Environmentalists have been pressing UC and other universities to divest from coal and other fossil fuel industry holdings and had some success last year when
UC still has about $10 billion in various types of energy industry investments, about 10% of the $100 billion or so it holds in endowment and pension funds, UC spokeswoman Dianne Klein said. There are no plans to extend the sell-off into oil and natural gas.
The coal and oil sands sell-off was announced Wednesday by UC's chief investment officer, Jagdeep Bachher, at the meeting of the UC regents' investment committee. According to a transcript of the meeting, Bachher said that "slowing global demand, an increasingly unfavorable regulatory environment, and a high threat of substitution pose insurmountable challenges to coal mining companies." And he added that "sustainability issues" also have made it too risky to remain in oil sands businesses.
UC's investment pull out was done gradually and without fanfare over several months, officials said. The moves involved only direct stock holdings and not investments in mutual funds, which may still include some coal and oil sands companies.
State lawmakers last week sent the governor a bill that would require the state's public pension funds to divest their holdings in coal.
In a tweet Wednesday night, environmentalist and writer Bill McKibben, co-founder of the group 350.org, said that "it looks like the Univ. of California is divesting its enormous portfolio from coal and tarsands oil. If true — wow." He could not be reached for comment. His group is pressing for action to end and reverse global warming.
UC student activists praised UC's action.
"I think it's a really good move by the university. But it doesn't mean we are going to stop pushing for full divestment soon," said Alden Phinney, a UC Santa Cruz student who is active in Fossil Free UC.
That group has been pressing the university to divest itself of its holdings in all fossil fuel industries, including oil and natural gas, out of concerns that burning those fuels is hastening climate change.
Last year, the UC regents decided not to formally divest stocks and holdings in oil, coal and natural gas from the university's endowment and retirement funds but moved to have environmental and social issues more deeply influence investment decisions. At the time, the action disappointed student activists from Fossil Free UC.
Gov. Jerry Brown, who is a UC regent, added his voice to the debate last year when he suggested that UC study dropping coal.
In contrast to more traditional drilling for oil, the oil sands industry often uses strip mining or techniques requiring much water and steam to extract the form of petroleum known as bitumen from mixtures of sand and clay found in Canada, Venezuela and elsewhere.
For more news, follow @larrygordonlat.
MORE EDUCATION NEWS