FOR IMMEDIATE RELEASE
October 22, 2024
Contact: Lindsay Meiman, lindsay@stand.earth, +1 (917) 970-2281
New Yorkers, Frontline Leaders, Climate Groups React to NYC Comptroller’s Groundbreaking Private Equity Commitment
NEW YORK – Today, New York City Comptroller Brad Lander announced a commitment to exclude new pension investments in private equity-backed fossil fuel midstream and downstream companies and projects, addressing a significant loophole in the funds’ Net-Zero Implementation Plan. This makes NYCERS, NYCTRS, and NYCBERS – three of New York City public pensions representing $207 billion in assets – the first-in-the-nation to make such a commitment, setting precedent for funds across the country and around the world to follow suit.
If passed, the new policy would exclude future investments and limited partnerships in fossil fuel exposed private equity funds. Climate and community groups, including 350NYC, Fridays For Future New York City, Strong Economy for All, Climate Families – NYC, Americans for Financial Reform, Stand.earth, Climate Organizing Hub, and New York Communities for Change regard the announcement as a major step toward reconciling loopholes in net-zero commitments, reducing funding for high-polluting projects, and protecting pension funds from financial risks associated with fossil fuel holdings.
The 2024 Private Equity Climate Risks Scorecard & Report, released earlier this month, reveals that private equity firms have an outsized role in driving the climate crisis and are responsible for 1.17 gigatons of annual emissions through ownership of dirty fossil fuel assets — more than global aviation, on the scale of the Canadian wildfires of last summer. The PECR Scorecard also reveals the current lack of transparency among private equity’s energy portfolios posing a dual threat: financial risk to pension funds and other investors, and exacerbated climate risk through continued exposure to fossil fuel assets.
NYCERS currently has more than $2.3 billion in investments in private equity firms that invest heavily in fossil fuel assets; NYCBERS has $775 million, and NYCTRS has $600 million. This includes investments in the private equity firms Kohlberg Kravis Roberts (KKR) & Co (64.9 million annual metric tons CO2e) and Global Infrastructure Partners (GIP) (20.5 million annual metric tons CO2e), now owned by BlackRock (105 million annual metric tons of CO2e).
In recent years, private equity has increasingly owned controversial fossil fuel projects, including the Port Arthur LNG Terminal and Rio Grande LNG Terminal. Projects like these are susceptible to leaks and explosions, pollute air and water, and are deadly for workers and communities. Research from Cornell University reveals “greenhouse gas footprint for LNG as a fuel source is 33% greater than for coal.” The private-equity backed buildup of the U.S. LNG risks dangerously impeding New York, and the United States’ ability to meet climate goals to stave off the worst of the climate crisis.
In 2018, New York City became the first group of public pension funds in the country to commit to fully divest from fossil fuels, which was implemented in 2021 with $4 billion in holdings divested. NYC paired this with a commitment to have $50 billion in climate solutions investments by 2035. To date, over 1630 institutions representing more than $40 trillion in assets have committed to divest from fossil fuels.
QUOTE SHEET
Chief Na’Moks, Wet’suwet’en Hereditary Chief, said: “The Wet’suwet’en Nation has been in a years-long struggle against Coastal GasLink, a private-equity backed pipeline that runs through our home. Members of our Nation have pushed back against KKR, the private equity firm that finances the pipeline, and have faced arrest, surveillance, and harassment for their efforts to protect our land, our people, and the planet. Today’s announcement from Comptroller Brad Lander represents an important step forward for Indigenous Nations like ours, who are unwilling to allow Wall Street to destroy our land and way of life. Fossil fuels are a bad bet for our climate, community members, and pensions. New York City’s leadership on this issue opens a path for other public pension funds to stop investing in a dying industry, and start investing in our clean future.”
Bekah Hinojosa, with South Texas Environmental Justice Network based in Brownsville, Texas, said: “This decision from Lander’s office is a great first step that is a result of activists and frontline community members resisting fossil fuel corporations. The next needed step by New York City is a complete withdrawal from current investment in destructive fracking projects, like the proposed Rio Grande LNG facility that would harm my community’s coastline and release the equivalent climate-killing emissions of 20 more than coal plants yearly.”
