With the opening of the Paris climate talks this week, President Obama joined leaders from 150 other nations to affirm an historic global pivot. The world is moving away from the dirty fossil fuels that drive climate change and toward the cleaner, smarter energy options that can power our future without threatening our kids.
That's a revolution in the way we produce and use energy. It leads toward the low-carbon economy that will ensure future generations a livable world. In Paris, we must accelerate this epic shift with an agreement that puts all the world on the same revolutionary page.
A key part of the transition is to invest our resources in the kind of future we want to create. That's why State Street Global Advisors has developed, with NRDC support, the first publicly traded index fund that invests only in S&P 500 companies that don't own reserves of coal, gas, or oil. The SPDR S&P 500 Fossil Fuel Free Exchange Traded Fund (SPYX) offers a way for anyone to invest in the broad and diversified strengths of the U.S. economyâ--âwithout exposure to fossil fuels.
At NRDC, we shared our environmental goals with State Street and our philosophy about the importance of cutting the carbon pollution that's driving climate change. While NRDC derives no benefit from others' participation, we made a significant investment in State Street's new vehicle, because it supports our core mission.
That's important. We can't afford the damage, destruction, and hazard that come with producing, shipping, and burning the world's coal, gas, and oil.
The science tells us, in fact, that we can burn only one-third of the world's known fossil fuels without driving average world temperatures 2 degrees Centigrade warmer than preindustrial levels, triggering the worst impacts of climate change. That means two-thirds of the world's known fossil fuel reserves will have to stay in the ground if we're to leave our children and grandchildren a livable world.
The fossil fuel industry is destroying vital habitat on land and in the seaâ--âpolluting our air, contaminating our water, throwing our climate into chaos, and pushing the planet to the brink of catastrophe. This needs to change, and as more and more people are concluding, we have a moral obligation to help advance that change.
In fact, two groupsâ--â350.org and Divest Investâ--âannounced Wednesday in Paris that in little more than a year, institutions that together control more than $3.4 trillion in assets have pledged to cut or eliminate their exposure to coal, gas, and oil companies. We're talking here about more than 500 institutions: public and private pension funds, universities, faith-based organizations, independent foundations, and others.
That sends a clear market signal. It's a powerful vote of no confidence in the dirty fuels of the past. It assigns real value to our obligation to protect future generations from the growing dangers of climate change. And it affirms the promise of the climate revolution that means real prosperity, genuine security, and a healthier future for our children.
Investment is about the future. It's about what we expect to happen and what we want to happen. Fossil fuels have become a reckless gamble we can't afford. It's a bet on the very wrong horse.
We need to move away from the dirty fossil fuels of the past to the cleaner, smarter energy options of the future to ensure a brighter tomorrow for our children. That's what the climate revolution is all about.