The climate crisis is disrupting more than ecosystems, economies and societal infrastructure. It’s inverting the normal developmental progression from youthful optimism to an acknowledgment of limitations with advancing age.
Older people – with diminishing life prospects – were once most at risk of losing hope.
Now it is young people.
That harsh reality makes it especially important that Maine recently enacted LD 99, “An Act to Require the State to Divest Itself of Assets Invested in the Fossil Fuel Industry.” Maine is the first state to adopt this mandate through legislation, and its significance extends far beyond aligning the state’s financial investing with its ambitious climate goals.
“LD 99 gives my generation a chance at hope,” testified 15-year-old Emma Drown of Saco. Her most fervent hope “is for a future where the looming threat of climate disaster is not a constant thought in my mind.”
Passage of this law helps lead the way toward that brighter future, and it may convince more Maine youth that – in one’s words – “you shouldn’t lose hope no matter how young you are.”
‘How important and powerful youth voices can be’
Fossil fuel divestment efforts are gaining momentum globally, and their impact goes beyond withdrawal of financial support. “At the end of the day, it’s all about sending a message,” said Cassie Cain, youth engagement coordinator for Maine Climate Action Now and 350 Maine, that fossil fuels represent “a stigmatized industry that people don’t want to be associated with.”
Momentum for divestment began building in April 2020 at an Earth Day teach-in organized by Maine Youth for Climate Justice (MYCJ), a coalition of youth-led groups, and Maine Youth Climate Strikes. The session targeted both young people and what Cain calls “our main adult support system.”
Activists then wrote letters to MainePERS (the public employee retirement system), which manages a pension fund of nearly $17 billion on behalf of more than 110,000 state and municipal employees, and teachers. Pressure on MainePERS to divest from fossil fuels began in 2013, and in 2014 the Legislature mandated that its investments adhere to “environmental, social and governance” (ESG) factors.
But its response to that stipulation amounted to what many activists concluded was simply “greenwashing.” As of December 2020, MainePERS still had $1.27 billion, nearly 8 percent of its assets, in energy and utility sector holdings.
Youth activists found an ally in Rep. Maggie O’Neil (D-Saco), a third-term legislator and law student who had recently submitted a bill on fossil fuel divestment.
“A wonderful partnership” emerged, according to MYCJ core member Anna Siegel, in which state employees and adults from groups like Sierra Club and Maine Conservation Voters supported youth in doing the research needed to testify and advocate with legislators.
Divestment struck Siegel as an obvious step for Maine because investing in fossil fuels while working to address the climate crisis simply “doesn’t match up.” LD 99 corrects that misalignment in MainePERS and state treasury funds, representing what State Treasurer Henry Beck – who backed the measure – called a “a bold law and a bold statement.”
The bill drew strong support, particularly among state employees, with dozens of people testifying in favor and only two parties submitting opposing testimony: the executive director of MainePERS and an American Petroleum Institute lobbyist.
Its passage into law empowered youth climate activists. “It gives me hope that these legislators are listening to us … and taking action,” said Madison Sheppard, a core member of MYCJ. For her and her peers, it was a resounding affirmation “of how important and powerful youth voices can be.”
Better oversight of MainePERS investments
Testimony for LD 99 came from Mainers at both ends of the age spectrum, with students and seniors alike noting that state employees should not be made complicit in funding climate upheaval through their retirement system. As Mary Dunn of Whitefield, a retired teacher, wrote in testimony, “we cannot say that as a profession, we are stewards of the youth while continuing to support the industry that is causing so much harm to our planet.”
Nor should pensions of state employees be threatened by underperforming fossil fuel stocks. Last year MainePERS lost $27.8 million of the $30 million it invested through a private equity fund in a troubled Virgin Islands oil refinery. And that was not an isolated loss. In the six years preceding the pandemic, the fund lost $1 billion on fossil fuel investments over a period when the S&P 500 gained 148 percent.
MainePERS should go beyond its legal mandate to divest from fossil fuel funds; it should reinvest a portion of those funds in Maine through the newly created Clean Energy and Sustainability Accelerator (known in other states as a “Green Bank”). A collaboration between MainePERS and the Accelerator could yield dependable financial returns for the retirement fund while offering tangible benefits for Maine residents through energy-efficiency loans that make their homes cheaper, and cleaner to heat and cool.
Maine has a unique opportunity, not just to lead the nation in turning from fossil fuels, but to pioneer ways to actively nourish a more regenerative and just economy.
Just the opening act
Young activists have no intention of letting Maine miss this opportunity. “My generation and those younger are going to pay for everything that our leaders don’t do to mitigate the climate crisis,” O’Neil said.
Their message to elected officials, Cain said, is “we’re here, we’re watching” to see who supports and who obstructs “a lot of the change we need to see in Maine.” They intend to hold the MainePERS board accountable for enforcing the new law, and stand ready to assist in other divestment efforts around the state and nation.
Attention will likely turn now to the University of Maine System, encouraging its board of trustees to fully divest of fossil fuels investments. (In 2015, its endowment and operating fund divested of coal but not its pension fund). According to data shared by Dan Demeritt, UMS executive director of public affairs, the university has reduced its percentage of fossil fuel holdings significantly through ESG screening since 2014 (see PDF page 33 of this document), bringing it to 1.9 percent of total funds in the pension and endowment, and 1.3 percent in the operating fund. With $440 million in endowment, $25 million in its pension fund and $291 million in its operating fund as of May 30, that leaves roughly $12.7 million still invested in fossil fuels.
Students like Charles Cooper, who leads DIVEST UMS at the Orono campus, anticipates that “passage of LD 99 will be very significant in the UMS divestment effort,” noting that the university should be divesting as a matter of fiduciary responsibility. His testimony for LD 99 cited the lackluster performance of fossil fuel stocks, the explosive growth in electric vehicle manufacturing and other indications that, in his words, “The future of energy is renewable. If it is not, there is no future.”
That realization is hitting more investors, legislators and institutional leaders daily. Thanks to the efforts of youth climate activists and the passage of LD 99, Maine can lead this transition to a more just and sustainable future. In Maine, we’re accustomed to “taking little leaps and leading by example,” said Sheppard. “We can be the one to dip our toes into the water and say ‘hey, it’s fine, it’s going to be OK.’”