In the midst of the coronavirus pandemic, a dozen members of the New York City Council have seized the opportunity to introduce a resolution calling on Wall Street to cut ties with traditional fuel sources, urging banks, money managers, and insurers to divest from companies in the coal, oil, and gas sectors.
However, this resolution ignores several key facts: traditional fuel sources continue to provide the lion’s share of American energy, natural gas has played a key role in lowering carbon emissions, and financial institutions are not responsible for dictating our energy policy.
As the U.S. Energy Information Administration (EIA) reports, fossil fuels are responsible for meeting nearly 2/3 of our nation’s electricity needs. In addition, petroleum products accounted for about 92% of total U.S. transportation sector energy use. On the other hand, the presumed preferred source of energy for these lawmakers, such as wind and solar, produce less than 10% of the country’s electricity.
As reported by the International Energy Agency (IEA) earlier this year, global carbon dioxide emissions flatlined in 2019, despite widespread expectations of another increase. The Agency credits this to declining emissions from electricity generation in advanced economies, as the United States led the way with the largest emissions decline of any country. The U.S.’ success is largely due to the increase in natural gas-fired electricity generation. Natural gas is part of the solution – not the problem.
As written in a report last year on the dangers of anti-pipeline activism and tortious interference, legal experts Phil Goldberg, Jamie Thompson, and Dalton Mott argue that financial institutions do not establish public policy:
“Private lending institutions are engines of commerce, not administrative agencies or legislative bodies. Bank officers are neither elected government officials nor arbiters of economic, social, or environmental issues. They fund legitimate business enterprises, and large-scale infrastructure developments are lawful, profitable endeavors for them.”
Rather than promoting an anti-fossil fuel agenda, it is essential that lawmakers – from city councils to federal elected representatives – act in the best interest of their constituents (energy consumers) and the American economy. Now is not the time to gamble with our nation’s energy future.