Coal

Published on October 20th, 2015 | by Joshua S Hill

19

Oslo Becomes First Capital City To Divest From Fossil Fuels

October 20th, 2015 by  

Eight months after becoming the first capital city to divest from coal, Oslo has announced it intends to divest its pension fund from all fossil fuels — coal, oil, and gas.

According to Fossil Free Europe, which reported the news Monday, the City of Oslo announced that it intends to divest its $9 billion pension fund from coal, oil, and gas companies. (For those bilingual Norwegians out there, the Oslo City Council declaration is available here (PDF).)

And while Oslo isn’t the first city to announce such a divestment, it does go down as one of the biggest announcements, as it is the first capital city to fully divest from all fossil fuel investments.

“We are very happy to announce that Oslo will take responsibility for the climate, both through our own policies and our investments,” said Lan Marie Nguyen Berg, of the Green Party in Oslo.

oslo-meme

“The time for climate action is now, and the new city government will address climate change both locally and globally. The reduction in pollution will make the city even better to live in, and ensure that we take our global responsibility. Divestment sends a strong message to the world prior to the Climate Change Conference in Paris that we need a strong agreement that will ensure that we avoid dangerous global warming.”

Go Fossil Free keep an updated version of all those institutions — including cites such as the City of Christchurch in New Zealand, Fremantle and Moreland in Australia, and now Oslo in Norway, among more than 40 others — that have made such commitments. Go Fossil Free’s total figures currently have $2.6 trillion divested by 452 institutions worldwide.

Fossil Free-2

The news comes eight months after the City of Oslo announced that it would divest its $7 million investments in coal following a massive demonstration by residents as part of Global Divestment Day.

At the time, Olso’s finance commissioner, Eirik Lae Solberg, explained that the city had made the decision to divest from coal “because power generation based on coal is one of the most environmentally harmful in the energy sector,” adding that “we want to use our investments to promote more environmentally-friendly energy and a more environmentally-friendly society.”

Speaking on Monday, Ms Nguyen Berg echoed these sentiments, and further explained the rationale for fully committing from fossil fuel investments:

“This is also a sound financial decision. Heavy investments in fossil fuels is a huge risk when we know that the majority of fossil fuels must remain in the ground to avoid catastrophic climate change. The Norwegian economy is already experiencing the downsides of being dependent on fossil fuel exports, with unemployment rates rising following the drop in oil prices, and investment costs rising sharply on the Norwegian shelf. This policy change will protect our pensions from being invested in stranded assets.”

The move comes ahead of the much-anticipated UN climate negotiations set to be held in Paris next month, and will no doubt encourage many other countries to push their own capitals to follow suit.


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About the Author

I'm a Christian, a nerd, a geek, and I believe that we're pretty quickly directing planet-Earth into hell in a handbasket! I also write for Fantasy Book Review (.co.uk), and can be found writing articles for a variety of other sites. Check me out at about.me for more.



  • sjc_1

    Ironic, since Norway’s pension fund got money from North Sea oil.

  • JamesWimberley

    “The move … will no doubt encourage many other
    countries to push their own capitals to follow suit.” I suggest that has it backwards. Big-city mayors often have national ambitions, and even if they don’t, they like to be seen as leaders not followers. Capital cities don’t have coal mines and oil wells within their boundaries, and few power stations. It’s the mayors who are pushing their national governments to speed up action.

  • This is good, but let’s put this into perspective. Norway’s crude oil consumption is about 220,000 barrels per day. It’s natural gas consumptions is about 210 billion cubic feet per year. This is equal to roughly 100,000 barrels of oil equivalent per day (boed). So Norway is pretty marginal in oil and gas consumption. About 90 percent of Norway’s electricity is hydro powered.

