Ireland was ranked the second-worst performing European Union country as regards climate action, in front of Poland, according to a study published by an environmental campaign group Climate Action Network Europe. The report also found that Ireland is not on course to meet its emission reduction targets for 2020. In order to align with its climate change commitments agreed in the Paris Agreement, the Irish Parliament passed the Fossil Fuel Divestment Bill in July 2018, expected to come into force by the end of the year. Ireland is set to become the first country in the world to divest public money from fossil fuel assets.
The Fossil Fuel Divestment Bill compels the 8.9 billion euro Ireland Strategic Investment Fund (ISIF) to divest direct investments in fossil fuel undertakings within five years and not to make future investments in the industry. The ISIF is managed by Ireland’s National Treasury Management Agency. As of June 2017, the fund’s investments in the global fossil fuel industry were estimated at 318 million euros across 150 companies. The Bill defines fossil fuel undertakings as those “whose business is engaged, for the time being, in the exploration for or extraction or refinement of a fossil fuel where such activity accounts for 20 percent or more of the turnover of that undertaking.” An independent TD Thomas Pringle said: “This will make Ireland the first country to commit to divest public money from the fossil fuel industry. Ireland must take on its fair share of the burden of climate action.”
Irish commitment to divesting from fossil fuels is a victory for the international fossil fuel divestment movement. Recently, fossil fuel divestment has gained traction as the Norwegian central bank proposed selling off its $35 billion oil and gas stocks, and the Church of England has also recently voted to withdraw its funds from fossil fuel companies as well. Although Norway, the largest oil producer in Europe, has not yet decided on whether to divest, it is a signal of rising pressure on oil, gas and coal companies rising doubts about the future of the petroleum business. In the United States, New York City announced a goal earlier this year to divest its $189 billion public pension funds from fossil fuel companies in five years.
Gerry Liston, legal officer with the Global Legal Action Network, which helped draft the Bill said: “Governments will not meet their obligations under the Paris Agreement if they continue to financially sustain the fossil fuel industry. Countries the world over must now urgently follow Ireland’s lead and divest from fossil fuels.”