Oregon is set to make strides in the climate resilience arena with the recent passage of House Bill (HB) 2081A, better known as Oregon’s Climate Resilience Investment Act. Applauding the bipartisan effort, State Treasurer Elizabeth Steiner heralded it as a significant step in redefining investments in clean energy, as reported by Oregon State Treasury's recent post. The bill, which awaits Governor Kotek's signature, encourages the Oregon State Treasury (OST) to tap profitable investments that could not only bolster the state's environmental initiatives but also secure the future of the Oregon Public Employee Retirement Fund (OPERF).
With an eye on the global market's shift to sustainable practices, the Act is structured to benefit from the clean energy transition. Making up approximately 3.7% as of 2021, investments in fossil fuels within OPERF's impressive $101 billion managed assets don't represent a significant percentage. "The Climate Resilience Investment Act is a clean energy investment law, not a divestment mandate," Treasurer Steiner expressed in a statement obtained by the Oregon State Treasury, emphasizing a proactive approach to climate-positive financial strategies.
The legislation will require OST to generate routine reports for the legislature while selecting investment options that ensure the fund's longevity in an increasingly climate-aware market. The State Treasury, managing the 17th largest retirement fund nationally, is taking seriously its fiduciary responsibility to the pensioners, providing an example that labor unions and business leaders have rallied behind.
"Hard-working public employees deserve a stable, secure, and healthy future," said Mike Powers, political and policy strategist at SEIU Local 503, as he spoke about the legislation, which is reported to generate 70% of every dollar for Oregon’s public agency retirees. OPERF's previous engagement with fossil fuels raised concerns about potential long-term investment losses and its effects on the services and programs that budgets from state and local agencies, including school districts, support.
Treasurer Steiner's push for a stronger emphasis on responsible clean energy investments also garnered positive reinforcement from the business sector. Tim Miller, director of Oregon Business for Climate, highlighted the inevitable shift towards a carbon-free economy. "The world is moving toward a carbon-free future and it's not turning back. That creates opportunities for innovation and growth for companies and investors who are able to adapt," Miller told the Oregon State Treasury, backing the Act's foresight in aligning with market transitions away from carbon risks.
The passage of the Climate Resilience Investment Act promises to place Oregon in the vanguard of progressive climate investment legislation, closely watched by other states contemplating similar measures. With a commencement date 91 days post-passage, the implications of this law for public employees' retirement plans and the broader fight against climate change await to be seen.
