Councils should stop investing their pension funds in fossil fuels and direct their capital towards renewable energy instead, the Green Party has said.
London mayoral candidate Sian Berry said councils were being short-sighted by channelling money towards technology that would likely be replaced and that contributed to climate change.
She said that Green Party members on the London Assembly would push the city's boroughs towards investing in renewable energy.
Councils and other public authorities tend to have large pots of money from pension contributions that they invest in various projects and schemes. The yield from these investments is added to the pot, from which pensions are paid.
The London Assembly already has voted to divest City Hall’s £4.8bn pension fund from fossil fuels, a measure supported by the greens and other parties.
“Pensions are all about the future and fossil fuels are an incredibly short-sighted investment all public pensions should avoid,” Ms Berry said.
“Investing in new green industries would help get London’s economy ready for the long term, creating jobs that benefit local communities and greater resilience at a time when our city is increasingly vulnerable to the changing climate.
“Divestment would move public sector pension investments away from industries and fuels of yesterday, and help end our long standing dependence on fossil fuels. It would help to boost London’s contribution to tackling climate change too, where we have the potential to lead the world.”
Other councils have had some success directly investing in renewable energy projects. Lancashire County Council has previously invested £12m into a large community-owned solar power station that now yields it and other in the local community a profit.
Council pension funds have also been reported to have invested millions in a dedicated offshore wind fund established by the Government’s Green Investment Bank.
The campaign group Go Fossil Free says UK local government invests a total of £14bn of pension money in fossil fuels, with Greater Manchester and Strathclyde’s pension funds investing the most.
Ms Berry was selected as the Green Party candidate for mayor of the capital earlier this year. Sadiq Khan has been selected as the Labour candidate, with the Conservative candidate yet to be officially determined.
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