Moratorium on PERS Private Investments in Fossil Fuels

Oregon’s investments are at significant risk due to climate change. According to two evaluations commissioned by the State Treasurer, the Oregon Treasury’s current investment strategies create substantial risk to the portfolio. The impacts of the changing climate pose risks to supply chains, threaten property and transportation infrastructure, force insurance companies to pull out of entire geographic areas, and disrupt commodity markets. Private investments comprise approximately 60% of the PERS portfolio and account for about half of its carbon emissions. Because they are illiquid, long term contracts of 10-12 years, and are heavy investors in fossil fuels, their prominence in the portfolio is itself a source of the increased risk to its health. 

The moratorium on long-term private investments in fossil fuels outlined in this 2025 bill will address the urgency to not dig the hole deeper while the Treasury is starting to implement the Treasurer’s Net Zero Plan. With a 5-year moratorium, this bill will ensure legislative accountability and leadership while giving the Treasury time to transition toward a model of investing in a green future, choosing safer investments for Oregon’s public employees. 

This bill codifies a key aspect of the Net Zero Plan. The Treasurer and Oregon Investment Council asked, in their October 2021 letter to the legislature, that it provide this type of guidance. The legislature needs to provide this continuity of investment trajectory, since Treasurers are elected every 4 years.