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Ontario municipal pension fund divesting major fossil fuel assets

August 09, 2022

Corporate Knights:

As the burning of fossil fuels presents us with yet another summer of catastrophic impacts, the pressure is growing for institutional investors to either phase out their oil, gas and coal and pipeline assets or explain how they’re aligned with a safe retirement future for pension members like us. Are pension funds starting to hear beneficiary concerns and beginning to reduce their high-carbon exposure? 

For our pension fund, Canada’s seventh largest, the answer appears to be yes. Ontario’s $121-billion pension fund for half a million municipal employees, OMERS, announced in July that it’s selling its stake in the largest gas-fired cogeneration plant in the United States. The sale marks the third time in the last year that OMERS has divested a major fossil fuel asset. 

Since late 2021, OMERS has announced it would sell its 25% stake in Scotia Gas Networks (SGN), the second-largest gas distribution network in the United Kingdom, as well as its 80% joint stake in GNL Quintero, Chile’s largest fossil gas import terminal. Meanwhile, regulatory filings show that OMERS has reduced its holdings in publicly traded fossil fuel companies by 3 million shares, or about 17%, since June 30, 2021. 

As pension plan members, we’ve been asking OMERS to either demonstrate how its fossil fuel assets have credible decarbonization pathways or divest them. And OMERS might finally be listening. 

[Paul Burns, Aislinn Clancy and Melissa Rosato]

More: Is one of Canada’s largest pension funds quietly divesting from fossil fuels?

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