STOCKHOLM – Norway has made a big move toward dropping investments in coal companies by its massive $900 billion sovereign wealth fund because of their impact on climate change.
Under new rules to be presented by Parliament's finance committee on Thursday, the fund — also known as the oil fund — would exclude companies that get at least 30 percent of their revenue from mining coal or burning it.
The decision is expected to be formally approved by the full Parliament on June 5 because both government and opposition parties are behind it.
"Coal is by far the biggest source of greenhouse gases, so this is a big victory for the climate," said committee member Torstein Tvedt Solberg of the opposition Labor Party.
The move was welcomed by environmentalists who have estimated the fund's coal holdings at about $11 billion. It wasn't immediately clear how much of those investments would be affected.
"We expect that billions of euros will be withdrawn from the coal industry, when this happens," said Truls Gulowsen from Greenpeace. "This is a huge win for the divestment movement and a real sign of hope that investment patterns can be changed."
The World Coal Association, which had advised the fund against divesting from coal, didn't immediately return calls seeking comment.
Norway uses the fund to set aside income from its offshore oil and gas exports, as a buffer for when the country's hydrocarbon resources dry up. The fund has an ethics council that routinely excludes companies over human rights, labor and environmental concerns.
By excluding coal companies, the fund would join a growing divestment movement targeting fossil fuels, the burning of which results in carbon emissions that scientists say are heating the planet.
The finance committee didn't follow the advice of an expert group that recommended using the fund's influence as a shareholder instead of divestment from coal companies.
Committee member Tom Holthe said he and his right-wing Progress Party, which is in a coalition government with the Conservatives, wanted to stick with the expert group's advice, but in the end agreed to the 30-percent limit to avoid an even lower bar proposed by other parties.
"This is the best result you could get," he said, adding that the new rules would be part of the government's next budget and take effect on Jan. 1, 2016.