    On the other hand there’s Statoil, Norway’s state owned oil and gas company. As of 2nd quarter 2015, Statoil oil direct owned and partnered ventures produce 593,400 barrels of oil per day and 555,400 barrels of oil equivalent per day of natural gas for a total of 1.15 million boed. That’s a lot. But there’s more. Its equity stake in fields like Alberta tar sands and Bakken shale is 553,500 and 170,400 boed for oil and gas, respectively. Totaling these two, the company produces 1,872,000 barrels of oil equivalent per day. Exxonmobil produces about 5 to 6 million barrels per day. So Statoil ain’t nothing.

    Statoil basically is responsible for Norway’s sovereign fund at $1 trillion. And that helps buoy Oslo’s economy. Ironically, Norway is a major producer at the Marcellus shale field. It’s holding is 665,000 acres. Pennsylvania doesn’t collect severance taxes on natural gas production. Those taxes would help the state do things like Norway does. Pennsylvania is broke, even with all the Marcellus gas. Philly schools are almost bankrupt. Yeah America.

    Full disclosure: I’m half Swedish. Swedes and Norwegians have had issues.

    • JamesWimberley

      Yeah. Having kings with nicknames like Bloodaxe does not suggest today’s genteel intra-Nordic spats are the historical norm.

      • I’m just jealous and bitter as an American that a country can tax appropriately natural resources exploitation to benefit its citizenry. Despite environmental problems. America seems to be going down the pathway of Nigeria. BBC radio had a segment on Nigerian oil thievery. There’s an estimated 300,000 barrels per day being stolen from pipelines and directly from the wellheads. At $50/barrel or whatever, that’s about $15 million per day. It was previously discussed that the problem was a couple barrels here and there. Of course Pennsylvania is almost a third world state right now. Coal mines still on fire after 50 years. Most mines are abandoned without being restored. A mess.

        • Matt

          If you don’t force the company to place money into a fund control by 3rd party for every once of coal mined, then restoration never happens. Oh and it isn’t just shale gas not be charged royalties. Coal has been cheating the US government for years on royalties.

          • eveee

            Yes. And the government has been lax in regulations. Unfortunately, fund have run short for bankrupt fracturing companies and someone else will have to pay.

            http://climatecrocks.com/2014/01/04/fracking-wells-abandoned-in-boombust-cycle-who-will-pay-to-cap-them/

          • Interesting link. Thanks. Wyoming has nobody to blame but themselves. Well bonding in go-go drilling states is laughable. Wyoming looks to have a 6 percent severance tax. This immediately goes to the state’s general fund and gets spent. It’s conservation tax is at 0.04%. I believe this is the set aside if the drilling walks away. At low prices there probably isn’t much money sitting in state coffers.

            Here’s all the states on how the tax oil and gas production. I can’t figure out how much gets set aside for state lead plugging and abandonment. There’s remediation as well. Which is expensive if necessary.

            http://www.ncsl.org/research/energy/state-revenues-and-the-natural-gas-boom.aspx

            Man alive, it looks like companies can drill all they want with about a $100,000 bond – for all wells. Many companies have hundreds if not thousands of wells. Idiots.

          • eveee

            Thats right. Its practically scandalous. Abandoned mines (as another example)all over the SouthWest, and no end in sight to increasing them. We are in a hole, but we keep on digging.

          • Metal mines? I had to bring that up. US is bad. China is worse. China produces half the aluminum in the world. And steel. The state just cut coal prices to reduce electricity costs for its aluminum industries. It’ll take about 2 years of reduced emissions to overcome aluminum spec’d cars and trucks life cycle carbon footprint. The only fairly clean aluminum is processed in Iceland right now. But that’s a fraction of overall production. All I ask for renewables and EVs is to take advantage of 40 years of environmental regulations. Regulations metals and fossil fuel extraction industries have blown off or got an exemption from.

          • eveee

            Aluminum in PNW is pretty clean coming from Bonneville. Hydro is usually where aluminum is because it consumes so much electricity.
            Steel is pretty universally dirty with coke manufacturing, but I heard electric methods were starting. The whole carbon steel thing, the ones we saw science movies about as kids.

