This meeting of the Pension Fund Committee will be held virtually in order to conform with current guidelines regarding social distancing. Normally requests to speak at this public meeting are required by 9 am on the day preceding the published date of the meeting. However, during the current situation and to facilitate these new arrangements, we are asking that requests to speak are submitted by no later than 9am four working days before the meeting i.e. 9 am on 30 November 2020. Requests to speak should be sent to Deborah.miller@oxfordshire.gov.uk together with a written statement of your presentation to ensure that if the technology fails then your views can still be taken into account. A written copy of your statement can be provided no later than 9 am 2 working days before the meeting.
Where a meeting is held virtually and the addressee is unable to participate virtually their written submission will be accepted
.
Written submissions should be no longer than 1 A4 sheet.
Minutes:
The Committee received public addresses from Mr Michiel Stofferis from Fossil Free Oxfordshire.
Mr Stofferis informed the Committee that he was a Dutch earth scientist and before joining Fossil Free Oxfordshire in 2018, he had worked for 35 years in the oil & gas industry, developing fields and certifying reserves.
Members were informed that Fossil Free Oxfordshire were happy that the Pension Fund was reducing emissions of their investments at a pace of 7.6% every year, yielding a 50% reduction in emissions by 2030. However, Members were reminded that this was at odds with the OCC net-zero emission target by that date, which would require a more drastic reduction target.
Mr Stofferis commented that Fossil Free Oxfordshire did not understand why the fund continued to invest in fossil fuel companies. These continued investments allowed fossil fuel companies to press on with exploration and development of new fields. These extra fossil fuels found their way to a market of consumers, whom, on the other hand, OCC required to reduce CO2 emissions in line with the decarbonising of the fund. So, by these continued investments OCC were creating their own stranded assets and delaying the urgent energy transition.
Currently neither the Oxfordshire Pension Fund nor Brunel had targets for an annual reduction of fossil fuel reserves and yet scientific evidence of superfluous fossil fuel reserves was available in many publications. The reputed independent think-tank Carbon Tracker reported last year that there was more than 50 years’ worth of proved oil and gas reserves as of end 2018.
Mr Stofferis said that as an oil and gas reserves certifier, he completely concurred with this estimate. The carbon budget that would keep us below 1.5°C global warming allowed us to burn only 13 years’ worth of reserves as of end 2018. In a Paris aligned world, 75% of current reserves would be stranded and the development of new fields would be a waste of investors’ money.
There were existing tools to reduce exposure to fossil fuel reserves: instead of using antiquated benchmarks, such as FTSE, benchmarks fit for the challenges of the 21st century were needed. Climate Transition Benchmarks (CTBs) and Paris Aligned Benchmarks (PABs) already existed. Not only did these benchmarks insist on a 7% annual reduction in emissions, but they also insisted on big reductions in fossil fuel reserves (PABs require more than 50% over 10 years). For example, TPI in cooperation with the Church of England have developed the FTSE TPI Climate Transition Benchmark. Since the beginning of the year this benchmark was being used by the Church of England for a £600 million fund, reducing the exposure to Fossil Fuel Reserves by 69%.
If Oxfordshire Pension Fund was to be aligned with the Paris Agreement, the same approach was required. And this could only be done, if Brunel started using more modern Climate Transition benchmarks or even better Paris-Aligned benchmarks, so that exposure to fossil fuel industries was reduced.
In conclusion, OCC were urged to require that Brunel adopted these benchmarks for all your portfolios to enable you to implement your climate policy.