Clean Power

Published on February 29th, 2016 | by Joshua S Hill


New York State Pension Funds Lost $5.3 Billion From Fossil Fuel Holdings Over 3 Years

February 29th, 2016 by  

The New York State Common Retirement Fund lost at least $5.3 billion over the last three years by remaining invested in fossil fuel holdings.

Coal smokestack via ShutterstockThese are the findings according to a new report from Corporate Knights, an investment research company, and publicised by grassroots global climate campaign Specifically, the report concluded that the New York State Common Retirement Fund (NYS-CRF) joined several other US state-based pension funds in losing billions by remaining invested in the top 200 coal, oil, and gas companies over the past three years. According to Corporate Knights, by remaining invested in over 30 companies from the top 200 dirtiest fossil fuel companies, instead of reinvesting in green companies, the NYS-CRF lost out on $5.3 billion.

“The era of fossil fuels is coming to an end, and this report demonstrates very clearly why divestment is not only environmentally sound, but financially responsible,” said New York State Senator Liz Krueger, co-sponsor of the Fossil Fuel Divestment Act. “By staying invested in fossil fuels over the last three years our state pension fund missed out on over $5 billion in potential returns. Investment in fossil fuels is a sinking ship, and it’s high time we headed for the lifeboats.” put that figure into a frightening example: $5.3 billion represents what could have been $4,500 back into the pockets of each of the Fund’s 1.1 million members.

“Our analysis with the Decarbonizer suggests the New York State Common Retirement Fund’s equity portfolio would have been at least $5.3 billion better off had it divested from the biggest oil, gas and coal companies three years ago in favour of companies providing climate solutions,” said Toby Heaps, CEO of Corporate Knights. “This number is a conservative estimate based on the equities side of the fund. The energy transition away from old fossil fuel energy to new clean energy is underway and investors who cling to fossil fuel holdings risk substantial value destruction over the long-term.”

“New York is a rich state, but perhaps not so rich it can afford to waste billions investing in failing business models–especially when the warming caused by those companies will cost a fortune to deal with!,” said Bill McKibben, Co-Founder of “New York has made bold moves for climate such as banning fracking and phasing out coal-fired power plants, yet the pension fund continues to invest in both of these destructive and outdated extraction practices.”

The New York State Common Retirement Fund joins a growing list of pension funds which have been focused in similar reports — including one in their own backyard.

Only last month, an analysis of publicly disclosed material conducted by investment adviser Advisor Pratners, on behalf of, discovered that the Teacher’s Retirement System of New York lost approximately $135 million due to remaining invested in oil and gas companies in fiscal-year 2015 alone. In fact, the Teacher’s fund saw a decline of more than 25% in its oil and gas stocks during the fiscal-year, thanks primarily to declines in Exxon Mobil and Chevon Corp, which represented a loss of more than $39 million on their own.

Joining New York was California’s two public pension funds — California Public Employees’ Retirement System (CalPERS) and California State Teachers’ Retirement System (CalSTRS) — which were found in August of 2015 to have lost more than $5 billion over the previous year due to their investments in the top 200 fossil fuel companies.

“This is a material loss of money, which directly impacts the strength of the pension fund,” said Matthew Patsky, CEO of Trillium Asset Management, the agency who conducted the analysis. “Fossil fuel stocks are volatile investments. Investors and fiduciaries should take this moment to reassess their financial involvement in carbon pollution, climate disruption and the financial risk fossil fuels plays in their portfolio.”

Across the Pond, figures published in October of 2015 suggested UK local council pension funds had lost up to £683 million (or around $1.05 billion USD) due to their own failed investments in coal. According to new calculations by Platform London, and released in conjunction with, Friends of the Earth, and Community Reinvest, failed investments in coal firms caused by the recent coal crash cost UK local council pension funds up to £683 million, with Greater Manchester’s interests in coal crashing by £148 million.

