by Stuart Blood
Stuart is an organizer and volunteer with the Upper Valley Affinity Group
We have our work cut out for us convincing the Treasurer, Vermont Pension Investment Committee, and legislature to divest Vermont’s three pension funds from fossil fuels. Meanwhile, there’s another pile of the public’s money pouring into a dirty fossil fuel cash pipeline. Vermont deposits most of its money into TD Bank. TD Bank is part of the TD Bank Group and has $1.1 trillion in assets (CDN).
TD’s Dirty Investments
At the end of 2014, TD Asset Management and Toronto-Dominion Bank together owned almost $2 billion in TransCanada stock, making TD the second-largest shareholder in the company that wants to build the Keystone XL pipeline. Through those holdings in TransCanada, TD also invests in the Energy East pipeline network. When built, that pipeline will, every day, carry 46 million gallons of crude oil extracted from tar sands deposits in Alberta eastward through Ontario, Québec, and New Brunswick.
But, wait… TD’s investments in fossil fuels do not by any means bypass us here in Vermont.
TransCanada also owns the gas mainline that runs east from Alberta to the Québec/Vermont border, delivering the fracked gas that flows through the Vermont Gas Systems (VGS) pipeline to Burlington. VGS has a permit from the Vermont Public Service Board (PSB) to extend the pipeline to Middlebury. (Resistance to this expansion is fierce. The PSB is expected to reconsider the permit, especially in light of huge cost increases and the cancellation of VGS’s controversial “phase 2” plan to extend the pipeline under Lake Champlain to Fort Ticonderoga, NY.)
TD is also the third-largest shareholder in Enbridge, the company that owns the pipeline that ruptured and caused a catastrophic spill of tar sands crude oil – extremely toxic “diluted bitumen” – into the Kalamazoo River in Michigan in 2010. The cleanup costs from that spill have exceeded $1 billion so far. Valued at $66 billion, Enbridge is the third-largest North American pipeline company. TD’s investment in the company is $2.3 billion.
Enbridge is an owner of Vermont Gas Systems through its 39% ownership stake in Québec energy giant GazMétro. VGS is wholly owned by GazMétro, which also owns 100% of Green Mountain Power.
Last year, Enbridge won approval from the National Energy Board of Canada to reverse and increase the flow of crude oil in a pipeline from Sarnia, Ontario to Montréal. If the Portland Pipe Line Company has its way, some of that corrosive diluted bitumen will flow through a 70-year-old pipeline across Vermont’s Northeast Kingdom. That company operates the Portland-Montréal pipeline and has made clear its intention to reverse the flow so it can transport Alberta tar sands crude through Northern New England to South Portland, Maine. Portland Pipe Line is suing the City of South Portland over the city’s ordinance that would ban the loading of crude oil onto tankers at the port.
Vermont’s Double Standard
Scientists agree that the only hope for stabilizing the climate at a temperature no more than 2°C warmer than pre-industrial averages will be to reduce greenhouse gas (GHG) emissions to net zero by 2055 to 2070. The State of Vermont has set a goal of reducing GHG emissions 50% below 1990 levels by 2028. (Unfortunately, we missed our goal of a 25% reduction by 2012.) According to Vermont’s Comprehensive Energy Plan, “We will not reach the 2028 goal without more direct efforts to lower the state’s contribution to global warming.”
GHGs released in the process of extracting oil from the tar sands projects that TD invests in – everything from strip mining it to delivering it as gasoline to an automobile’s tank – are 81% greater than for the average crude refined in the U.S. On the face of it, these projects are completely incompatible with atmospheric limits and with Vermont’s commitment to GHG emissions reduction. And yet, the State continues to put its cash – our tax dollars – into a bank that is deeply invested in these dirtiest of fossil fuels.
In fiscal year 2014, the State of Vermont deposited almost 70% of its unrestricted cash assets in TD Bank. That was over $230 million in fiscal year 2014, based on average end-of-day balances. During the two-year period of FY13 and FY14, the state paid TD Bank almost $1.5 million in fees. Why does our State continue to put its money – our money — where its mouth most definitely is not?
According to Vermont State Treasurer Beth Pearce, “the choice to deposit funds with TD Bank is based entirely upon the advantageous interest rate the State currently receives on creditable balances.” What is missing from her judgment is any consideration of State energy and climate policy.
In 2012, Gov. Shumlin signed into law a ban on hydraulic fracturing (fracking) within Vermont. Fracking, a process for extracting natural gas and oil from deep underground, is highly controversial because of its history of environmental damage — such as, but not limited to, groundwater contamination from the toxic chemicals that are used. There is evidence that methane leaks during fracking and transport may make natural gas as bad as, or worse than, coal or oil with regard to overall GHG emissions. Yet, the State deposits its cash in a bank that has billions of dollars invested in the pipeline companies that are transporting fracked gas from Alberta into Vermont. The Governor has, so far, supported the project to expand the use of fracked gas in Vermont.
Despite the Treasurer’s bottom line, this much is clear: TD Bank profits from the business it does with the State of Vermont. The bank’s parent invests some of those profits in dirty tar sands infrastructure, which directly contributes to climate change and the consequent crisis we all are facing.