Climate Pension Quarterly - Issue #19
Abundant renewable energy can get us off the volatile fossil fuel rollercoaster
An unfolding war across the Middle East has gripped the world’s attention since the United States and Israel attacked Iran. Canada’s globally-connected population fears for friends and family in multiple countries, anxious for updates and mourning lives lost.
Across global markets, the volatility has created a fossil fuel supply shock, sending oil and liquified natural gas (LNG) prices skyrocketing.
How should our pension fund managers make sense of this? And what can pension members do to ensure that their pension funds don’t use short-term crises to back away from long-term climate commitments - commitments that are foundational to pension funds’ ability to provide pensions in the future?
Pension managers invest for the long haul, which should leave them clear-eyed to what’s happening here. The oil and gas industry has never missed an opportunity to use a geopolitical crisis to scare governments and the public into believing that increased production is the answer. But in 2026, this argument is flimsier than ever.
We saw this play out four years ago, when Russia invaded Ukraine. Industry pushed to expand fossil fuel infrastructure as oil and gas prices spiked across Europe. But for one of the first times since the fossil fuel era began, countries had better options. Four years later, experts have recorded a major acceleration in renewable energy and battery projects across Europe, along with a big decline in gas demand. Less wealthy countries, such as Pakistan, saw a rapid uptake in solar and battery installation from households and businesses, reducing dependence on expensive imported fossil fuels.
As noted by Akshat Rathi in his Bloomberg article, How Fossil Fuel Disruptions Lead to Booms in Solar and Batteries, we now live in an era of cheap and abundant renewable energy technologies that can be deployed quickly.
With the fragility and volatility of global oil and gas supply chains once again on display, we can expect countries of all income levels to work harder to get off the oil and gas rollercoaster and secure their energy futures with cheap renewable energy and battery storage.
Institutional investors should look beyond the short-term noise. Flexible renewables-based energy systems are resilient to conflict, are already displacing fossil fuels, and are the growth curve of the future. This energy shock will speed up the global decline of oil and gas.
But while this long-term truth holds, current events are making Canada’s political, media, and business establishment especially susceptible to oil and gas spin.
That’s why right now is such an important time for pension plan members to reach out to their pension managers.
Oil and gas-based energy systems are bringing us ever closer to a world of heatwaves, wildfires, droughts, super-storms, runaway inflation, and even more geopolitical conflict. In such a world, our pension funds will not be able to generate the returns we’re counting on to pay our pensions or enjoy a dignified retirement.
But pension fund members are raising their voices.
Last month, when the Canada Pension Plan Investment Board held public meetings in Calgary and Edmonton, questions about the climate crisis and the pension fund’s fossil fuel investments dominated the Q&A. Read Shift’s recap here.
When the Ontario Teachers’ Pension Plan tried to dial back its climate commitments with its climate strategy update in February, Shift almost immediately began hearing from concerned retired and working Ontario teachers. See Shift’s media statement here.
And when we hosted our webinar, Widening Divide: Canadian Pensions at a Climate Crossroads, hundreds of people registered. Watch the webinar recording here.
Take a moment to let your pension fund know what’s at stake.
Canada-wide: Demand climate action from the Canada Pension Plan
British Columbia: Ask the British Columbia Investment Management Corporation to protect our futures
Ontario municipal employees: Tell OMERS to keep up its climate momentum
Ontario healthcare professionals: Tell HOOPP a healthcare pension should be healthy for the planet
Federal public servants: Tell PSP to protect your pension and the planet
At Shift, we’ll continue to draw the links between a worsening climate crisis and our collective retirement security, including through our fourth annual Canadian Pension Climate Report Card, released in January; by continuing to share news about our national pension manager (stay tuned for this quarter’s CPPIB Watch, coming soon); and through this edition of the Climate Pension Quarterly.
Click into the Quarterly to see a few of the stories we followed over the past three months.
Thank you,
-Laura McGrath, Senior Manager, Shift