Report: Fossil Fuel Divestment Would Cost Pension Funds Trillions

Divestment could lead to reduced payments to pensioners, taxpayer bailouts

A move away from fossil fuel investments by 11 of the nation's major public pension funds would lead to a nearly $5 trillion shortfall over the next 50 years, according to a new report from University of Chicago professor Daniel Fischel.

The report comes as environmentalists renew their push to get pension funds to divest from fossil fuels following President Trump's withdrawal from the Paris Accord. Elected officials in both New York state and New York City have pushed for both to rapidly divest their billions of dollars worth of fossil fuel investments.

"By fully divesting New York City pension funds from coal, oil, and gas, we would take a prudent step toward protecting 1.5 million pension holders," said city council member Helen Rosenthal last month.

The report from Fischel, formerly the dean of University of Chicago Law School, says that those pension holders would actually see the city's funds shrink by over $100 million annually if they were to divest, and that it would have "minimal or no environmental impact."

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