Some recent climate and divestment headlines

Norway confirms $900bn sovereign wealth fund’s major coal divestment 
“Norway’s parliament has formally endorsed the move to sell off coal investments from its $900bn sovereign wealth fund, the world’s biggest. It is the largest fossil fuel divestment yet, affecting 122 companies across the world, and marking a new success for the fast-growing and UN-backed climate change campaign.”

Australia: CFMEU backs Labor RET on condition of unprecedented assistance for vulnerable workers
“The surprise backer of a 50 per cent renewable energy target at the Labor Party’s weekend conference was Australia’s largest coal mining and energy union. Construction Forestry Mining and Energy Union (CFMEU) president, Tony Maher, seconded Bill Shorten’s energy policy, on the condition a Labor government provide unprecedented assistance for thousands of workers in traditional coal-fired generators and mines who might lose their jobs. “We’ve got to face the reality in domestic coal-fired power,” Mr Maher told 7.30.

Largest Australian Utility Polluter AGL Set To Decarbonize By 2050

RWE sheds old business model, embraces transition
RWE, Germany’s largest power producer, has decided to radically depart from its traditional business model based on large-scale thermal power production. Henceforth, the company will “create value by leading the transition to the future energy world”. This is shown by confidential strategy documents that were discussed at a recent meeting of RWE’s Supervisory Board in Warsaw which Energy Post has seen.”

Senior management of Enel and Greenpeace meet
(Enel is the largest Italian energy utility) “Following the appointment of the new company management, Enel’s industrial strategy is focused on further boosting investment in renewable sources, energy efficiency, smart grids and storage systems. The Group is also committed to gradually phasing out further investment in coal.”

[Governor of Bank of England] Mark Carney: most fossil fuel reserves can’t be burned
“The governor of the Bank of England has reiterated his warning that fossil fuel companies cannot burn all of their reserves if the world is to avoid catastrophic climate change, and called for investors to consider the long-term impacts of their decisions. According to reports, Carney told a World Bank seminar on integrated reporting on Friday that the “vast majority of reserves are unburnable” if global temperature rises are to be limited to below 2C.”

This is what the utility death spiral looks like
“The German mega-utility RWE provided another dismal reminder today of the painful transition European power companies are undergoing. According to 2013 financial results, the utility lost more than $3.8 billion last year as it cycled down unprofitable fossil fuel plants due to sliding wholesale prices. The yearly loss is actually quite historic; it’s RWE’s first since 1949 when the German Republic was formed. This follows poor earnings news from Vattenfall, a Swedish utility with the second-biggest generation portfolio in Germany, which saw $2.3 billion in losses in 2013 due to this same “fundamental structural change” in the electricity market.”

South African retirement funds, representing R3 trillion in assets, play a critical role in channelling capital flows towards the achievement of a sustainable energy future in this country (pdf)
“Some R540 billion in private capital will be required to achieve the renewable energy vision for 2030 outlined in a previous study (Sager 2014), of which debt accounts for the lion’s share at R405 billon. SA wholesale banks active in financing REIPPPP projects have reached average exposure levels of 4-5% of their portfolios, nearing prudential portfolio limits. For comparison, the additional renewable energy (RE) debt requirement over the next 15 years is equivalent to a third of this group’s current net loans and advances. Retirement funds, with R3 trillion assets and long term liabilities, could supply R150bn of this debt requirement.”

Climate Change Investment Solutions: A Guide for Asset Owners (pdf)
“Investors are in a unique position to make the economic case for climate and energy policies that send the appropriate price signals to incentivise low carbon, clean energy investment.”

How Divestment Activists Saved ANU a Fortune
“When it comes to fossil fuel divestment, ethical investing could save you a fortune. For example, back in October last year, the Australian National University took the decision to listen to its staff, students and alumni, and as a result, it sold its shares in a number of fossil fuel companies, one of which was Santos Limited (ASX: STO)…. Since we don’t know the exact shareholding of each company, it’s impossible to know how much money the divestment decision has saved the uni. But the size of the ANU’s $1.1 billion fund certainly suggests it was a small fortune.”

AMCEN Declaration Urges Action on Climate Change, Illegal Wildlife Trade, Green Economy
“Ministers and delegates from 54 African nations adopted the Cairo Declaration at the AMCEN session, which convened in Cairo, Egypt, from 2-6 March 2015. The session took place under the theme, ‘Managing Africa’s Natural Capital for Sustainable Development and Poverty Eradication.’ Ministers stressed that a new climate change agreement, which is expected to be agreed at the 2015 Paris Climate Change Conference, must ensure that mitigation ambition keeps global temperatures below 1.5 degrees Celsius from pre-industrial levels by the end of the century.”

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