PowerDowntheEndowment:FactSheetforUniversityCouncilOpenForum

February17,2016
PreparedbyRitaWegnerandFossilFreePenn

Fact1
.Pennsemissionsfromcampusoperationsarefaroutweighedbyitsemissionscontributionsasa
fossilfuelinvestor.Thishassignificantimplicationsfortheeffectiveuseofschoolresourcesandthe
hypocrisyofnotdivesting.PennalreadydevotessubstantialresourcestoGreenCampusPartnership
(e.g.theongoingPowerDownchallenge),buteveryyearanypositiveenvironmentalimpactis
completelyerased(by
atleast3times
)duetoourroleasafossilfuelinvestor.Thisratioincreasestoat
least
190years
whenconsideringPennstotalmoralliabilityasaninvestor.Thesefiguresarevery
conservativelowerbounds.

Fact2.
SincefossilfueldivestmentwasfirstpresentedatUCOpenForumonFebruary20,2013,overthe
lastthreeyearsPennhad
lostover$80million
bychoosingtonotdivestfromfossilfuelswhichwould
havebeenabletosupportover
1,600studentstuition
infull.Thisisaconservativelowerboundbecause
itignoresinvestmentsoutsideUSequities.

Fact3.

Overthesameperiod,stocksin
renewableshavedramaticallyoutperformedthe
fossilfuelindustry.Eventhoughtherecentprice
environmenthashurtallenergycompanies,itis
clearthatcleanenergyfirmshavebeenmore
robustthanfossilfuelextractors.Thisimpliesthe
recentrelativedownturninfossilfuelstocksisnot
justtemporary(e.g.simplyduetothecommodity
priceshock)butratherstructuralbecausefossil
fuelsareonthelosingsideofthecleanenergy
transition.Pennhasnotjustamoralbutfinancial
reasontobepartofthistransitionviareinvesting
incleanenergy.

CalculationsforFact1:
AsperCAPMsmarketportfolio(sinceOfficeofInvestmentsdeclinedtodiscloseexactendowment
holdings),assumePenn'ssharesineachCarbonUnderground200companyisproportionaltooverall
marketcap.ThisconservativelyignoresPenn'spossiblefossilfuelholdingsthroughfundmanagers,e.g.
hedgefunds.Furthermore,theyearlymultiplefigureisadditionallyconservativebecauseweassumethat
all200companiesareproducingatthesamelevelsasthesmallest2companiesgivingalowerboundon
thetotalemissionsforwhichPennisresponsibleasaninstitutionalinvestor.

Item
TotalO&GReservePotential(GT)
TotalCoalReservesPotential(GT)
TotalFossilFuelGHGPotential(GT)
2014TotalGlobalListedEquities($billion)
Penn'sEndowment(billion)
%USEquities
%InternationalEquities
%EmergingMktEquities
Penn%inPublicEquity
Penn'sholdingsinpublicequity(billion)
Penn'sproratashareofpublicequity
Penn's2014postRECemissions(T)
Penn'sproratashareofGHGpotential(T)
YearstoMatch

Value
153.85
401.55
555.4
66505.57
$10.10
15%
16%
10%
41%
$4.18
0.006287%
184,218
34,919,627
189.56

Source
FFICarbonUnderground
FFICU

WorldBank
PennFinancialStatement
Penn
Penn
Penn

PennClimateActionPlan2.0

Alcoa2014coalproduction(millionT)
Enerplus2014oilproduction(barrels)
Enerplus2014gasproduction(Mcf)
Shorttonpermetricton
Coal:MillionBtupershortton
Coal:kgCO2permillionBtu
Smallestcompany'scoalemissions2014(T)
Gallonsperbarrel
Crudeoil:kgCO2pergallon
Smallestcompany'soilemissions2014(T)
Naturalgas:Btupercf
Naturalgas:kgCO2perMMBtu
Methaneleakage:lowestimate
Cubicfeetpercubicm
Methane:density(kgpercubicm)
Methane:GHGpotentialvs.CO2
Smallestcompany'sgasemissions2014(T)
Smallest(rank100)totalemissions2014(T)
Totalassumingallproducingleastamount(T)
Penn'sshareofemissionsasinvestor(T)
Investor/Consumermultiple:lowerbound

39.4
14,675,920
129,991,830
1.10231
19.622
93.28
79493529
42
10.29
6342639
1032
53.06
1.50%
35.31
0.6797
56
9113225
94,949,393
9,494,939,299
596,975
3.24

AlcoaAnnualReport
EnerplusFinancialStatement
EnerplusFinancialStatement
EIA
EIA
EIA

EIA

EIA
EIA
EPA

AirLiquideGasEncyc.
UNFCC

CalculationsforFact2
:

S&P500(NotDivest)
FFIUS(Divest)
February20,2013
1530.94
140.06
February16,2016
1895.08
181.03
Returns
23.79%
29.25%
Note:FossilFreeIndexesUS(FFIUS)isabenchmarkindexbasedontheS&P500thatexcludesany
companiesontheCarbonUnderground200.ThusFFIUSrepresentstheCAPMmarketportfolio(forthe
USmarket)underFossilFreePennsdivestmentproposal.Theseindicesareallpubliclyavailable.

LostReturnsbyNotDivesting
5.47%
2013Endowment($billion)
7.7
2013%USEquities
19.1%
Penn'sLostValue($million)
80.39
PennUndergradTuition($)
49,536
LostValuein#ofStudentsTuition
1623
Note:TheseestimatescanbemoreaccurateiftheOfficeofInvestmentsweretoreleaseinformationon
specificequityholdings,orweretoconductitsown(publiclyavailable)analysisonthelostvalue.

CalculationsforFact3:

RENIXX
NEX
S&PO&G
DJUSCoal
2/16/16
383.51
149.34
3671.77
19.49
2/17/15
434.08
186.44
8191.33
93.08
2/20/13
197.86
135.17
9702.56
150.69
1YReturns
11.6%
15.7%
47.0%
78.9%
3YReturns
93.8%
16.2%
55.3%
87.0%

Accordingtotheirfactsheets:
TheRENIXX(RenewableEnergyIndustrialIndex)Worldisthefirstglobalstockindex,
whichcomprisestheperformanceoftheworlds30largestcompaniesoftherenewableenergy
industrywhoseweightingintheindexisbasedonthemarketcapitalization.
TheNEXisaglobalindexof105companieslistedon28exchangesin23countrieswhose
innovativetechnologiesandservicesfocusonthegenerationanduseofcleanerenergy,
conservation,efficiencyandtheadvancementofrenewableenergyingeneral.Companies
worldwideactiveinwind,solar,biofuels,hydro,waveandtidal,geothermalandotherrenewable
energybusinesses,aswellasenergyconversion,storage,conservation,efficiency,materials,
pollutioncontrol,emerginghydrogenandfuelcells.
S&PSelectIndustryIndicesaredesignedtomeasuretheperformanceofnarrowGICS
subindustries.TheindexcomprisesstocksintheS&PTotalMarketIndexthatareclassifiedin
theGICSoil&gasexploration&productionsubindustry.
Note:S&PO&Gisagoodindexfortheextraction(upstream)companiestargetedby
CarbonUnderground200,sinceitexcludesmidstreamanddownstreamfocusedfirms.
Theabovereasoningappliestoupstreamcoalextraction,i.e.theDowJonesUSCoalIndex.