The growing movement for divestment from fossil fuels and investment in more sustainable, fossil-free and lower-carbon opportunities has important ramifications for the transition of the Appalachian region away from its historical dependency on coal and other extractive industries. The economic reality of Appalachian coal's collapse, particularly in the context of the shale gas boom, is forcing the region through a major structural readjustment, with accelerating job losses and economic distress in coal communities. Many local and regional actors are working aggressively to ensure that this "Appalachian Transition" away from coal dependency is also a "Just Transition," one that builds resilient communities, creates local wealth, and stimulates good jobs in diversified economic activities that sustain natural systems rather than undermine them. Numerous efforts on the ground, notably among practitioners applying the WeathWorks model of rural value chain development, have encouraged alternative forms of economic development in more sustainable sectors such as green affordable housing and residential energy efficiency, local food and agriculture systems, sustainable forestry and wood products, creative industries, tourism, healthcare, light manufacturing, and renewable energy, among others.
At the same time, many institutions across the country, including college and universities, religious congregations, foundations, pension funds, and asset managers, are weighing the prospect of divesting from fossil fuels - in response to one of the fastest-growing divestment movements in recent history. Eliminating fossil fuels from their portfolios is seen by many divestment campaigners as both a moral imperative and a way to bring the urgency of climate change to the attention of the public and government alike. While this strategy may seek to mobilize awareness about global climate change, divesting from fossil fuels poses certain complicating questions as well, especially from the more local and regional perspective of communities most heavily dependent upon coal. For local actors long aware of the problems that coal dependency imposes upon the region, fossil-fuel divestment presents a potential opportunity to diversify Appalachia's economy. And for organizations and enterprises working in clean, sustainable business, fossil-free investing could be a source of capital to help finance a more just economic transition. For others in the region, however, divesment can appear more as a threat, especially when it is perceived as exacerbating the social dislocations associated with the collapse of increasing numbers of bankrupt coal-mining concerns. Divestment consequently creates strategic social dilemmas that need to be addressed.
This paper, commissioned by the Mountain Association for Community Economic Development (MACED), explores the relevance of divestment for the Appalchian Transition.
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