of electric batteries in cars, so I understand and if we are to have all electric cars by a selected date, the balance between phone and car will soon change.
  
  Talking, expecting others to act and practising are two different animals.
  
  I wonder if we held a survey of commentators demanding action just how many homes they live in have a heat recycling ventilation system, solar hot water, solar electric 240volt and 12 volt, a wind generator and 5,000 litres of rain water recycling.
  
  My guess is only one!.
  
  Guess who!
- Harry Eve Reply
  
  March 10, 2020 at 8:43 pm
  
  How about buses with ultracapacitors (fast charge/fast discharge) that charge from an overhead point at bus stops while the passengers move on and off the bus?
  
  Is there any reason why these do not seem to be appearing in the UK yet ? Are there any drawbacks from using ultracapacitors apart from limited range?
Guy Sutlieff Reply

March 16, 2020 at 1:30 pm

I would suggest that Surrey County Council’s Pension Fund should only have one interest and that is maximising its return for its pensioners.

Frankly in this time of pandemics and potential economic collapse, I would suggest that people might have more important things to worry about than SCC investing in long tail stable stocks like big oil firms.

Just because some people have issues at the moment with energy firms, doesn’t mean that SCC has to pander to them and sell investments at the bottom of a market.