Does the Council’s zero carbon policy depend on ‘green’ profits for investors?

Birmingham Council has a new in-house Climate Change team, led by Ellie Horwitch-Smith, Assistant Director. She explained at the Council’s Sustainability and Transport Overview and Scrutiny Committee meeting on 17 November that she is currently ’Appraising existing and proposed council projects’.  The theme of her presentation was the need to attract private investment.

‘We know that there’s obviously a limited capability and set of funds available in the public sector, and I think that what is also clear to me from the work that I’ve done In engaging with private sector investment through the Green Finance Institute is just the scale and appetite to invest by the private sector from all sorts of different angles In environmental, social, economically beneficial projects.

So I think what we need to do is make sure that the projects we are bringing forward are investment-ready In terms of the clear outcomes they are achieving, what are the things that investors want to see as being outputted from the investments they make. And if we start to design that information Into the projects that we’re making from the start then we’ll have a much better chance of making them investment-ready.’

Ellie Horwitch-Smith has just joined the Council from the Green Finance Institute, which states that ‘We are an independent, commercially focused organisation backed by government and led by bankers.’

‘Our vision is a greener future made possible by finance. Our mission is to accelerate the transition to a clean, resilient and environmentally sustainable economy by channelling capital at pace and scale towards real-economy outcomes that will create jobs and increase prosperity for all.’

During COP26 ‘The Green Finance Institute is partnering with the City of London Corporation to co-host the Green Horizon Summit, a five-day hybrid event to mobilize private finance in the transition to net zero’.

Note: this is not zero carbon, it ‘carbon neutral’, which means net zero. As three leading climate scientists said recently, “the idea of net zero has licensed a recklessly cavalier “burn now, pay later” approach which has seen carbon emissions continue to soar”. [1]

Of course Ellie Horwitch-Smith is right to say that there isn’t nearly enough public funding. But is she right to say that the strategy for the Council should be to rely on investment in Council climate projects for profit – and more profit than they can make elsewhere – by the private sector?

The WM Local Govt Pension Fund

The answer was given in a second presentation at the Council’s Scrutiny meeting, by Rachel Brothwood, Director of Pensions at the West Midlands Pension Fund. Birmingham Council’s policy since 2017 has been to divest from fossil fuels by 2030. This includes the West Midlands Local Government Pension Fund. But the Fund still invests in fossil fuels. Rachel Brothwood, explained why:

‘There are no credible pathways for investors at present that lead to net zero.’

In other words, without investment in fossil fuels the Pension Fund would not deliver enough profit for finance capital to invest in it.

This strategy of reliance on investment for profit by the private sector has failed to deliver zero carbon for the Pension Fund. It will also fail to deliver for the Council’s own Route to Zero 2030 Climate Action Plan.

As Ben Davies says in ‘We Can’t Save the Climate Without Class War’ in this week’s Tribune:

‘people see through this thinly-veiled attempt by capital to open up new markets for ‘sustainable’ or ‘eco-friendly’ consumption—a gentler, greener capitalism. …a wealth tax on the super-rich would rightfully redistribute the enormous sums that they currently hold in tax havens and in stocks.

Meanwhile, multilaterally banning climate-intensive investments in fossil fuels, deforestation, and other destructive projects which only serve to generate passive income for the wealthy (not just billionaires) would curtail the ability of private investment to continue destroying the planet. Rather than a cosy relationship between labour and capital predicated on ‘green investment’, these measures should be a baseline to build from and the beginning of a transformation in class relations internationally, disempowering capital and giving workers the tools to manage the greened economy on their own terms, rather than for the benefit of the privileged few.’ [2]

What does this mean for the Council?

Of course it will need external investment to make up for the lack of government funding, provided the private sector isn’t driving the agenda, but that must be in the context of a strategy of public mobilisation in every community in the city for not just government funding to tackle the climate emergency but also for system change:

‘Only the end of capitalism’s endless pursuit of private profit, endless waste and rapacious drive for growth, can provide the solution not only to climate change, environmental degradation and mass extinction, but to global poverty, hunger, and hyper-exploitation.’ [3]

  1. https://theconversation.com/climate-scientists-concept-of-net-zero-is-a-dangerous-trap-157368
  2. https://redgreenlabour.org/2021/11/19/we-cant-save-the-climate-without-class-war/
  3. Ecosocialist Alliance, September 2021.

……………….

On Saturday climate campaigners presented a challenging petition with around 1000 signatures to WM Mayor Andy Street at the WMCA Board meeting – see the video of Bob Whitehead of Climate Action Network WM making the case here:
https://youtu.be/K0c41tPUsR8

 

Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s