Report: Oregon has invested $5.3 billion in fossil fuel companies

Cargo ships are seen anchored off the coast, sharing space with oil platforms, before arriving at the Los Angeles-Long Beach port on October 5, 2021. Environmental groups claimed in a report released Wednesday, April 20, 2022, that the Oregon State Treasury has at least $5.3 billion invested in fossil fuel companies, accusing the state of contributing to global warming and urging divestment. Image Credit: AP

The Oregon State Treasury has at least $5.3 billion invested in fossil fuel companies, according to a report released Wednesday by a coalition of environmental groups that blamed the state for contributing to global warming and urged divestment.

Oregon is regarded as a "green" state due to its goal of reducing greenhouse gas emissions by state agencies and being the first state to commit to ending the use of coal-fired power. However, the state treasury is working against itself, with over $1 billion invested in the coal industry alone, according to Divest Oregon's report.

The investments "expose Oregonians to climate and health risks, economic costs, and financial losses," according to the group.

Oregon has most likely invested far more than $5.3 billion in oil, gas, and coal companies, whose products contribute significantly to global warming. This is because the figures obtained by Divest Oregon through a public records request from the state treasury do not include private equity investments, which are not subject to public disclosure.

Treasury spokeswoman Amy Bates said the department welcomes "continued dialogue with Oregonians on the best ways to address the risks of climate change while ensuring that we meet our mandate to produce sustainable returns for beneficiaries."

"We're committed to a portfolio that reflects the realities of a changing climate and a changing policy environment," Bates said, "while earning money for the retirement security of tens of thousands of Oregonians."

Tobias Read, the state treasurer of Oregon, is running for governor on the Democratic ticket in November. Combating climate change is one of his platforms.

In a recent campaign statement, he said, "As governor, I will lead the effort to decarbonize our economy and avert the worst of this crisis." "I will instill a renewed sense of urgency in the construction of a clean energy economy and critical infrastructure to meet the challenges we face."

However, Tobias' agency, which manages $140 billion of the state's investment portfolio, including the state employee's pension fund, is overly invested in fossil fuels and should divest and put more money into green energy, according to Divest Oregon.

According to the report, investments in fossil fuels perform worse than investments in non-fossil fuel alternatives.

The report's findings on fossil fuel sector investments are far higher than the $1.8 billion reported in a previous study released in December. The Climate Safe Pensions Network's report stated that its findings were based only on partial data released by the Treasury "due to delays in disclosure by the pension fund," and that the actual amount was likely much higher.

The Oregon House of Representatives passed a bill in March that would have increased transparency in the state treasury's investments. When the short legislative session ended, it died in the Senate without receiving a floor vote.

One of the bill's sponsors Sen. Jeff Golden has stated that if he is re-elected this year he will try again in the 2023 session.

"If I'm back in Salem for the next session," Golden said, "I'll work to advance the divestment discussion." "Full public disclosure of investments made possible with public funds appears to be the very least we should all expect."

The burning of fossil fuels such as coal and gas emits gases that are a major contributor to global warming and climate change. Oregon has been hit hard by climate change, with a record-breaking heatwave last summer that killed more than 100 people, a severe drought affecting much of the state, and wildfires that are worsening.

"Oregon has a green economy based on renewable energy, agriculture, and a long history of protecting our natural spaces," environmental groups wrote in the new report. "Building on this legacy and moving the country forward necessitates bold leadership from every governmental agency, including, crucially, divestment by the Oregon State Treasury."

In the meantime, more states are considering divesting.

New York State Comptroller Thomas DiNapoli announced on Feb. 9 that the State Common Retirement Fund will limit investments in 21 shale oil and gas companies that have failed to demonstrate that they are ready for the decarbonization economy.

"We must align our investments with a profitable and dynamic future as market forces and new policies drive the energy transition," DiNapoli said. "The shale oil and gas industry will face numerous challenges in the future that will jeopardize its financial performance."

According to DiNapoli's office, the oil and gas industry, including shale oil and gas companies, "may be the most affected by climate change and the transition to the emerging net-zero economy."

During this session, Maryland lawmakers passed a bill requiring the State Retirement and Pension System's fiduciary to consider the potential systemic risks of climate change's impact on the system's assets.

While Maryland Gov. Larry Hogan decided not to veto the bill, he still has "serious concerns about politicians interfering with the Maryland State Retirement and Pension System's fiduciary duties." While the legislation is "well-intentioned," he writes that it "creates a slippery slope; rather than micromanaging, elected officials should allow our investment experts and professionals to do what they do best."

Divest Oregon is a grassroots coalition of individuals and organizations representing unions, racial and climate justice organizations, youth leaders, and faith communities across the state.

Stand. Earth, 350.org, the Private Equity Stakeholder Project, Environment Oregon, Oregon Physicians for Social Responsibility, and the Private Equity Stakeholder Project collaborated on the report.

--------------------------------------------------------------------------------------------------------------------------------

Source: Brian Witte of the Associated Press contributed to this story from Annapolis, Maryland.