With over a trillion dollars in energy investments that generate high greenhouse gas emissions, private equity firms have an outsized role in accelerating the climate crisis.

New research for this edition of the scorecard exposes the staggering extent of these investments, revealing that the energy portfolios of leading private equity firms are responsible for 1.17 gigatons of annual emissions. That’s 1.17 billion metric tons of CO2 equivalent—concentrated in sectors like upstream fossil fuels, Liquefied Natural Gas (LNG) terminals, and coal plants.

EIG Global Energy Partners ranked last, earning a  F .

Despite controlling vast networks of energy assets deeply embedded in our global economies, private equity firms remain largely unregulated, evading the financial disclosures that would expose the true extent of their environmental impact. As of July 2024, a staggering 67 percent of the energy portfolios of the 21 private equity firms featured in this report are still invested in fossil fuels.

By doubling down on polluting portfolios, these firms are not only accelerating the climate crisis but also exposing themselves—and their investors—to significant financial risks.

Fossil fuels are becoming increasingly risky investments as the economy transitions to clean energy, which could lead to large scale asset stranding and financial instability. For instance, between 2012 and 2022, at least 60 U.S. coal companies filed for bankruptcy, and the fossil gas industry faces similar headwinds with declining demand and oversupply challenges.

Much of the capital fueling these environmentally destructive investments comes from public sector workers’ pensions. Yet, there is minimal disclosure to these pension fund managers about the climate risks associated with their investments. The lack of transparency poses a dual threat: financial risk to institutional investors and exacerbated climate risk through continued exposure to fossil fuel assets.

This report brings much-needed scrutiny to the fossil fuel holdings of 21 private equity firms, including major buyout firms, infrastructure firms, and energy specialists. It ranks these firms based on their fossil fuel assets, emissions, and progress toward an energy transition, aligning with five key climate standards:

1. Align with Science-Based Climate Targets to limit global warming to 1.5⁰C.

2. Disclose Fossil Fuel Exposure, Emissions, and Impacts transparently.

3. Report a Portfolio-Wide Energy Transition Plan to guide the shift to clean energy.

4. Integrate Climate and Environmental Justice into their business strategies.

5. Provide Transparency on Political Spending and Climate Lobbying efforts.

Private equity firms’ ongoing—and in some cases increased—involvement in the fossil fuel sector underscores the need for accountability and real commitments to pursuing just transitions from private fund managers.

In order to fully understand the true scope of private equity firms’ energy sector holdings, and how these investments align with their public statements on climate change, it is necessary to examine energy-sector portfolio companies at the asset level.

The Private Equity Climate Risks Scorecard analyzes 21 private equity firms including large-scale buyout firms, infrastructure firms, and energy specialists. The research analyzes firms’ energy holdings, identifies upstream, LNG terminals, and coal-fired power plants and their respective emissions, as well as the firms’ actions to meet the Climate Demands based on analysis of publicly available information in addition to any information provided by the firms directly.

Based on analysis of that data, it was calculated that the private equity energy portfolios covered in this report are responsible for a combined total of over 1.17 gigatons of emissions annually. This figure equals 1.17 billion metric tons of C02e.

Private equity firms have invested billions in fossil fuel activities, generating massive pollution that starkly diverges from alignment with a Paris-aligned pathway to limit global warming to 1.5°C, and actual emissions may be higher.