Ireland is set to become the first country to divest from fossil fuels, according to NPR. The bill was passed by the Dail, Ireland’s lower house of parliament and after the bill was issued, it requires its sovereign wealth fund to sell off its holdings in fossil fuel industries “as soon as practicable.”
Moving forward the bill which was issued on Thursday, 12th of July, 2018 would need to the country to divest its $10 billion – sovereign wealth fund from natural coal and gas. It is important to know that the bill also be moved to the upper house of the parliament, the Seanad, in September. Ireland’s move follows the recent intents by the Norwegian Sovereign wealth fund to reduce its exposure to coal.
“The divestment movement is highlighting the need to stop investing in the expansion of a global industry which must be brought into managed decline if catastrophic climate change is to be averted. Ireland by divesting is sending a clear message that the Irish public and the international community are ready to think and act beyond narrow short term vested interests.” These were the words of Thomas Pringle, the independent Member of Parliament who introduced the bill, to The Guardian.
Based on the new regulations, the Ireland Strategic Investment Fund which has $10 billion, government stakes in AIB, and also the Bank of Ireland will be restricted from investing in any company that get more than 20% of its revenue from fossil fuels.
Since June 2017, the fund was exposed to 153 fossil fuel companies through debt and equity holdings of about 288m Euros, according to statements from ISIF officials.
On Wednesday, the Ireland Strategic Investment Fund addressed the parliament that it was “well advanced” in selling down its worldwide portfolio of fossil fuel and had already omitted about 16 companied that work on oil and gas shores.
Furthermore, the bill that was passed on Monday exempted fossil fuel investments that are deemed to be in line with Ireland’s climate goals, and also omitting for investments in hedge funds or exchange traded funds – which were measure that were included to decrease the effect of the bill after it was introduced 2 years ago.
“We have had a very carbon-based economy and society for a number of years, so this is a huge change for us, but it has to happen.” This was said by Pringle.
Pingle stated that the changed been made on the bill was created to permit investments in facilities such as natural gas plants that may be part of the transition from fossil fuels to low-carbon fuels.
The ISIF invests in debt and equities, and also directly in projects and industries, ranging from real estate development to technological start-ups.
It is important to know that the recent bill was voted by the Seanad, and as stated earlier, the bill will be passed in the autumn – around September.
Ireland’s decision to transit from the use of fossil fuels is a great victory for the movement against the use of fossil fuels around the world. The fossil fuel movement has convinced universities, churches, pension funds, and major cities like New York to dissociate trillions of dollars, but this movement have never stirred an entire country before.
The country that first acted to this movement but stopped along the way was Norway. Its central bank recommended that it divest its sovereign wealth fund from oil. But there hasn’t been any country that has divested from all fossil fuels before now.
“Ireland’s decision to divest from fossil fuels staggers me. It’s one of the landmark moments in what has become the largest campaign of its kind in history. Such thanks to all who fought,” according to the divestment movement leader and 350.org founder Bill McKibben in his tweet on Thursday.
Ireland’s big step is a major achievement due to the fact that the country was ranked last among EU countries in the 2018 Climate Change Performance Index.
However, according to Eamonn Meehan, the executive director of the Irish Catholic organization Trocaire that campaigned for the bill said, “Ireland has gained a reputation internationally in recent years as a ‘climate laggard’… so the passing of this Bill is good news but has to mark a significant change of pace on the issue,” in a statement reported by NPR.
However, it is also necessary to keep at heart that Ireland is poised to lead other countries in the fight against climate change. Also, as it stands now, it is the country leading the movement against the use of fossil fuels.
“Governments will not meet their obligations under the Paris agreement on climate change if they continue to financially sustain the fossil fuel industry. Countries over the world must now urgently follow Ireland’s lead and divest from fossil fuels.” These were the words of the bill drafter Gerry Liston of Global Action Network to The Guardian.