Municipality opts for a fund that may contain fossil fuels over fossil-free option – really?
I was both surprised and disappointed to learn that on March 3 Squamish Council voted to invest $5 million in the Municipal Finance Authority (MFA) mortgage fund that allows fossil fuels.
The only other option was in MFA fossil-fuel-free (FF) bonds. Granted, option 1 offered “a little bit better rate” according to District of Squamish staff. It invests in mortgages and has a lock-in period of three to five years with a return 2.4 to 2.7%. However, option 2 — the MFA FF bond fund — paid 1.67%, but was both more liquid and carries lower risk.
According to the District presentation, 10% of the mortgage fund “may be invested in some companies that are related to fossil fuels.”
So what are the investments? I emailed council members and after not receiving a reply, contacted municipal hall and was told that I would have to file a “third-party request” through the Freedom of Information and Protection of Privacy Act which normally takes 30 days, but now could take up to 60 days.
Interestingly, Mayor Karen Elliott said at that meeting that she was not going to support this motion as “the MFA has dragged its feet in securing fossil-fuel-free investments and would like to look at other investments outside the MFA,” but voted for it anyway.
Less than a year ago on July 3, 2019, Squamish council declared a climate emergency. Apparently, it would seem it’s not enough of an emergency to vote fossil-free with municipal investment dollars.
Putting aside climate for a moment, I have conducted significant research on the fossil fuel divestment question and how these companies have performed over the last few years. A basket of 21 well-known FF companies have lost an average of 40% since between 2014 and August 2019 compared to an average gain of better than that for a similar sized basket of clean technology stocks.
And given the rising cleanup, health and environmental costs, it’s hard to see how this picture will improve. Case in point, in 2018 the Albert Energy Regulator (AER) estimated cleaning up oil and gas properties could cost an estimated $260 billion.
So if now is not the time to send a consistent message on making necessary changes and investing in clean technology and jobs, when will it be time?
Founder, Squamish Alternative Energy Group
**Please note, in the print edition of this letter, the last words of Matt's title were inadvertently cut off. It should have read as online.