The commitment is unambiguous: “A consistent climate policy for us means that we refrain from investing in fossil fuels. We therefore support the divestment campaign and want to examine if public money in Baden-Württemberg is still invested in fossil fuels and how we can gradually pull back from such investments.” This is a quote of the Green election manifesto of Baden-Württemberg – a region where the Greens have received the most votes in comparison to all other parties last Sunday and will very likely continue to be at the head of government, with Winfried Kretschmann as state prime minister. (Read our analysis here).
On the same day, there were elections in Rhineland–Palatinate, and it is very likely that in this region, the Greens will continue to be part of the government. The regional Green party states similarly in their manifesto: “We are committed to withdraw investments from fossil fuels (“Divestment”). They reinforce the dirty production of energy for decades to come. The public sector shall serve as an example. Therefore, we will orientate the region’s investment policy to climate change targets. [...] We need to invest financial resources where sustainable innovation takes place.”
What would that look like in practice? Apart from direct investment in state projects or holding company shares, there are two big issues on the state level. Firstly, the pension funds of state officials, often containing several billion Euros that need to be invested. Secondly, in Germany there are seven regional banks owned (or partially owned) by the region’s government. Therefore, it has an influence on how the respective banks invests their capital.
Thus, the outcome of Sunday’s regional elections is yet another step towards reallocating capital from dirty fossil fuels to clean renewables. Now it’s on us to convince our prospective coalition partners of the necessity to divest. And we have good arguments to do so: Many studies have proven that investing in fossil fuels is actually an economic risk as prices go down and political decisions force energy companies to “keep it in the ground”. There is a carbon bubble that will burst at some point as many financial players have also come to realize (read more here). If you really care about jobs and energy security, divesting from fossil fuels while at the same time investing in renewable energy, is the path to follow. We are confident that the results the Greens have achieved will lead to more concrete successes of the divestment movement – by German regional governments withdrawing their capital from fossil fuels.