On Wall Street, the ‘energy transition’ includes natural gas and data centers — SkimNews
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- Blackstone said in mid-October that its transition fund raised $8.7 billion this year and turned away another $3 billion to stay below its maximum investment cap.
- Blackstone ceased oil-and-gas production investing five years before adding “energy transition” to its fund’s name in 2022, and this year announced six investments spanning gas plants, data-center cooling, renewables and grid technology.
- Private-equity transition funds raised $178 billion from 2021 through early 2026, triple the amount raised by comparable fossil-fuel and general-energy funds, according to Ryan Loughead’s research.
- Brookfield manages transition funds partly through an explicit decarbonization commitment and permits natural-gas investment when it replaces dirtier fossil fuels, though the firm has drawn criticism for treating gas expansion as transition.
- BlackRock says “not all sustainable strategies are transition, and not all transition strategies are sustainable,” a distinction that complicates investors’ claims about how sustainable their portfolios are.
- Oregon Treasury, the Minnesota State Board of Investment and the San Francisco Employees’ Retirement System committed a combined $525 million to Blackstone’s fund while holding climate-related goals or plans.
- Ryan Loughead said transition funds that include gas tend to have slightly higher returns than those without it, giving investors a financial incentive to include gas under the transition label.
Why it matters: Three government-managed investors with climate-related goals have committed $525 million to Blackstone’s gas-inclusive fund, while gas-inclusive transition funds tend to earn slightly higher returns. That makes pension officials’ sustainability claims harder to verify because “transition” portfolios can include gas without showing a clear commitment to reducing emissions.
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