            I am all for renewables having the same environmental standards. But I am not seeing it. (an exception is corn based ethanol, not too dirty, but not ideal, either) I am seeing oil companies get fined for birds that can be found, not the deaths of thousands that are unseen, while complaining about wind farms and getting them shut down. (Duke)Thats being compared unfairly against wind turbines. In fact, all I see is ridiculous, unbalanced, out of context attacks on wind that way. And solar. Like the ridiculous attacks against Ivanpah for bird deaths that are repeated long after Ivanpah found a solution and don’t compare against the thousands of bird deaths from coal and oil. And where do they come from? IER. Breitbart. Think tanks and front groups for Koch. The odious purveyors of the most filthy garbage in the world, tar sands.

            Ivor is right in this respect. Don’t put up acres of development and increase population with an appetite for resources and demand for air conditioning in the desert. Then you won’t need an Ivanpah. And IMO, its better for water to replace an existing thermal power plant with an Ivanpah.

          • This is why I like that Tesla Model 3 may use more steel (my guess is that the blog below has been vetted as spam free):

            http://cleantechnica.com/2015/07/27/new-tesla-model-3-rumors/

            New ultra light steel:

            http://www.worldautosteel.org/projects/ulsab/

            I’m all for aluminum, it’s just can be a pig as far as energy inputs. There’s still a big gap in between recycled and raw.

          • eveee

            There is a lively debate of steel vs aluminum. More GHG during manufacture, but less in use (cars). There is a study referenced in this article to that effect.

            The links seem broken.

            http://www.cartalk.com/blogs/jim-motavalli/steel-vs-aluminum-lightweight-wars-heat

          • Aluminum’s advantage during O&M gets narrower as drivers get fatter. Obesity is probably the biggest driver of GHG emissions right now. Not so much directly, but due to Americans insatiable need to use energy for a comfortable and lazy lifestyle. Hence our extremely high per capita GHG emissions. That’s probably why fat office workers want big trucks like the Ford F150 with aluminum bodies enveloping those huge crew cabs and maybe Costco groceries sitting in the bed.

          • Bob_Wallace

            Sometimes I just shake my head….

          • eveee

            Oooh. Thats a hot potato. But I do notice big people in big cars. Even in little cars if they can squeeze in.

            Take a look at the video. Warning. Bad language. Also, don’t drink any liquids while watching.

            https://www.youtube.com/watch?v=hTJZTua4Tu0

          • You’re right on third party. Environmental trusts in the US are unfunded, underfunded, raided or nonexistent. Superfund trust fund sits at $0.00 right now. Any money for oversight and cleanup comes out of the general fund. Coal and nuke are almost laughably underfunded.

        • Rick Thurman

          Just look at any map of HDI, or Human Development Indicators like poverty, education and health rates,for the US… then notice how those overlap with oil and coal producing states like Texas-Louisiana -Oklahoma -New Mexico, and West Virginia -Kentucky… it’s amazing how often money can be so efficiently sucked out of a region, leaving even less trace of its presence than the leftover pollutants associated with its production.

          • Outstanding analysis. I guess Pennsylvania didn’t pass a severance tax on natural gas:

            opinion piece from a typical anti tax rightwing local newspaper:

            “Whether the tax is 5 percent or 3.5 percent doesn’t matter. Imposing additional new taxes on natural gas production is fundamentally a mistake at any rate. The bottom line is raising production taxes would make it more costly to do business in Pennsylvania — and do that during a global energy price downturn that is already putting a strain on U.S. producers. Constricting an industry through taxation is no way to sustain a job-creating energy revolution.”

            http://www.mcall.com/opinion/mc-marcellus-shale-gas-tax-wissman-yv-20151019-story.html

            It’s not like oil and gas contractors have any other state to produce much oil and gas in the area. Pennsylvania is the epicenter of the Marcellus play. West Virginia is well in production (and gas is taxed by the way). New York state said no to drilling. However, conservatives act like if there’s a slight tax on production they’ll go elsewhere. Idiots.

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