UC’s “Fossil Fuel Free” Investments Include Billions in Oil and Gas

On April 4, the Intergovernmental Panel on Climate Change released its final report on the policy changes needed to keep the average global temperature increase below 1.5C.

It is hard to overstate the urgency of the report, which emphasizes the need to immediately and rapidly decrease greenhouse gas emissions to avoid global catastrophe.

Meanwhile, the University of California is promoting its Cool Campus Challenge, which encourages us to make small lifestyle changes to “help the UC system reach carbon neutrality by 2025”.

The UC’s goal of carbon neutrality largely relies on paying for people in developing countries to emit fewer greenhouse gasses so we don’t have to change our institutional behavior.

As for small lifestyle changes, taking actions to lessen our personal carbon footprints is not inherently bad, but we shouldn’t delude ourselves into thinking it’s enough: 100 fossil fuel companies are responsible for 71% of all greenhouse gas emissions since 1988, and 57 of these companies are owned by public and private investors — including the UC.

In May 2020, the UC announced that its investments were now “fossil fuel free” and that moving forward, the university would put its assets in wind and solar power.

To see if the UC has held true to this promise, I reviewed the UC’s most recent list of asset holdings from 2021.

I compared this list against the Private Equity Stakeholder Project’s (PESP) reports on the private equity firms that put the most money into the fossil fuel industry.

As of 2021, the UC was still investing in half of the 22 firms listed in these reports including:

• Blackstone - 17 investments totaling $1,241,158,824
• KKR and Co. - 2 investments totaling $100,427,970
• Apollo Global Management - 9 investments totaling - $681,036,662
• Ares Management - 3 investments totaling $45,412,328
• Warburg Pincus - 3 investments totaling $159,889,396
• EnCap - 4 investments totaling $151,553,271

• Blackrock - 1 investment totaling $2,111,161,980
• Stonepeak Infrastructure Fund - 3 investments totaling $211,860,528
• TPG Capital - 3 investments totaling $148,553,714
• Brookfield - 3 investments totaling $223,920,361
• Encap - 4 investments totaling $151,553,271

Together, these investments add up to $5.2 billion, about 5.8% of the UC’s total asset holdings - and this only includes the private equity firms that were included in the PESP’s reports.

Although the UC does not directly invest in oil companies like Enron or Halliburton, by holding assets in private equity firms, the UC is financing a number of extractive industries and oil pipelines that will accelerate climate change, worsen environmental racism, and undermine Indigenous sovereignty.

For example, KKR is a major financier of the Coastal Gaslink pipeline that’s being built through unceded Wetʼsuwetʼen territory in the Pacific Northwest, while Blackstone owns a major coal plant in Ohio and financed both the Dakota Access Pipeline and the Rover Pipeline.

A report by Vox on the UC’s declaration of fossil fuel free assets noted that the UC’s decision to move assets away from certain oil companies like Halliburton was not based on concern for climate change, but on the belief that those investments were financially risky.

The UC’s claim of going “fossil fuel free” was merely greenwashing decisions that were actually based on money.

In light of this, the Cool Campus Challenge’s emphasis on individual actions and “carbon neutrality” feels like a convenient way for the UC to distract from its own complicity in climate change.

At UCSF, most of us are in biomedical and health fields, and we have a vested interest in urging our university to truly divest from fossil fuels.

The IPCC report I mentioned at the beginning of this article predicts that in a “high greenhouse gas emission scenario”, we’ll see an additional 9 million annual deaths by the end of the century.

UCSF was the first campus to vote in favor of urging the UC to divest. If this is to be more than just symbolic, we have to hold the UC accountable for its continued financing of and reliance on the fossil fuel industry.

An immediate reduction in atmospheric CO2 is necessary to save lives, and individual lifestyle changes won’t get us there.

Finn is a graduate student in the School of Nursing.