New York City to Sue Energy Majors, Divest from Fossil Fuels

New York City mayor Bill de Blasio, comptroller Scott Stringer, and other trustees of the city’s $189-billion pension funds laid out a goal Jan. 10 to divest from fossil fuel investments within five years. The mayor also said the city has filed a lawsuit against the five largest investor-owned fossil fuel companies “as measured by their contributions to global warming.” The city is seeking damages from BP, Chevron, ConocoPhillips, ExxonMobil, and Royal Dutch Shell “for the billions of dollars the city will spend to protect New Yorkers from the effects of climate change.”

The compensation sought is for damages alleged to have already caused harm and to address additional harm expected over the course of this century. “New York City’s lawsuit seeks to recover the billions needed to fund climate change resiliency measures that the city needs to implement to protect the city, its property, and its residents from the ongoing and increasingly severe impacts of climate change,” said a statement released by the mayor’s press office. “This includes physical infrastructure like coastal protections, upgraded water and sewer infrastructure, and heat mitigation, but also public health campaigns, for example, to help protect residents from the effects of extreme heat.”

“New York is standing up for future generations by becoming the first major U.S. city to divest our pension funds from fossil fuels,” said de Blasio. “At the same time, we’re bringing the fight against climate change straight to the fossil fuel companies that knew about its effects and intentionally misled the public to protect their profits. As

climate change continues to worsen, it’s up to the fossil fuel companies whose greed put us in this position to shoulder the cost of making New York safer and more resilient.”

Trustees of the city’s pension funds have ordered an analysis of the proposed divestment to determine impacts on the risk and return characteristics of the portfolio. The trustees will also seek a legal opinion as to whether carrying out the divestment would be consistent with trustees’ fiduciary duties to beneficiaries. Assuming a positive legal opinion, trustees would then instruct the city’s Bureau of Asset Management to carry out the divestment with specified steps and timelines. Transactions would

likely be carried out in stages in order to reduce transaction and implementation costs.

“Today Mayor de Blasio turned his back on millions of first responders, police officers, firefighters, and other public employees who depend on their pensions to provide for themselves and their families in retirement,” asserted Karen Moreau, the American Petroleum Institute’s New York executive director. “Government pension managers have a responsibility by law to seek the greatest return for their investors, and pensions that invest in oil and natural gas companies have historically delivered a higher return than other investments.

“Deliberately hurting pension holders, like the fine men and women who keep our city safe, is a disgraceful way to score cheap political points. Elected officials should never use taxpayer resources to hijack public pensions to advance a wrong-headed political ideology. Further, our industry has led the way in reducing U.S. carbon emissions to their lowest levels in nearly 25 years due to the increased use of clean and abundant natural gas to deliver reliable electricity.”

(SOURCE: The Weekly Propane Newsletter, January 22, 2018. PHOTO:

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