Coal: The Low-Hanging Fossil Fuel

My projected retirement date is 2060, and I would like to retire on a healthy planet, with a healthy pension fund.”

Keith Gonzalez, an employee at the Washington State Department of Ecology and a member of the Washington Federation of State Employees (WFSE), said this while testifying on the Coal Act, SB 5439, before the Senate Ways and Means Committee on January 29, 2026. Keith made the argument that a fundamental principle of the State Investment Board’s fiduciary duty is impartiality – treating all beneficiary groups equally. This principle has been violated, he said, through the SIB’s investments in coal and other fossil fuels. These investments lock us into high-warming climate investments that accelerate climate disaster and significantly disadvantage future state employee beneficiaries over current beneficiaries.

Bill McKibben, founder of 350.org and Third Act, testified that, “Washington State is not being asked to do anything novel or revolutionary,” but, rather, to join other institutions and endowments with assets of $41 trillion that have joined the effort to divest from fossil fuels. Bill pointed out that, not only is coal the dirtiest of the fossil fuels, but it is also the fossil fuel asset with the steepest decline in value. Divesting from coal “is the ultimate and easiest no brainer, and I ask you to take action quickly because climate change is happening quickly.”

Donna Albert, former state employee and WFSE member, and current Retired Public Employee Council of Washington (RPEC) member, pointed out that the Washington State Investment Board (WSIB) doesn’t use its voice very well in proxy battles over corporate climate and carbon reduction policies; it received a grade of D from the Sierra Club, which evaluates pension fund accountability and divestment actions around climate issues.

Andrew Eckels, 350.org Seattle, asked, “Why should a public agency prioritize short-term marginal gains over mitigating the risk of long-term catastrophic damages of investing in coal?” He argued that climate risk from fossil fuel investments is literally playing with fire.

Barbara Carey, former WFSE member and current member of RPEC, testified that, while the WSIB still has $2.6 billion invested in coal, New York State, California, Oregon, and New York City have already used the Global Coal Exit list to divest from this dirtiest of fossil fuels.

Adam Lough, Physicians for Social Responsibility, testified that “air pollution caused by burning coal is linked to respiratory disease, cardiovascular disease, cancer, dementia, and neurological disorders. No amount of returns on (coal assets) is worth Washington-funded disease.”

Anna Joy Gillis, a state employee at the Department of Commerce, testified that she objects to her contributions being invested in coal assets and that these types of investments are antithetical to Washington State’s Climate Commitment Act and energy strategy. It should be noted that testifiers were given 60 seconds (with up to 5-10 seconds overage) to make their cases.

I blurted out the following in my one minute:

“Madame Chair and Committee Members, my name is Jeff Johnson, former President of the WSLC and current co-president of the Puget Sound Advocates for Retirement Action.

"I support the Coal Act for three fundamental reasons:

"First, a decade ago, I testified before this legislature that climate change was an existential crisis. Since then, the financial industry has invested $8 trillion in fossil fuels, dramatically increasing the magnitude of this crisis and the urgency to stop using fossil fuels.

"To my way of thinking, maintaining direct fossil fuel assets in the SIB portfolio means we are collectively and willfully building our own gallows. Second, fossil fuel assets are a bad investment. For the past decade, fossil fuel assets have been quite volatile and have significantly underperformed the rate of return of the Standard and Poor Index and most other assets. Under the standard definition of financial prudence and rules of fiduciary responsibility, fossil fuels are a bad investment. Factoring in fossil fuel externalities, these assets become financially imprudent.

"Third, Washington State has led on many progressive economic reforms – minimum wage, family leave, and paid safe and sick days. Rebalancing the SIB portfolio out of fossil fuels will be an example to other institutional investors that you can achieve a good rate of return while helping to save the planet at the same time. Not too shabby an idea."

Only one group testified against the Coal Act and that was the Washington State Investment Board. If you look at the sign-up sheet, will you see the SIB listed as a NO? Of course not. But what they said repeatedly is we have produced great returns, we know what we are doing. But then they said, “we have our investment beliefs… any kind of investment or asset class restraint you put on our portfolio will likely result in lower returns over time and will also increase costs.”

In my next article we will look at this claim and evaluate what type of voice the SIB projects.