The retirement fund for employees of the state of Colorado has over $2.1 billion invested in fossil fuel companies, according to a new report released by the environmental advocacy group Stand.earth.
The Colorado Public Employee Retirement Association (PERA) provides retirement and other benefits to employees of more than 500 government agencies and public entities across the state. Members of PERA include state and city government employees, college professors, and state troopers.
According to the report, some of PERA’s largest fossil fuel investments include almost $130 million invested in Chevron, as well as $89 and $86 million invested in Phillips 66 and Shell, respectively.
PERA also has $6.7 million invested in Suncor, the Canadian tar-mining firm that owns Colorado’s only oil and gas refinery: the Suncor refinery in Commerce City. That refinery is notorious for polluting its surrounding neighborhood and reached a $9 million settlement in a lawsuit with the state for their air and water quality violations in 2020.
Deborah McNamara is the campaign director for 350 Colorado, an environmental group advocating for fossil fuel divestment. McNamara wants to emphasize how dire a situation the climate crisis is.
“We have been calling on PERA to divest from fossil fuels for many years,” McNamara told the Colorado Times Recorder. “We think it’s the right thing to do from a moral and ethical perspective as well as from a fiduciary perspective. We are looking at this issue through the lens of potential climate catastrophe.”
The cost of climate disasters doubled in 2020 from previous years, costing $95 billion in immediate recovery.
“Thus far we feel as though PERA is not taking the issue of climate change and the financial risk associated with it very seriously,” McNamara said.
Devon Reynolds is a University of Colorado graduate student employee and a member of PERA and supports PERA divesting from fossil fuels. Reynolds said that other pension funds, like New York state and the city of San Diego, divesting from fossil fuels provides proof that divestment is feasible.
When reached for comment, a spokesperson for PERA provided the Board of Trustee’s official statement on fossil fuel divestment, which was formulated at a meeting in January 2019. The statement said the group’s main priority is reducing risk to its members and will not divest from fossil fuels unless directed by legislation passed by Colorado’s general assembly.
“The issues facing our world today are not easily separated into gradations of severity or importance,” the statement read. “Consensus as to the priority of these types of issues and the proper recourse is difficult to achieve. As a result, once a divestment mandate is imposed to address one issue, the resulting ‘slippery slope’ makes differentiation among the remaining issues contentious and divisive. Increased divestment is costly and limits PERA’s ability to effectively seek the best risk-adjusted returns to secure the retirement benefits of public servants. For these reasons, PERA will oppose divestment efforts unless such opposition is inconsistent with its fiduciary duty, but will implement divestment mandates passed by the Colorado General Assembly.”
Data has shown that adopters of the divestment movement have reported neutral or positive returns over the past decade.
A bill was proposed during Colorado’s 2021 legislative session that would have forced PERA to divest from fossil fuels. While the bill was rejected by the House Finance Committee, plans for another bill in the upcoming session are in motion, according to McNamara. McNamara is optimistic about its chances but says her work will continue until she sees meaningful change from PERA.
“We don’t understand why pension funds are continuing to uphold this status quo of fossil fuels investments when we know we need to transition away from fossil fuels,” McNamara said. “This is an opportunity for Colorado to lead on this issue. There are hundreds of pension funds making this decision right now and this is a chance for PERA to lead on this.”