New Report Highlights Complexities of Pension Fund Investments in Fossil Fuels & Subsequent Harm to Coloradans; Report Mirrors Concerns with PERA Investments

COLORADO and VANCOUVER, B.C.: A new in-depth legal analysis was released today by the Canada Climate Law Initiative, revealing how investments in the oil and gas sector by the Canada Pension Plan (CPP, formerly CPPIB) are directly and adversely impacting Coloradans’ public health and safety. 

A key finding of the report highlights that CPP owns 95% of Crestone Peak Resources (Crestone), a Denver-based hydraulic fracturing (fracking) company. Crestone has come under scrutiny for oil and gas development less than half a mile away from schools, homes, and playgrounds, contributing to poor air quality, increased respiratory illnesses, and other public health issues in Colorado. Crestone drilling projects have generated thousands of complaints to Colorado’s oil and gas regulators about poor air quality, toxic fumes, poisonous gas leaks, explosions, health problems and illnesses. 

Mounting concern over pension fund investments in fossil fuel companies have led to the formation of the Climate Safe Pensions Network, a coalition of more than a dozen organizations throughout North America (including Fossil Free PERA) calling on pension funds to tackle climate-related financial risk and curb investments in fossil fuels.

“Canadians would be shocked to learn what our national pension savings are being used for in Colorado,” says Adam Scott, Director of Toronto-based Shift Action for Pension Wealth and Planet Health. “It’s alarming that a fracking company owned and managed by the Canada Pension Plan is putting Colorado’s communities, health and environment at risk and spending hundreds of thousands of dollars to influence foreign elections. And all in the service of a high-carbon, high-risk sunset industry that’s fueling the climate crisis and completely inconsistent with Canada’s own climate commitments.”  

Shift (based in Canada) has teamed up with Fossil Free PERA, Colorado 350, and other organizations throughout North America to form the Climate Safe Pensions Network, demanding changes to pension funds’ fossil fuel investments and their approach to managing the financial risks of climate change and the clean energy transition.

Today’s new report highlighting Canada Pension Plan’s problematic fossil fuel investments in Colorado mirrors concerns regarding fossil fuel investments held by Colorado’s Public Employees Retirement Association (PERA), which manages the pensions of half a million current and former state employees. PERA has similarly come under scrutiny for its fossil fuel investments by the Fossil Free PERA coalition, which has called out PERA’s problematic investments in Suncor and Extraction Oil and Gas, both under scrutiny for harming local communities through dangerous pollution violations, particularly near lower income communities and communities of color. 

“In Commerce City, the Suncor Oil Refinery is facing a $9 million settlement for violating air quality regulations, by filling the air with dangerous pollutants,” says PERA member and teacher Renee Millard-Chacon. “These air quality violations have caused a variety of health problems for nearby residents, including asthma, cancer, and heart and lung complications. The areas most affected by Suncor’s pollution are low-income communities and communities of color. We do not want our public money invested in these companies which are adversely impacting our public health and safety.”

Fossil Free PERA members are calling on PERA to decarbonize its portfolio in line with the Paris agreement, curb investments in coal, oil and gas, and increase investments in climate solutions like renewable energy and clean technology. Last fall, a study revealed that three major state pension funds in California and Colorado (CalPERS, CalSTRS and PERA) collectively lost over $19 billion in retirement savings for teachers, state troopers and other public workers by continuing to invest in coal, oil, and gas. 

“Just like the Canada Pension Plan, Colorado’s PERA is investing public funds in ways that threaten the health and safety of our state,” says Giselle Herzfeld of 350 Colorado. “Fossil fuel investments are directly threatening the health, safety, and wellbeing of Colorado residents and families. Across our state, communities are experiencing dangerous consequences from this expansion of oil and gas drilling, and the question should be, do we want our public money and pension funds supporting this?” 

A new video was released today from impacted Coloradans to PERA members citing concerns about the role of PERA investments in harmful fossil fuel investments. 

Over 1,110 institutions have now committed to policies black-listing some combination of coal, oil and gas investments due to mounting concern over climate and litigation risk and adverse public health impacts associated with fossil fuel investments. These include sovereign wealth funds, banks, global asset managers and insurance companies, cities, pension funds, health care organizations, universities, faith groups, foundations, and the country of Ireland. 


Canadian Report Summary 

The report shows how the CPP’s substantial private equity investments in the oil and gas sector in recent years are inconsistent with Canadian and global climate commitments and underestimate the urgent need for climate action and energy transition. It argues that CPP is not providing adequate transparency to Canadians about these investments and their associated climate risk. The report focuses on recent private equity investments, including:

  • A CA$2.6 billion investment in Wolf Midstream that will facilitate the expansion of oil sands production;
  • An €830 million investment in Nephin Energy to exploit natural gas reserves off Ireland’s coast. The new Irish government is now banning new licenses for offshore gas exploration and production;
  • 95% ownership of Crestone Peak Resources, a Colorado fracking company that faces numerous regulatory complaints over pollution and health concerns and a moratorium on fracking in some Colorado counties. Crestone spent over US$600,000 on pro-fracking candidates and superPACs in the 2018 state elections.

The report calls for increased disclosure and transparency from CPP, casts doubt on the alignment of CPP’s investing strategy with Canadian and global climate commitments and the global energy transition, and questions how investing in fossil fuels is aligned with CPP’s fiduciary responsibility to provide retirement security for Canadians, young and old.