The decision to prevent KiwiSaver default funds from investing in fossil fuels is virtue-signaling hypocrisy and won’t have any impact on emissions according to New Zealand’s minerals sector industry organisation, Straterra.

“We support moves towards a low carbon economy and the transition out of fossil fuels but the key to reducing emissions from fossil fuels is to reduce demand. This decision does nothing to address this. It just reduces the pool of assets KiwiSaver funds are able to hold,” said Straterra CEO, Chris Baker.

“Will KiwiSaver funds be prevented from investing in companies that use fossil fuels? Transport, industry, energy construction and just about every other sector are dependent on fossil fuels in one way or another.

“The motorist filling up their car is not being penalised but the companies that enable them to do that are. It is dishonest to demonise fossil fuel producers and put fossil fuels in the same category as illegal weapons when people are happily using fossil fuels every day. It is also dishonest to give New Zealanders the impression that decisions like this are having an impact when they are not.

“In the case of coal, coal producers mine coal to meet demand from New Zealand and abroad.

“Domestic demand comes from the agricultural sector, steel manufacture, generation of electricity at Huntly (as a back up to our renewable resources to maintain security of generation), and to a minor extent to heat schools and hospitals mostly in the South Island where reticulated natural gas is not available.

“Reducing emissions from fossil fuels will occur as mechanisms such as the newly strengthened Emissions Trading Scheme runs its course and competitiveness and cost burdens allow.

This decision is a distraction from genuine steps to reduce emissions and it pre-empts the more considered and evidence-based approach the Climate Change Commission is pursuing” Mr Baker concluded.

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