When Sweden’s central bank announced it would sell off Alberta government bonds because of the province’s high carbon emissions, the reaction from Alberta’s political leaders was swift and defensive.
The bank was concerned with Alberta’s total emissions, and by that measure the province is doing terribly. Its oil sands alone did more damage to the climate last year than the entire economy of B.C., and Alberta’s per capita carbon emissions of 62.4 tonnes dwarf those of the U.S. (15.53 tonnes) or even Saudi Arabia (16.85 tonnes).
Heidi Elmér, the head of Riksbank’s markets department, explained that bond issuers like Alberta are no longer a good fit for an international financial institution that’s trying to become more sustainable. Divesting from Alberta and reinvesting in bonds from lower-emitting provinces like B.C. hasn’t hurt the bank’s performance, she said. This interview has been edited for length and clarity.