New York’s $226 billion pension plan will go carbon neutral by 2040

Comptroller Tom DiNapoli said the New York State Pension Fund will invest in “net-zero” carbon emissions by 2040. Photo via office of the New York State Comptroller

By Rachel Vick

New York State’s $226 billion pension plan will get to “net-zero emissions” by 2040, with the potential for fully divesting from fossil fuel companies, Comptroller Thomas DiNapoli announced Wednesday.

DiNapoli said the state has moved to align its pension with the goals established by the Paris Climate Agreement by reviewing each investment and determining whether the company is reducing its carbon emissions.

“New York State’s pension fund is at the leading edge of investors addressing climate risk, because investing for the low-carbon future is essential to protect the fund’s long-term value,” DiNapoli said. 

He said the state will not necessarily divest, but is using the threat of divestment to influence companies’ behavior.
“Divestment is a last resort, but it is an investment tool we can apply to companies that consistently put our investment’s long-term value at risk,” DiNapoli said.

He said his staff assesses companies' preparedness to transition to a clean energy future. Last year, the pension plan divested from 22 coal companies for failing to meet climate goals. 

The plan is currently conducting a review of companies that extract oil from tar sands. They will nexxt review shale and natural gas corporations. 

They assess companies that provide equipment, storage and transportation of oil and gas. 

DiNapoli said the state will make divestment decisions by 2025, and the pension plan will continue to explore sustainable investments by doubling its financial commitment to the Sustainable Investment-Climate Solutions Program over the next 10 years.