California Senate President Kevin de Leon has introduced a bill that would force the state’s pension funds to exit all coal investments.
Additionally, CalSTRS and CalPERS would be prohibited from making new coal investments until 18 months after the bill becomes law.
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The California senate leader, Kevin de Leon, said he was introducing a bill on Tuesday calling on the two state funds – CalPERS, the public employees’ pension fund, and CalSTRS, the teachers’ pension funds, drop all coal holdings.
The bill is part of a larger package of climate measures – endorsed by Governor Jerry Brown – aimed at gearing up California’s efforts to fight climate change.
The former US vice-president and climate champion Al Gore spoke to the CalSTRS board in Sacramento last Friday. Gore has long argued that fossil fuels are a risky proposition as a long-term investment.
“Our state’s largest pension funds also need to keep their eyes on the future,” De Leon, a Democrat, said in an email. “With coal power in retreat, and the value of coal dropping, we should be moving our massive state portfolios to lower carbon investments and focus on the growing clean-energy economy.”
The two state funds are the biggest targets so far of a divestment movement that has moved from college campuses towards mainstream financial conversation.
De Leon’s proposal calls on managers of both state funds to withdraw from all coal companies, and make no new investments in coal within 18 months after the bill becomes law.
It further calls on the two funds to explore the feasibility of expanding its divestment, by divesting entirely from fossil fuels – including natural gas – and report back to the state legislature by 2017.
CalSTRS and CalPERS have a combined $299 million invested in coal assets, according to de Leon’s office.
Photo by Paul Falardeau via Flickr CC License