Our analysis, based on the 2016 financial year and using a list of the world’s 200 biggest extractors of fossil fuels, shows that Scottish councils currently invest £1,683 million in fossil fuels, 4.8% of the total value of the scheme.
£637 million of this was directly invested by councils, of which £543 million is invested in oil and gas and £113 million in coal. As a handful of companies are both oil, gas, and coal operators these numbers have some overlap. The majority of the funds that councils hold in fossil fuels, £1,046 million, is invested through intermediaries.
The total figure represents a £3,300 stake in fossil fuels for every member of the local government pension scheme.
Friends of the Earth Scotland previously published an analysis of data from the 2015 financial year and found that Scotland’s local councils were investing £1,664 million in fossil fuels.
Our new analysis includes more data and uses a more sophisticated method of estimated indirectly held funds. Nonetheless the comparison between these two totals is remarkable. Whilst global governments signed a UN treaty on climate change, described by First Minister Nicola Sturgeon as a “historic agreement [that] sends a signal of certainty about the global economy’s low carbon future” and by others as “heralding the end of the fossil fuel age”, Scotland’s local governments continued to invest heavily in the companies most responsible for climate change.
BHP Billiton is one of the world’s largest mining companies and 12th largest extractor of coal globally. It has been listed as one of the companies most singularly responsible for climate change. The company is currently mining in the centre of the Borneo rainforest and is facing prosecution over Brazil’s worst ever environmental disaster, when a dam holding back waste water from an iron ore mine broke in 2015. The company is accused of bribery in the US and China. Samuel Arregoces (pictured) was evicted from his home to make way for the expansion of one of the world’s largest open-cast coal mines, a joint venture of BHP’s in Colombia. He came to Scotland in 2015 and said “the story of coal mining in Colombia has been 30 years of destruction, 30 years of pain.” Scottish councils invest £19.5 million directly in BHP Billiton.
BP are a supermajor, one of the world’s six largest non-state owned oil and gas companies. Fleetingly branding themselves beyond petroleum they have shed their renewable businesses in recent years in favour of new investment in deep sea and arctic drilling, highly-polluting tar sands developments, and fracking. BP have campaigned against subsidies for renewable energy and have close ties with the oppressive regime in Azerbaijan. They were fined $18.7 billion, the largest environmental fine in US history, for the “gross negligence” regarding the 2010 Deepwater Horizon spill which devastated the Gulf of Mexico. Scottish councils invest £64 million in BP.
Fossil fuel investments by council pension fund
|Fund name||Fund value
|Direct in Oil and Gas||Direct in Coal||Direct in Fossil Fuels||Indirect in Fossil Fuels||Total in Fossil Fuels||%|
|Dumfries & Galloway||692,148||20,611||–||20,611||49,877||70,488||10.2%|
Note that although some councils manage their pension fund not just for their own council area but also on behalf of neighbouring areas, namely:
- Falkirk operate their pension fund on behalf of Stirling and Clackmannanshire.
- Highland operate their pension fund on behalf of Comhairle nan Eilean Siar (Western Isles).
- Lothian is operated by the City of Edinburgh Council on behalf of East Lothian, West Lothian and Midlothian.
- North East is operated by Aberdeen City Council on behalf of Aberdeenshire and Moray.
- Strathclyde is operated by Glasgow City Council on behalf of East Ayrshire, North Ayrshire, South Ayrshire, North Lanarkshire, South Lanarkshire, Renfrewshire, East Renfrewshire, Inverclyde, East Dunbartonshire, West Dunbartonshire and Argyll & Bute.
- Tayside is operated by Dundee City Council on behalf of Angus and Perth & Kinross.
Top 10 fossil fuel companies
|Company name||Amount Scottish councils have invested (£ ‘000)||Company description||Local government pension fund investors|
|Royal Dutch Shell||129,936||Oil and gas company||Lothian, Highland, Fife, Strathclyde, Tayside, Falkirk, Orkney, North East, Dumfries & Galloway, Scottish Borders|
|Rio Tinto||74,107||Coal company||Strathclyde, Orkney, Scottish Borders, Fife, Highland, Tayside, Lothian, North East|
|BP||63,977||Oil and gas company||North East, Strathclyde, Falkirk, Tayside, Lothian, Highland, Dumfries & Galloway|
|Exxon Mobil||44,008||Oil and gas company||Strathclyde, Highland, Lothian, Fife|
|EOG||40,661||Oil and gas company||Scottish Borders, Orkney, North East, Strathclyde, Falkirk, Tayside, Highland, Fife, Lothian|
|Eni||31,474||Oil and gas company||Strathclyde, Lothian|
|Centrica||27,964||Oil and gas company||Fife, Lothian, Falkirk|
|Total||25,783||Oil and gas company||North East, Lothian, Tayside, Highland, Strathclyde|
|Apache||20,047||Oil and gas company||Scottish Borders, Strathclyde, Tayside, Highland, Lothian, Fife, Orkney|
|BHP Billiton||19,467||Oil, gas, and coal company||Orkney, Scottish Borders, Fife, North East, Falkirk, Tayside, Highland, Falkirk|
A complete list of fossil fuel companies which have received investment from Scottish council pension funds along with our methodology is listed here.
 Local Government Pensions, Fossil Fuels, and the Transition to a New Economy (2015): http://reinvest.scot/wp-content/uploads/2016/09/Local_Government_Pensions_and_Fossil_Fuels.pdf
 Data obtained from the Carbon Underground 200, correct as of 16 March 2016.
 Read more about BHP Billiton on the Friends of the Earth Scotland blog: http://www.blog.foe-scotland.org.uk/index.php/2015/12/where-your-money-goes-the-toxic-toll-of-bhp-billiton-in-borneo-and-colombia/
 For more information about BP read the Friends of the Earth Scotland blog: http://www.blog.foe-scotland.org.uk/index.php/2015/11/where-your-money-goes-bp-corruption-spills-and-gross-negligence/