Michael Johnson, New York Communities for Change, said: “New York City will once again lead the nation by ending new private equity investments into super-polluting projects like LNG ports and fracked gas pipelines. Those investments heat the planet, causing the climate crisis, and are also rip-off investments for public pension funds. This is an historic moment for the city and the world. We thank Comptroller Lander for pioneering this vital policy, as well as the activists and organizations who helped make this possible.”
Lena Goings, high school student and youth organizer with Fridays For Future NYC, said: “This is a huge win for climate justice and for our generation. With this move, Comptroller Lander is showing the world that it is possible, and even wise, to prioritize the future and cut ties with the fossil fuels that are threatening our health and livelihoods. It’s time for truly fossil fuel free pension funds aligned with the need to combat the current worsening climate crisis and aligned with the call for a liveable and just future.”
Dorian Fulvio, Organizer with 350NYC, said: “Comptroller Lander’s extraordinary commitment is another big step in the process of reducing the greenhouse gas emissions of New York City’s pensions’ portfolios. This action protects the NYC pension systems from opaque and risky holdings in private equity fossil fuel investments. It couples ecological harm reduction with economic risk reduction, and shows that prudent investing can also be good for the planet.
Historic actions like this one do not happen overnight. This commitment is the result of an energetic campaign undertaken by an amazing coalition of determined activists and organizations across New York City and around the world. At a time when climate action is getting such furious push back, Comptroller Lander shows us that hard work pays off.”
Cassie Cain, Stand.earth Climate Finance Campaigner, said: “By making this announcement, Comptroller Lander is looking out both for the climate and pension beneficiaries. This is a groundbreaking move that opens the door to pension funds in New York State and beyond to follow suit. Just like when the Comptroller’s office announced its intention to divest from publicly traded fossil fuel companies, we expect others to step up and take similar action. This is the power of New York City.”
Liat Olenick, a NYC public school teacher and organizer with Climate Families NYC, said: “As someone who is vested in the NYC pension system, I’m excited to see the Comptroller lead the way on ruling out risking our futures on dangerous investments in fossil fuels. It’s time for other cities to follow New York’s lead and divest from the fossil fuel industry.”
Jonathan Westin, Executive Director, Climate Defenders, said: “Private equity investments in fossil fuels imperil the future of our planet, and have devastating effects on climate change. The Comptroller and the NYC pension funds are doing the right thing by drawing a hard line on private equity funds that continue funding fossil fuels. We cannot continue using money managers that are financing the destruction of the planet.”
Melanie Kruvelis, Senior Climate Finance Organizer at Strong Economy for All, said: “Private equity firms bet workers’ pensions on fossil fuel projects that make their executives wealthy while the rest of us suffer under extreme heat, intensive floods, and worsening storms that uproot life as we know it. Today’s announcement from Comptroller Lander sends a signal to Wall Street that we will no longer allow billionaires to sink our retirements into deadly oil and gas projects that are financially risky and ecologically deadly.”
Rev. Chelsea MacMillan, Climate Finance Campaign Organizer at GreenFaith, said: “Comptroller Lander has taken an important first step in making sure NYC workers’ pensions are not tied to risky fossil investments that kill creation and destroy our hope for a sustainable future. We hope and pray that he will continue to make decisions with moral clarity and do what is right for our city and the planet.”
Oscar Valdés Viera, Research Manager at Americans for Financial Reform, said: “Private equity’s investments in fossil fuel companies worsen the climate crisis and risk the future of frontline communities impacted by climate disaster, as our research with the Private Equity Climate Risks Consortium has uncovered. Private equity asset managers jeopardize the financial future of retirees, whose public pension contributions are used to fund these investments, by tying their retirement security to dirty assets. Comptroller Lander’s commitment to ending new investments in private equity-backed midstream and downstream fossil fuel companies for New York City’s public pensions is a critical step to addressing the looming climate and financial risk produced by investing in these opaque funds and dirty assets. Comptroller Lander’s precedent-setting commitment creates an opportunity for pensions nationwide to take similar steps towards a just and sustainable energy transition.”
Roni Zahavi-Brunner, Co-founder, Planet Over Profit, said: “Planet Over Profit applauds Comptroller Brad Lander for finally taking an important step to protect his constituents from further climate chaos. No New York employee hoping to invest in their future should be forced to instead invest in its destruction. I had my collarbone broken while disrupting a speech by Lander, taking direct action to secure this crucial win; we sincerely hope (and advise) that Lander now muster the courage to maintain this momentum towards the city’s continued fossil fuel investments via BlackRock.”
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