Norwegian Government Pension Fund Still Major Coal Investor

Published by MAC on 2015-03-18
Source: Urgewald, Greenpeace, Framtiden.no

Norwegian Government Pension Fund Still Major Coal Investor

Joint press release

16 March 2015

NGOs have analyzed the new holdings list of the Norwegian Government Pension Fund (GPF), which was published last Friday. Since 2013, the coal investments of the world’s largest sovereign wealth fund have sparked an ongoing political debate, in which several of Norway’s political parties and the country’s environmental organizations are calling for an exclusion of coal stocks and bonds from the Pension Fund’s portfolio. As the GPF’s manager NBIM (Norges Bank Investment Management) recently announced a divestment from dozens of coal companies,[1] the publication of the new holdings list was awaited with great anticipation.

Heffa Schuecking, director of the German NGO urgewald, explains: “As our 2014 report ‘Dirty & Dangerous’ analyzed the GPF’s previous holdings, we were curious to see which coal companies were dropped and how this affects the Pension Fund’s overall participation in the coal sector. Our first analysis shows that the GPF divested from 53 coal companies, which is 1/3 of the total number of coal companies we found in the portfolio last year. While this is a laudable first step, the overall result is very disappointing as the GPF’s total investments in the coal industry show only a marginal decrease.”

According to Schuecking, the GPF’s coal holdings currently still amount to NOK 79 billion (€ 9.16 billion), which is only 4.6% less than the NOK 82.7 billion (€ 9.59 billion), identified by urgewald in the GPF’s 2013 portfolio. While the divestment achieved by dropping 53 coal companies amounts to NOK 7.7 billion, half of this sum was used to either top up existing coal holdings or invested in new coal companies.

“This is well illustrated by the development of the GPF’s coal portfolio in China and India,” says Truls Gulowsen of Greenpeace Norway. “We are happy to see that the GPF divested a total of NOK 729 million by dropping 13 Indian coal companies, but at the same time, it has increased its investments in the Chinese coal sector by NOK 741 million. China’s coal consumption is not only a huge threat for our global climate, its coal companies are exhausting water resources and causing enormously destructive impacts on people and the environment in China.”

Arild Hermstad from the Future in Our Hands, Norway’s largest environmental organization, adds: “Simply shifting destructive investments from one place to another cannot be the solution. Our analysis shows that the GPF, for example, upped its stake in the U.S. company Duke Energy from NOK 1.6 billion to NOK 3.3 billion in 2014. This company is under criminal charges for illegally dumping millions of gallons of toxic coal ash into rivers, and will likely have to pay the second highest Clean Water Act fine ever levied in the U.S.[2]. What we need is real coal divestment and we need it now.”

“The only way to achieve meaningful divestment, is to adopt a clear set of exclusion criteria,” says Heffa Schuecking. The report “Dirty & Dangerous” co-published by urgewald, the Future in Our Hands and Greenpeace Norway suggests 5 simple, but effective criteria for eliminating large parts of the coal sector from the GPF’s portfolio. To view the 5 criteria, see page 40-41 of the report.

Referring to the coal divestment criteria adopted by Norway’s largest private pension Fund KLP in 2014,[3] Truls Gulowsen of Greenpeace comments: “It is shameful that Norway’s private pension funds are far more willing to take action on the coal issue than the Government Pension Fund. Investing oil proceeds into the coal industry is the worst possible use of our nation’s money.”

“In the lead-up to the Paris Climate Summit, the Norwegian Parliament has a unique chance to show the world what responsible investment means by adopting exclusion criteria for the dirtiest fossil fuel. The GPF’s coal investments are tiny in relationship to its total holdings, but the problems they cause around the world are huge,” says Arild Hermstad of the Future in Our Hands.

[1] NBIM: Responsible Investment
[2] See: Duke Energy Is Charged in Huge Coal Ash Leak, New York Times, 20 Feb 2015
[3] For more information on KLP’s divestment see: KLP: "31 new companies excluded"
For further inquiries and interview requests, please contact:

Heffa Schuecking: heffa[at]urgewald.org or +49 160 96761436
Truls Gulowsen: tgulowsen[at]greenpeace.org or +47 901 07 904
Arild Hermstad: arild.hermstad[at]framtiden.no or +47 980 36 762

About urgewald
urgewald is a German non-profit organisation, whose mission is to address the underlying causes of global environmental destruction and poverty.