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Copper Tip Energy Services
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Copper Tip Energy

Fossil Fuel Discrimination: Texas Asks 19 Finance Firms for Details on Fossil-Fuel Stances

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(Bloomberg) Texas is seeking information from BlackRock Inc., JPMorgan Chase & Co., Invesco Ltd. and 16 other firms on whether they discriminate against the fossil-fuel industry.The state’s comptroller wrote to 19 domestic and foreign banks and asset managers seeking clarification of their fossil-fuel investment policies and procedures. Any company that fails to respond within 60 days after receiving the letter “will be presumed to be boycotting energy companies,” according to a statement released on Wednesday.The inquiries come six months after a new Texas law went into effect banning state agencies from investing in finance firms that have “boycotted energy companies” or adhere to policies aimed at pivoting away from oil and natural gas in favor of more climate-friendly initiatives. Texas Comptroller Glenn Hegar and his office have been in charge of creating a list of firms that will be subject to divestment.

“We know some of these companies hold investments in oil and gas today, but what about the future? Are they selling the hope of a ‘green’ tomorrow with promises to divest or reduce their fossil-fuel exposure?” Hegar said in the statement. “A handful of companies are echoing promises by the Biden administration about a ‘transition’ to green energy.”

Neither BlackRock nor Invesco immediately responded to requests for comment. A JPMorgan spokesperson declined to comment.

Many of the largest U.S. banks are restructuring lending portfolios in response to pledges by President Joe Biden and other world leaders to pursue a net-zero emissions future. Citigroup Inc. last year said it won’t provide services to certain oil and coal projects, and Bank of America Corp. has promised to zero out greenhouse-gas emissions across its operations. Blackstone is telling clients its private-equity arm will no longer invest in crude exploration and production.

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Texas Lieutenant Governor Dan Patrick issued a letter of his own in January asking the comptroller to put BlackRock, the world’s largest asset manager, on the divestment list. The request followed BlackRock Chief Executive Officer Larry Fink’s own letter spelling out the firm’s stance on fossil fuels and climate goals.

West Virginia Treasurer Riley Moore has also taken aim at BlackRock, saying doing business with them is against the interests of the state economy, which is heavily reliant on coal. On the other hand, the firm has said it’s far from shunning oil and gas, and is one of the world’s biggest holders of energy-company stock.

The Texas comptroller’s office said another round of letters will be mailed to more than 100 other investment houses that appear to have at least one fund boycotting fossil fuels. The divestment list will be completed by Sept. 1.

Other states are following in Texas’s footsteps and drafting similar bills to punish companies they deem as anti-fossil fuel amid a global shift toward a greener future. Legislatures in Louisiana, West Virginia, Oklahoma, Kansas and South Carolina are among those that have introduced similar measures.

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