Local councils across the UK have invested more than £53 million in companies directly involved with the dash for onshore oil and gas through their pension funds, DeSmog UK can reveal.
A total of £53,178,179 of local councils’ pension funds is being invested in GDF Suez and INEOS, both of which have been awarded exploratory drilling permits in the latest round of fracking licences handed out in August this year.
The majority of that total is invested in GDF Suez, now known as Engie, which was recently awarded a license block to explore for onshore oil and gas near Skegness.
Greater Manchester Pension Fund, the largest investor in fossil fuels in the country (£1.3 billion), is also the largest investor in GDF Suez, investing a total of £25.7million of its pension fund in the French energy company.
Friends of the Earth’s senior energy campaigner, Simon Bullock, told DeSmog UK: “80 per cent of the world’s fossil fuel reserves need to stay in the ground to prevent dangerous climate change.
“Fracking for new gas supplies would make a bad situation worse. We should be trying to save energy, not drill Britain’s beautiful countryside. Council workers would be dismayed to know that their pension funds were invested in companies which are planning to frack and pollute their local area.”
Conflicts of Interest?
While the amounts invested in companies directly pursuing fracking in the UK might not be considered that big on the scale of pension investments, they could highlight potential conflicts of interest in councils that have dealt with, or are likely to deal with, fracking planning applications.
North Yorkshire County Council, which has £2,145,893 invested in GDF Suez, has been presiding over applications by Third Energy to carry out fracking at its Kirby Misperton site.
Similarly, East Riding of Yorkshire Council, which has £941,413.00 of its pension fund invested in GDF Suez, oversaw Rathlin Energy’s applications to explore for onshore oil and gas at three sites in the county.
Elsewhere, Somerset County Council, has invested over £600,000 from their pension fund into multinational chemicals company INEOS, who were awarded three licence blocks to explore for onshore oil and gas in the midlands. The council has also invested £1.5m of its funds into GDF Suez.
A large area of Somerset has been earmarked for onshore oil and gas exploration, and is currently being assessed by the government until it announces the winners of its second batch of licences in the coming months.
Divest from Fossil Fuels
This information was obtained using the latest data gathered by 350.org, Platform, Community Reinvest, and Friends of the Earth, which unveiled that £14bn of local governments’ pension funds are invested in fossil fuel companies
They hope that this research will boost their campaign efforts to encourage local councils nationwide to divest from fossil fuel companies and get rid of particular stocks, bonds or funds invested in them.
Mika Minio-Paluello, from Platform, said councils should be investing in things that will bring greater benefits to local communities. “When local councils are putting their pension funds into fracking, they are threatening British health and driving climate change. Instead they could create jobs and safeguard pensions by reinvesting into local renewables and social housing.”
Danni Paffard, UK divestment campaigner for 350.org, said, “I’m sure residents and pension holders will be particularly shocked to hear these funds are financially backing the tyranny that is the fracking industry.”
She added, “Choosing fracking is the wrong option for our climate and local communities when we need to be rapidly shifting to renewable energy. Councils – who supposedly have their local residents’ and pension members’ interests at heart, and have the last say on planning permissions – certainly shouldn’t be set to gain from this industry.”