Divestment idea draws fire
University of Denver mulls proposal to remove oil, gas from investment portfolio.
Colorado’s energy industry went on the offensive Thursday before an expected decision by University of Denver trustees about whether to pull investments from oil, natural gas and coal companies.
The university is the latest to take on the issue of divesting its endowment of fossil fuels, pushed by students concerned about climate change.
The Independent Petroleum Association of America‘s forum in Denver marked the kickoff to a national social media campaign — a counterattack on 350.org, a New York-based climate-activist organization focused on persuading institutions to purge fossil fuel investments.
The University of Colorado, Colorado College and Fort Lewis, along with Harvard and the Massachusetts Institute of Technology, have rejected similar studentled petitions in recent years. Naropa University in Boulder is the only Colorado higher-education institution that has pledged to divest. Yale, Stanford, the University of California and the University of Washington have dropped investments in coal or otherwise “partially” divested in fossil fuels.
Pulling investments from oil and gas companies would have little effect aside from damaging the university’s ability to fund faculty research and student scholarships, said the forum’s speakers. It’s “a symbolic gesture, a political stunt,” said Simon Lomax, a Denver-based adviser to the petroleum association’s “Divestment Facts” project.
Lomax accused 350.org of using student activists at campuses across the country to help the group “stigmatize the oil and gas industry.” And DU mechanical engineering student Scott Albertoni said there is a misconception that most students are concerned about fossil fuel investments or even aware of the issue. “If you ask about divestment, you get a blank stare from my peers,” he said.
But Lori Scott, a DU senior majoring in gender studies and Spanish and part of the “Divest DU” advocacy group, said the university should “not continue to invest in the destruction of the climate and of people’s lives.” The student group wants DU to remove investments in the top 200 fossil-fuel companies.
“Our goal is not to stigmatize the people who ended up working in the industry,” she said. “The goal is to change the climate we live in,” in part by persuading the industry to move toward clean energy.
The oil and gas industry invested $90 billion in zero- and low-emissions technology from 2000-2014, according to Tracee Bentley, executive director of the Colorado Petroleum Council and a forum speaker. That’s second only to the federal government’s $110 billion, she said.
And Chris Fiore, a senior econo-
mist with Compass Lexecon, which studied university divestment for the industry, said it could cost DU between $68 million and $250 million during the next 20 years if school trustees vote to divest. As a private university, DU’s endowment and investment profile are not public, so Fiore’s estimates were based on DU’s overall mix of investments.
DU would have to spend money to research companies to determine whether they met its environmental standards, and consider whether the university would invest in a company with oil and gas interests as well as wind and solar power projects, he said. Divestment by universities likely would not affect the price of energy stock nor affect cli- mate change, he said.
A DU task force to study fossil fuel divestment has held seven hearings, from July through October. The panel, which includes three university trustees, was formed after an April presentation from students, who focused on the “urgency of the climate crisis, its environmental costs and the University of Denver’s moral obligation to combat it,” according to a statement by task force chairman Jim Griesemer.
The task force planned to meet privately after the public hearings and is expected to write a recommendation to the full board of trustees for consideration at its January meeting.
At the start of the hearings, Griesemer wrote that the task force agrees with NASA’s findings that climate change is caused by greenhouse gas emissions by “human activities.”
“We begin our work by accepting the reality of global warming and the probability that the burning of fossil fuels is a significant, perhaps the major, contributor to this genuine problem, one which all — institutions and individuals — have a moral responsibility to address with the sense of urgency urged on us by our DU Divest DU students,” he wrote.
Griesemer did not respond to requests for comment for this story. The university’s vice chancellor for legal affairs, Paul Chan, told the task force the school’s mission is education, not environmental protection. Divesting from fossil fuels would increase the cost of managing the university’s endowment because of staff time, limit DU’s choices of funds and managers, and “harm companies that are also working on meaningful change,” he said.