In recent weeks, important developments in relation to divestment from fossil fuels have shown that this is not only a moral obligation, but also an economic necessity.
On March 9 2016, one of the “big four” German energy companies had to announce their biggest loss ever in the history of the company: In 2015, E.on lost almost 7 billion Euros, after a previous loss of 3 billion in 2014. The main reason for this was that they had to drastically correct the value of their coal and gas power plants. E.on had to write off almost 9 billion Euros on this specific initiative alone.
E.on’s business concept obviously does not work anymore. The company is a dinosaur, trying to earn money with resources that simply have no future anymore. Some specialists in finances seem to grasp this concept better: Three days before, on March 7, banking company JPMorgan Chase announced that they will no longer finance new coal mines, globally – although they’re not pulling back from fossil fuels completely, it is a big step towards divestment. Interestingly, JPMorgan Chase cited not only the reasons of corporate responsibility, but they also stated that they “believe that balancing environmental and human rights issues with financial priorities is fundamental to sound risk management”. Their full statement can be found here.
Similarly, a member of the Rockefeller family, Neva Rockefeller Goodwin, stated in February: “I lost faith in Exxon Mobil's future value” and consequently donated all her shares of the company. These are only three recent events, but they clearly show a pattern: The carbon bubble is getting frail, it will not last.
However, this is not a development happening on its own. It needs the pressure of civil society, shareholders, politicians and many other interest groups. That is why the European Green Party views itself as a vital part of the rapidly expanding divestment movement – in 2016, the campaign on divestment from fossil fuels will be the priority topic of the European Greens' efforts.
And it’s not only our decision to act – you can do it, too! Do not allow your money to work for fossil fuels, but ask your bank how they invest. If they don’t tell you, you can assume that they invest in coal, oil and gas.
On average, 1.5% of every bank’s portfolio is invested in fossil fuels. What sounds little is actually a lot, once you know how much capital a single bank manages.
Why is investment in fossil fuels so harmful? What is divestment? And what you can do? We asked Rosa Stucki from the Belgian Non-profit-organisation Financité in this video: