The head of a global philanthropic foundation says that the world turning away from fossil fuels is a critical moment in human history, akin to the abolition of slavery.
Ellen Dorsey, executive director of the US-based Wallace Global Fund, told a packed conference in Oxford, UK, this week: “We are right in the middle of a transition − not to try to curb the burning of the fuels, but to end the fossil fuel industry altogether. The industry will be one for the history books, much like slavery”
The conference, organised by the Divest Invest movement, was held to assess progress in convincing the financial sector that it will lose its money if it continues to invest in fossil fuels.
The movement involves 500 organisations − with a combined wealth of more than $3.4 trillion − that have already pledged to divest from fossil fuels and invest in climate solutions.
Sarah Butler-Sloss, founder director of the Ashden Trust, a leader in the field of green energy and sustainable development, opened the conference and stressed: “We are not making a sacrifice. We have gained money from not investing in fossil fuels.”
The conference was told that charities, trusts and banks that invested in renewables were getting a much higher return on their money than if they kept it in fossil fuels companies, so removing it was not an act of altruism but a sound business decision.
Dorsey said: “The movement has exploded, and those who have committed their finances stand to prosper while coal and oil have tanked. Those who get out will protect their money.”
She said that while fossil fuel company executives had “changed their rhetoric” since the UN climate conference in Paris last December and accepted that climate change was a problem, their actions remained the same − carrying on business as usual, trying to expand the use of fossil fuels, and pushing the planet towards heating up by 3°C to 4°C.
The biggest battle for the movement is to change the minds of the investment bankers who are continuing to put their money into coal-powered plants, mines and other fossil fuel developments. This could not be allowed to happen if the world was to keep below the internationally-agreed 2°C danger threshold, Dorsey said. “It is a financial, ethical and moral imperative that we stop this investment.”
Dorsey, who has a background in the human rights movement, said that one of the issues that must be given priority is to provide electricity for the 1.2 billion people in the world without it. “Energy poverty is a moral issue,” she said.
People in the fossil fuel industry claim that they are the only ones who can do this, she said, but renewables can do it faster and must do it in the next 15 years.
The conference discussed the main barriers to getting backers and investment funds to shift up to $100 trillion out of fossil fuels.
One of the problems is that bankers look at the returns for the last 20 years to make investment decisions for the future. On this basis, they regard renewables as high risk because there are only five years of favourable data.
One of the avenues to explore to get more divestment decisions is through the courts. For example, charities who see their job as maximising the return on their investments might be failing in their overriding duty if their main purpose is in environment, health, or poverty alleviation.
“They must realise that the mission must come before the need to make money,” said Sian Ferguson, trust executive at the Sainsbury Family CharitableTrusts.
One of the issues to address is the Divest Invest movement’s attitude towards fossil fuel companies and their executives, and whether these should be characterised as “evil” or merely misguided.
The problem for these company executives, it was suggested, is that it is hard for them to accept that their life’s work is damaging the planet and endangering the human race.
Mark Campanale, founder and director of the Carbon Tracker Initiative, which has demonstrated that most fossil fuel reserves must be left in the ground if the planet is to escape dangerous overheating, said that most of the “assets” of fossil fuel companies could not be extracted at a profit unless the oil price rose above $50 to $60 dollars a barrel.
He said that large parts of the reserves should not be counted as assets because they could never be extracted.