Despite the losses being incurred by so many, fossil fuel divestment numbers and commitments continue to increase. Early December, published its most recent tally of fossil fuel divestments, revealing that more than 500 institutions from around the globe have committed to divest from fossil fuels, totalling over $3.4 trillion. That was a tremendous growth rate from only September, which had seen 430 institutions committing to divest $2.6 trillion.

“The logic of the divestment movement is quite simple: if it’s wrong to cause climate change, it’s wrong to profit from climate change,” said Executive Director May Boeve. “The diversity of actors involved, such as faith groups, cities, universities show that the movement is wide and has injected itself into the life of different institutions which do not want to be associated with this industry.”

Image: Coal smokestack via Shutterstock

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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 (, and can be found writing articles for a variety of other sites. Check me out at for more.

  • solarpete

    Great article Joshua. When you look at the numbers the fact that coal stocks were down an average of 75% and Oil stocks were down an average of 67% is bad enough. But the S&P 500 was up during that same period ( 2013-2015) UP 43%. This is not just a poor job of money management, but without question a performance that merits dismissal of responsible money managers !!!!!

    • Matt

      Want to bet that in 2014 they were talking buy opportunities in coal/oil/gas. Many are still saying the same on oil/gas now.

      • solarpete

        Sure. I am sure they were – trying to guess in a downtrend when a stock will turn. That is otherwise known as incompetence or catching falling knives – bot bad and not wise

  • Mike333

    India has essentially peaked with coal. No new coal plants will be built because Solar is already at price parity.
    Coal is actually dead globally.
    Those companies, however, have not yet gone bankrupt.

    SPYX now.

    • neroden

      Unfortunately, I don’t like the massive exposure to financial stocks, which have a tendency to blow up and disappear overnight. I’ve been looking for an index which excludes both fossil-fuel stocks *and* banks… some sort of “manufacturing & services” index….

      • Mike333

        SPYX is there for you to get out of carbon.
        It’s a secret performance index. It doesn’t drop as far as SPY but it doesn’t also have those big recovery jumps. Far more stable, representing real value.
        And you won’t take the hit on 100’s of coal companies going bankrupt.

        Getting out of banks with an index will be hard.

        • neroden

          Well, I don’t usually do indexes; my family are long-time individual-stock investors. More research required, and *much* more volatility, but it means if I want to *not* be exposed to something, I can definitely not be exposed to it.

          (We’re in a couple of sectoral indexes where I’m not bothered by anything in the sector.)

    • Deep Time

      Coal companies are little more than zombies now, shambling on until someone shoots them in the head.

      I read that while China continues to build an average of a new coal plant per week the utilization of the plants is low. China is finally trying to cancel planned plants as they don’t make economic sense. They will certainly end up with a pretty significant overhang of plants operating at a fraction of their capacity.

      The coal story will be repeated by oil and, eventually, natural gas. Yet these industries seem to have a blind spot.

  • Mark Turner

    Headline amount needs an edit

    • Jim Young


      “Big pension funds suffer lost potential oil investment profits, can they sue for $10.3 Billion like transnational corporations under pre-TPP – ISDS rules are already trying to sue $15 Billion lost potential for Keystone?”

      All we would ask for is a measly $5.3 Billion for NY Pension funds 3 year losses and $5 Billion for California’s CalPERS and CalSTERS 1 year loss

      “New York State Pension Funds Lost $3.5 Billion From Fossil Fuel Holdings Over 3 Years” should have at least been $5.3 Billion, the rest came from the following:

      “…California Public Employees’ Retirement System (CalPERS) and California
      State Teachers’ Retirement System (CalSTRS) — which were found in August
      of 2015 to have lost more than $5 billion over the previous year due to
      their investments in the top 200 fossil fuel companies…”

  • JamesWimberley

    “Despite” the losses? It was partly because of the losses.

  • wattleberry

    The transposition error in the headline needs correcting.

  • Frank

    I think oil and gas was mostly an overshoot problem, at least at the moment. I think coal is in teminal decline. I think oil is vulnerable to EVs, but not hurt by them yet. Gas is still growing, but if their prices go up, renewables will hurt them eventually.

