by Audrey Streb
Major global asset managers including BlackRock and Blackstone are moving to buy energy companies across America, a move some industry insiders say could hurt consumers, raise electricity costs and advance a climate-based energy agenda.
In recent months, Blackstone apparently sought regulatory approval to purchase utilities in New Mexico and Texas as a group led by BlackRock won Friday’s approval of the purchase of a major Minnesota utility. While BlackRock and other enormous asset managers have done this they distanced themselves from environment, society and management (ESG) investment practices in recent years, some energy experts and consumer advocates who spoke to the Daily Caller News Foundation fear that buying utilities could be a novel frontier for financial giants pursuing “climate mandates.”
“BlackRock no longer just influences utilities, they buy them. After years of ESG-driven coercion that forced utilities to abandon reliable energy in favor of China-dependent renewables, BlackRock is now taking direct control. The result will be more or less the same: higher costs, weaker networks and millions of unpaid bills, all it’s because of the very climate mandates he lobbied for,” Jason Isaac, CEO of the American Energy Institute, told DCNF. “Minnesotans should prepare for more unreliable government, rising interest rates, and a media narrative that blames Trump for ending taxpayer-funded handouts rather than blaming the crisis on woke politicians and Wall Street elites.”
The demand for electricity is on growth after years of stagnation as artificial intelligence (AI) race starts building power hungry data centers. Utility costs too spikes as demand increases in trend goes back down Biden administration.
In this context, private investment titans such as BlackRock and Blackstone are reportedly looking to buy energy companies and invest in data centers extensions AND startups.
Recently in Minnesota given the agreement of a group led by BlackRock, known as Global Infrastructure Partners (GIP), to buy one of the state’s major energy companies, Allete. According to reports, GIP is also on the verge of taking over a enormous energy company, AESAccording to sources familiar with the matter, that spoke with Reuters. Financial Times. reported that the deal could cost $38 billion.
BlackRock referred DCNF to Allete’s statement on regulatory approval of its partnership with GIP and declined to comment further for this story.
Allete’s statement noted that the upcoming partnership with the BlackRock-led group includes “guaranteed access to capital to fund ALLETE’s five-year plan to advance its transmission and renewable energy goals [and a] A $50 million Clean Technology Fund to support regional tidy energy projects and partnerships.
Federal Energy Regulatory Commission (FERC) renovated BlackRock skill up to 20% of shares with voting rights in April, z ex FERC Commissioner Mark Christie stating this CzarnyRock “has committed not to use its shares to influence the management of utilities” and that utilities need access to capital.
Christie too warned in September 2024 that “this is an issue that deserves much greater analysis” and that “the impact that large shareholders, BlackRock or others, could potentially have on the utilities industry that serves consumers should not be underestimated.”
Blackstone recently asked regulators for approval to buy out Public Service Company of New Mexico and Texas New Mexico Power Co., according to the Associated Press. Asset management giant too secured 19.9% stake in Northern Indiana utility for over $2 billion in January 2024.
“Blackstone’s sustainability strategy prioritizes accelerating decarbonization by investing in the energy transition and pursuing emissions reductions that add value to our portfolio” – Blackstone 2024 Sustainability Report states. “We believe the transition to cleaner energy creates significant investment opportunities for private capital. For over a decade, we have been making attractive investments in companies and assets that are part of the global energy transition as part of our broader energy investing strategy.”
Blackstone too announced On September 15, private equity funds affiliated with Blackstone Energy Transition Partners will acquire Pennsylvania-based natural gas plant Hill Top Energy Center for nearly $1 billion. The company too announced in July, funds managed by Blackstone Infrastructure and Blackstone Real Estate will invest more than $25 billion to assist build Pennsylvania’s energy infrastructure to support the artificial intelligence “revolution.”
Renewable energy targets and ESG investments tend to align with emissions reduction targets, with some strength companies, tools AND states that have set emissions reduction targets in a bid to phase out conventional energy sources such as coal-fired power plants. Isaac added that companies such as American Electric Power, in which BlackRock has significant share, were liquidation coal-fired power plants and replacing them with intermittent sources such as shining.
“When the wind stops blowing and the sun stops shining, you have to increase generational assets again and that’s when prices shoot up,” Isaac said.
Greg Brown, a finance professor at the University of North Carolina at Chapel Hill, told the AP that the reason for these buyouts is “very simple. Because there’s a lot of money to be made.”
Other consumer protection experts, such as Consumer Research Executive Director Will Hild, told DCNF that investment firms like BlackRock stand to gain more than just profit from such purchases.
“There is no world in which BlackRock’s ownership of American energy benefits ordinary American consumers,” Hild told DCNF. “This is the same company that proudly introduced us to radical ESG policies and Net-Zero nonsense that caused all of our energy bills to skyrocket. We wouldn’t have the scourge of woke capitalism without Larry Fink, who already controls nearly $13 trillion in assets and has been sued for antitrust violations.”
ESG investors weigh the company through its social and environmental choices, as well as its finances, in this way critics to talk burdens companies with novel costs while doing little to combat climate change. One influence map for August 2023 report showed that as Republicans at the state level and in Congress have stepped up their opposition to ESG-focused practices, BlackRock and other major U.S. asset managers have decreased their support for climate resolutions.
So did BlackRock CEO Larry Fink he said in June 2023 that it will no longer exploit the term ESG because it has been “politicized”, less than a year after excellent that rising energy prices are “accelerating” the transition to green energy.
“BlackRock has retreated from its ESG message and its aggressive, uncompromising enforcement of ESG on everything it touches. But the leopard has not changed its spots,” Heartland Institute President James Taylor told DCNF. “It still has the same leadership group with the same values and continues to do everything in its power to impose ESG on everything it touches, in fact if not in name.”
Taylor argued that whether BlackRock buys or takes a enormous stake in the utility, “it may now have the upper hand over legislators to dictate energy policy.”
In particular, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) they threw their weight is behind an antitrust lawsuit against major asset managers that alleges the companies colluded to halt coal production as they meet zero-emissions targets in May.
The lawsuitsupported by 11 state attorneys general, alleges that BlackRock and many other asset managers have used their market power to limit coal production, thereby harming consumers and driving up coal prices.
“The Department of Justice and FTC’s support for this baseless case undermines the Trump administration’s goal of America’s energy independence,” BlackRock spokesman previously said DCNF. “As we explained in our earlier motion to dismiss this case, this case is an attempt to rewrite antitrust law and is based on the absurd theory that coal companies conspired with their shareholders to limit coal production.”
Blackstone did not respond to repeated requests for comment from DCNF.
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Audrey Streb is a reporter for the Daily Caller News Foundation.
Photo “Larry Fink” by World Economic Forum. CCBy-NC-SA 2.0.
