An American billionaire's descendent has lashed the Australian government for its defence of fossil fuel.
What's surprising is that Valerie Rockefeller Wayne is a descendent of America's first billionaire John D Rockefeller, whose fortune was built on oil – a fossil fuel.
If you've ever wondered why they're called fossil fuels, it's because they are formed from the decomposed organic materials such as decayed plants and animals that convert to oil, coal and gas under immense heat and pressure over hundreds of millions of years.
Ms Rockefeller is the chairperson of the $1.1 billion Rockefeller Brothers Fund, a charity committed to social change. Last year it abandoned its investments in coal companies, joining a growing divestment movement. "This is a global phenomenon and we want to get out of those because we see the fossil fuel investments as risky," Ms Rockefeller told the ABC's Four Corners program, adding, "It is baffling to me why the current Australian Government is stuck in the past rather than looking towards the future and becoming part of the solution."
Prime Minister Tony Abbott recently labelled divestment of fossil fuel investments by investment managers 'stupid'. Mr. Abbott has also strongly defended coal, telling coal miners in NSW in October, "Coal is good for humanity, coal is good for prosperity, coal is an essential part of our economic future, here in Australia, and right around the world."
Mr. Abbott has also made clear his disapproval of some renewable sources of energy such as wind farms, telling broadcaster Alan Jones that he'd prefer there to be fewer wind farms.
But his view appears to be a single voice in the wilderness.
Last week, the G7 group of industrial nations agreed to give up fossil fuels by the end of the century. Just weeks ago, Norway's Sovereign Wealth Fund, one of the largest in the world, announced that it would divest investments from companies earning more than 30% of their income from coal. Incidentally, Norway's Wealth Fund was founded on the riches of Norway's oil resources.
Late last year, Australian National University (ANU) announced it would blacklist seven resource stocks, and exclude them from its $1.1 billion investment portfolio, including some for their reliance on fossil fuel earnings. Those companies include Santos Ltd(ASX: STO), Sirius Resources N.L. (ASX: SIR), Iluka Resources Limited (ASX: ILU) and Sandfire Resources NL (ASX: SFR).
While the rest of the world is preparing to end the use of fossil fuels, particularly coal, it seems Australia is headed the other way. Coal is still a major export earner for Australia, bringing in $39.8 billion in 2013, ranking second behind iron ore, while natural gas exports came in fourth with $14.6 billion in exports and petroleum exports at 7 with $9 billion.
Clearly, stopping these industries or clamping down on the export of fossil fuels would present a major headache to Australia's economy. But we may not even have any choice. Countries like China which import our coal, are cutting back on the use of the fossil fuel as an energy source while prices for coal have fallen dramatically.
An investment in Australia's coal companies over the past five years has been a disaster. Whitehaven Coal Limited (ASX: WHC) has sunk 68%, New Hope Corporation Limited (ASX: NHC) has lost 55%, Yancoal Australia Ltd (ASX: YAL) is down 88% and Cockatoo Coal Limited (ASX: COK) has lost an astonishing 99.6% of its market value.
Maybe it's time to face facts.
