ORONO, Maine — A group of University of Maine students and activists gathered outside Fogler Library Friday morning demanding that Maine’s public university system divest itself from investments in companies that deal in fossil fuels.
Some stood on the steps holding signs decrying the effects dependence on fossil fuels has on the environment, while others played dead on a large, black cloth on the lawn that was meant to simulate an oil spill.
Divest UMaine is an offshoot of a larger national movement calling on institutions and endowments to rid their portfolios of investments in the top 200 publicly traded fossil fuel companies.
“It’s students standing up to say, ‘We as students who put our money into this endowment, who you work for, really, are saying that we want our endowment to be divested and reinvested in sustainable solutions and not the destruction of our climate,’” said Connor Scott, a 21-year-old business and international affairs double major speaking on behalf of the group.
“We have a Climate Change Institute,” said Catherine Fletcher, a fourth-year zoology major. “We claim we’re a leader in campus sustainability, but underneath it all we’re investing in the main cause of climate change.”
UMS argues it has been fighting climate change for years by investing in sustainability across its eight campuses. The system has reduced its carbon emissions by 22 percent since 2006, investing millions of dollars into upgraded heating plants, natural gas conversions and public transportation initiatives.
The system’s Investments Committee is slated to discuss whether to divest itself of investments in coal and coal mining companies by having investment managers “negatively screen” for coal when making future investments during a 9 a.m. Dec. 3 meeting at the System office, 16 Central St. in Bangor. Students from UMaine, the University of Southern Maine and other campuses plan to attend. Students from College of the Atlantic and Unity College, schools that already have divested from fossil fuel investments, also are expected to be there.
If the committee approves the divestiture, it will be placed on the consent agenda for the January Board of Trustees meeting. The committee has been studying fossil fuel investments throughout the year with the help of the New England Pension Consultants.
NEPC surveyed the UMS portfolio and measured fossil fuel “exposure,” or the percentage of a portfolio invested in a particular security, in three areas — the managed investment pool, pension fund and operating fund. The MIP has 3.2 percent exposure to fossil fuels, totaling about $8.7 million in investments, with coal exposure accounting for 0.3 percent of the MIP funds. The pension fund has 1 percent fossil fuel exposure totaling $397,000, with 0.2 percent coal exposure. The operating fund has 0.3 percent fossil fuel exposure totaling about $742,000, almost all of it coal, according to the system.
While the divestment of coal would be a start, Divest UMaine argues that the effort should go further — to eliminate all association with all fossil fuels in the system’s portfolio.
“If [divesting coal] is the best we can do, then it’s definitely a step, but it’s a baby step and it’s not really going to do that much,” argued Scott.
The NEPC report cautions that a wholesale divestiture of coal, let alone all fossil fuels — such as oil and natural gas — could have negative effects on the rest of the system’s portfolio, limiting its ability to manage risk, diversify and seek returns.
“When we consider calls to divest completely from fossil fuels, we must also consider our fiduciary responsibility to seek returns on our investments and mitigate risks,” Demeritt said Friday. “Coupled with our campus-based commitment to environmental stewardship, the investment committee will consider if coal divestiture strikes the appropriate balance.”
The NEPC warns that UMS uses mutual funds, commingled funds and limited partnerships in its investments, each of which limit its options to use negative screens to cut its fossil fuel exposure. Such a shift also would mean major changes for each of the plans and require significant staff, committee and consulting resources, according to NEPC.
“Maine’s public universities are taking meaningful steps to reduce our carbon footprint and to reduce energy consumption,” Demeritt said. “All of our campuses are utilizing renewable energy sources and upgrading campus infrastructure, yielding both cost savings and carbon avoidance.”
Follow Nick McCrea on Twitter @nmccrea213.