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Finance & Innovation

New York Is Divesting $5 Billion From Fossil Fuels

Rising sea levels threaten to submerge large swaths of New York City over the course of the century, causing billions of dollars in damage and potentially displacing entire communities.  

As a result, city leaders have crafted one of the most ambitious action plans for cutting emissions and adapting to climate climate in the US.

Now New York is going one step farther.

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Mayor Bill de Blasio announced on Wednesday that the city’s pension funds will divest the $5 billion it currently has invested in fossil fuel companies, which makes it the largest municipal divestment campaign in US history.

"New York City is standing up for future generations by becoming the first major US city to divest our pension funds from fossil fuels,” said Mayor de Blasio during a press conference.

The mayor also announced a lawsuit against five oil companies that the city’s lawyers allege have downplayed the risks of climate change while being the primary drivers of the problem.

Read More: San Francisco Sues Oil Companies for Billions to Pay for Sea Level Rise Protection

“We’re bringing the fight against climate change straight to the fossil fuel companies that knew about its effects and intentionally misled the public to protect their profits,” he said in his statement.

“As climate change continues to worsen, it’s up to the fossil fuel companies whose greed put us in this position to shoulder the cost of making New York safer and more resilient,” he added.

Exxon Mobil, which is one of the companies being sued, has called similar lawsuits a “conspiracy,” driven by “opportunistic politicians,” according to the Guardian.

The lawsuit ultimately aims to get these companies to pay for damages incurred from the effects of climate change, including rising sea levels, which are set to cost New York billions of dollars in infrastrastructure damages in the years ahead, according to the press release.

Throughout the world, around $6 trillion has been divested from fossil fuel companies by 810 institutions, largely because of pressure from environmental activists and concerned citizens.

Read More: The Catholic Church Is Getting Out of Fossil Fuel Investing

New York joins other US cities such as Washington DC that have already begun divestment campaigns, according to The Guardian.

The point of divestment is to show that fossil fuels are no longer a viable investment, according to the environmental group 350.org. By pulling funds from these companies, institutions signal to the world that the costs of climate change outweigh financial gains from their continued extraction and use.

Divestment is also a moral and ethical decision, 350 argues. As climate change threatens countries around the world with environmental ruin, many organizations view the continued use of fossil fuels as unjustifiable.

Global Citizen campaigns on the Global Goals, which call for the end of fossil fuel use. You can take action on this issue here.

“New York City is now leading cities and states to not only divest from fossil fuel companies but also insist that the corporations that profit from destabilizing our shared planet pay for the mess they knowingly created,” Naomi Klein, author and activist, said in a statement.

Read More: Major Climate Change Lawsuits Expected to Make Splash in 2018

“As of today, the entire fossil fuel sector finds itself under a cloud of huge potential court-imposed costs, as well as the growing global momentum of investor flight,” she added.