    • neroden

      Oil’s a terribly bad investment. It’s already price-uncompetitive for heating, and people are finally ripping out their oil heaters. Every industry which can replace oil feedstocks with natural gas is doing so. And EVs are enjoying exponential growth curves, which will kill the gasoline demand within about 20 years. The lubricants demand for oil isn’t large enough to prop the market up, and the airplane demand isn’t large enough either.

      The oil market will continue to exist for those two niches, but it’ll shrink so much that all the oil companies are god-awful investments until after it’s shrunk.

      Natural gas will last longer, but it’s still a bad investment. Biogas is readily available as a substitute.

      • Frank EV’s up 8%. Tesla up a bunch, but expensive. Leaf down a bunch, but still #2. They just aren’t strong enough yet. Now if Tesla gets cramped in Freemont, and some serious competition shows up, and frankly, people go from “what is that thing” to “oh, you got an EV” then we have something. Maybe in 2 or 3 years?

        As to bio gas, which I don’t know much about, besides it can be made with an anaerobic digester, which it’s a really good way to process a lot of fecal matter. How much can be made(how scaleable), and at what cost?

        • neroden

          The cheapest biogas comes straight out of landfills already. There’s concerns about “purification” so most of it is used to make electricity, or flared, or just vented, right now. But it wouldn’t be super-difficult to change that.

          Exponential growth is the thing with electric cars, as it is with solar. It looks tiny now, but it’s growing so fast that reasonable projections have electric cars as a majority of the market sometime in the 2030s. That’s really… not a very long life for oil companies, is it? 20 years and dead? Are any of them prepared for that? I think the P/E ratios are all way too high to account for that.

      • Mike333

        True about oil heating. Even the most efficient oil boilers only modestly deliver on fuel and cost savings.

        Double your home insulation and triple pane windows have a much higher payoff.

        Then switch out to a modern heat-pump. The efficiency and reliability of heat-pumps have increased far more than oil boiler efficiency.

      • just_jim

        Oil is a bad investment, but it needn’t be. We’re going to need oil and oil products at somewhat close to current amounts for the next couple decades even if renewables and EVs go at the pace we want.

        The reason that oil is a bad investment is that the majors continue to explore and develop as if oil use is going to increase as it has in the past. If we are to have a hospitable planet, none of the oil that they find can be used. Their exploration money is wasted and could be better returned to the stockholders as dividends, or used to locate and develop geothermal sites.

        An oil company that made those changes could be a good investment, but I’m not holding my breath.

        • neroden

          An oil company which completely halted all exploration and just treated its old wells as cash cows could be a good investment. But I can’t think of a single one. They don’t want to believe that their business is dying.

    • Deep Time

      Agree. This is probably mostly due to the recent collapse in oil prices arising from oversupply and slack demand. U.S. fracking was the primary driver of this, although Iran’s recent re-entry to the market – and Saudi Arabia keeping the spigots wide open – certainly come into play.

      Certainly coal investments are toxic, not sure how much of the loss was attributed to that.

      I don’t think the divestment movement has had a significant impact yet, but if it continues to grow it will make fossil investments very unattractive.

      • neroden

        There will be some weird gyrations in oil prices in the next few years. There’s an old Deutsche Bank report which has proven very accurate. It predicted:
        (1) high prices cause permanent demand destruction
        (2) low prices cause an end to exploration, and as such prevent new supply from appearing
        (3) Repeat 1 until size of oil market is miniscule

        Coal has already hit the final death stage. Coal is cheap because nobody wants it, and is being sold at a loss at the mine entrance. It costs more to transport than it does to buy, and the railroads aren’t going to cut their price, because they can move more valuable commodities and make more money. A new-build coal power plant is more expensive than a solar or wind plant. Just putting mercury controls on the old coal plants is so expensive they’re not viable. A few coal power plants located right next to coal mines will survive for a while longer.

        Also, China has officially decided not to import coal, and so has India, so overseas coal shipping is dead.

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