Global disinvestment from fossil fuels has crossed the $11trn mark – a massive leap from committed disinvestment of just $52m in 2014.
This represents around 16% of global investment in fossil fuels.
The disinvestment figure was announced at briefing in Cape Town on Monday before the start of an international summit, 'Financing the Future', organised by the global fossil free movement, a collaboration of non-government organisations campaigning for banks, pension funds, insurers and other large institutions to disinvest from fossil fuels.
The summit, with 300 registered delegates from 44 countries, hopes to "build power" among groups campaigning for disinvestment from fossil fuels and investment in renewable energy.
Emira Woods from Liberia said the $11trn disinvestment had "far exceeded" what they had expected since the launch of the campaign in 2011.
"We are standing against the fossil fuel industry and the harm they are doing to the planet. We can no longer ignore what is happening around us."
Banks cutting finance
A report released by the fossil free movement on Monday said an increasing number of banks were cutting finance to fossil fuel projects, particularly high-risk projects like coal and tar sands, while many insurance companies had ceased to underwrite coal projects.
In 2018 the UN Intergovernmental Panel on Climate Change (IPCC) warned that the world had until 2030 to make radical changes across sectors to cut emissions to keep the average global temperature increase to 1.5°C, the target agreed to by world governments who signed the Paris Accord. To achieve this, most of the remaining fossil fuel reserves would have to remain in the ground.
Kumi Naidoo, secretary-general of Amnesty International, described the struggle against climate change impacts as a struggle for human rights. Everyone who faced more frequent droughts, stronger hurricanes and increased water shortages had been "wronged by fossil fuel companies".
'Governments have failed us'
"Governments have failed us up to now. We need to get as much money as possible out of fossil fuels and into renewable energy – but in a way where we don’t violate human rights," Naidoo said.
One of the speakers was 24-year-old Australian ecologist Mark McVeigh, the first person ever to bring climate litigation against a pension fund.
McVeigh, from Brisbane, has filed a suit against the $40bn Retail Employees Superannuation Trust (REST) for failing to provide information related to climate change business risk.
McVeigh said he would be 60 in 2055, and almost certainly living in a world 2°C hotter – "or worse" – which would mean more severe droughts, increased fires, and the complete collapse of the Great Barrier Reef.
McVeigh wanted to see if his pension fund was doing any analysis of the climate change risks.
"They couldn’t give me anything. Last year I took REST to court claiming they had failed in their fiduciary duties. It’s the first of its kind where climate change risks are being tested under fiduciary duties."
Ahmed Mokgopo from the climate activist organisation 350.org, said the disinvestment campaign focused on the "moral dimension" of fossil fuel companies and their part in the global climate crisis.
"If it is wrong to wreck the planet, then it is wrong to profit from that investment," Mokgopo said.
However, Tim Buckley, of the Institute for Energy Economic and Financial Analysis, said disinvestment from fossil fuels was not a moral decision but rather about money – and companies not wanting to be left with stranded assets, as most of the coal technology was becoming obsolete.
Speaking to Fin24 afterwards, Buckley said this was particularly the case for disinvestment from thermal coal, the kind burned to generate electricity.
The move away from investment in coal was also linked to the massive drop in the cost of renewable energy in the last five years.
"We’ve reached a tipping point. Five years ago, this was theoretically possible, but today it is a technological reality. Nearly every week a bank, insurer or lender announces new restrictions on coal.
"Banks don’t move for moral reasons. It is all about the nexus of technology and finances," Buckley said.