San Diego to stop investing in the fossil fuel industry to avoid contradicting the city’s climate goals

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San Diego will soon join New York, Los Angeles, Pittsburgh and many other cities that are no longer investing their financial reserves in the fossil fuel industry because it contradicts municipal efforts to fight climate change.

San Diego will prematurely sell off a recent $ 17 million investment in Chevron before the new policy, approved by San Diego City Council last month, goes into effect Jan. 1.

City officials have not clarified whether other stakes in San Diego’s $ 2.33 billion portfolio are to be sold because the companies engage in exploration, production, drilling or refining. coal, oil or natural gas.

Mayor Todd Gloria said the policy aligns the city’s investments with the city’s values ​​and will boost progress towards San Diego’s climate action goals by not providing financial support to companies that increase gas emissions. Greenhouse effect.

“For San Diego to be a global leader on climate, our actions must match our words,” Gloria said after the board’s 8-1 vote.

Council member Sean Elo-Rivera said aggressive action by cities is needed to stop accelerating climate change.

“Divesting from fossil fuel companies and other extractive industries is an important step in aligning our policies, plans and portfolios with the moral imperative to take immediate climate action,” he said. “By removing the power of these industries from our economy, we are shifting that power towards equitable climate solutions. While this does not solve our climate crisis, it is an important step. “

Council member Chris Cate, who alone voted “no,” said the new policy contradicts the city’s recent investments in natural gas vehicles and natural gas service stations that have cost millions.

“I think it’s contrary to what we’ve done as a city,” Cate said, noting that the policy was unveiled shortly after Gloria updated the city’s climate action goals. . “I understand the timing and why this was brought forward, but I don’t agree with it.”

Cate is the only Republican member of the council.

A fossil fuel divestment policy for San Diego was first proposed nearly two years ago by board member Chris Ward, who left the board last December to join the state assembly. Ward’s proposal was blocked at the council’s economic development committee.

Board member Joe LaCava said the San Diego rulers could hardly be considered pioneers.

“Divestment may be new to us, but we are following the model already set by cities and institutions around the world,” he said.

LaCava noted that the board has the ability to review and adjust its investment policies every year, so the new ban can be changed in the event of unforeseen consequences.

Critics of divestment policies say they do not lead to reduced demand for fossil fuels, but give environmentally conscious investors less leverage over fossil fuel companies.

San Diego’s new ban does not apply to subsidiaries of companies involved in fossil fuels. And the city will not stop investing in a common public fund even if it does not have a policy prohibiting investments in fossil fuels.

The new policy will require the city to prematurely sell $ 17 million in Chevron bonds that are due to mature in March 2022. Selling by December 31 instead of waiting until March will cost the city around $ 70,000, they said. officials said.

Gloria said the city will try to reinvest money previously given to fossil fuel companies in sectors focused on alternative energy and sectors offering well-paying jobs.

On a related note, city officials said they have yet to start exploring cryptocurrency investments, as California law still prohibits cities from making such investments.


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