New York City Leads Anti-Carbon Coalition of Big Funds

Institutional group wants the top 20 public power companies to make good on Paris Agreement goals.

New York City Comptroller Scott Stringer has begun a new institutional investor rally aimed at the top 20 power generators.

The endeavor, known as the Climate Majority Project, is made up of organizations such as the New York City funds and the California Public Employees Retirement System (CalPERS) that manage a collective $1.8 trillion in global assets. The group wants the 20 largest publicly traded utility companies to eliminate their carbon pollutants by 2050.

Stringer’s office says doing so would wipe out almost half of the power sector’s carbon emissions, repositioning the US for a more sustainable power grid and economy. The idea is to keep the country inline with the Paris Agreement despite the Trump administration’s withdrawal from the pact.

“We believe that every utility can and should commit to achieving the goals of the Paris Agreement of limiting warming to well below 2 degrees by setting a clear target of net-zero carbon emissions for electricity by 2050 at the latest,” the group said in an accompanying statement.

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“The climate crisis is an imminent threat not only to our planet, but to pensions systems, and ultimately, our beneficiaries,” Stringer said. “Delaying climate action is like denying climate change—it’s not an option for these companies or for anyone else.”

Stringer added that the decarbonization move is a “financial necessity” for the mega-powers.

“This initiative makes clear that mobilizing for the planet goes hand-in-hand with protecting our pensions, and we need these commitments now,” he said.

The comptroller has signed on behalf of three of New York City’s five pension funds (Employees’ Retirement System, Teachers Retirement System and the  Board of Education Retirement System), which had a combined $193.73 billion in assets under management as of November 2018. Other signees of the coalition include CalPERS ($355.2 billion), the Connecticut Retirement Plans and Trust Funds ($34 billion), Trillium Asset Management ($2.5 billion), and the Connecticut and Illinois state treasurers.

The group also wants the utilities companies to implement board oversight in their carbon reductions and be more transparent in their progress reporting.

Of the 20 utility businesses, Xcel Energy is the only one with commitments to a net-zero target.

The project has backed up its statements in a 20-page report titled “Net-Zero by 2050.”

“Electricity decarbonization delivers double benefit, both by eliminating the sector’s own substantial emissions and by unlocking the benefits of electrifying other sectors, such as transportation,” said the report. “Failure to decarbonize poses material risks for electric utility investors.”

The risks include extreme weather events, increased pollution-related health issues, and biodiversity problems.

The group said in an accompanying statement: “As investors, we are responsible for broad portfolios that are already seeing the early stages of the expected negative impacts and ongoing economic costs of climate change, including the impact of extreme weather events on property and agricultural/fisheries yields, rising pollution-related health care costs, and lost worker productivity.”

The unit also noted that Stanford University researchers have estimated more than $20 trillion in damage could be stopped by the end of the century if global warming were cut back to 1.5 degrees Celsius instead of 2 degrees Celsius.

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