California Coal Divestment Bill Inches Closer to Passage; CalPERS, CalSTRS Take No Stance

A bill, which would require CalPERS and CalSTRS to divest from their coal holdings, inched one step closer to passage on Wednesday.

A California Assembly committee approved the measure on Wednesday by a 5-1 vote; the bill has already cleared the Senate.

From Reuters:

The bill now heads to the California Assembly Appropriations committee. If it passes, it will go to the Assembly floor, where supporters expect stiff opposition from Republicans and moderate Democrats.

Calpers said its thermal coal mining investments as defined under the bill are valued at $100-200 million. It has investments in coal companies including Peabody Energy and Arch Coal according to its latest investment report.

CalSTRS has holdings of around $40 million, according to spokesman Ricardo Duran. Both Calpers and CalSTRS said they did not have a position about the legislation.

Calpers spokesman Joe DeAnda said if Calpers was required to divest, funds would be reinvested according to its equity index.

Before the vote, bill author and California Senate President Pro Tem Kevin de Leon told the committee that coal is a bad investment because coal plants were closing in the United States and demand from the world’s largest consumer, China, was reduced.

“The writing is on the wall. Our policies, our technologies, and global markets are moving in concert away from coal as an energy source,” de Leon said.

As noted above, the pension funds have between $140 – $240 million invested in coal, collectively.

Read more Pension360 coverage of the bill here.

Photo by  Paul Falardeau via Flickr CC License