Key Takeaways
- • The top 20 private equity firms globally manage $7.3 trillion in assets yet generate 1.5 billion tons of greenhouse gases annually—more than any country except China, the US, India, and Russia—according to research by the Private Equity Climate Risks Consortium.
- • Private equity firms own or control 370 fossil fuel-powered plants with 124GW of power generation capacity, 15,000 miles of pipelines, and hundreds of oil and gas fields, with significant investments in natural gas and coal-fired power plants powering data centers despite having capital to transition to cleaner energy.
- • Half of the top 10 US data center owners are backed by private equity, creating substantial hidden emissions exposure that has historically escaped regulatory and public scrutiny due to the opacity of private markets.
- • Private equity has funded more than $1 trillion in fossil fuel assets since 2010, with investment trends accelerating in 2025 driven by surging power demand and favorable regulatory conditions.
Summary
Private equity's substantial fossil fuel footprint is drawing increased scrutiny as research reveals the climate impact of the sector's energy infrastructure holdings. The Private Equity Climate Risks Consortium conducted an analysis of the 20 largest private equity firms invested in global energy infrastructure, finding that their combined energy portfolios produce annual greenhouse gas emissions equivalent to those of most sovereign nations. The firms' 370 fossil fuel-powered plants, which generate 124GW of capacity, along with 15,000 miles of pipelines and hundreds of oil and gas fields, underscore the scale of private equity's exposure to carbon-intensive assets.
The concentration of private equity backing in the US data center sector amplifies this environmental exposure. Half of the top 10 US data center owners are backed by private equity investors, and these firms have increasingly invested in natural gas and coal-fired power plants to provide reliable electricity to support data center operations. Industry observers note that this contribution to global emissions has received comparatively little public attention, in part because private markets operate with substantially less transparency than public equity markets. According to research from the Private Equity Stakeholder Project, private equity funding of fossil fuel assets has exceeded $1 trillion since 2010, with momentum continuing through 2025 as rising electricity demand and pro-investment policy environments encourage further deployment of gas-fired power generation capacity, particularly in western US regions where infrastructure is being developed to support intermittent renewable resources.
Despite managing sufficient aggregate capital to enable sector-wide transition strategies away from fossil fuels, the top 20 private equity firms have prioritized energy infrastructure investments that lock in continued reliance on natural gas and coal for the next decade or longer. The opacity of private markets and limited disclosure requirements have historically shielded private equity's energy investments from the regulatory and reputational pressures increasingly facing publicly traded energy companies, though this landscape appears to be shifting as research documenting the sector's climate impact becomes more widely available to institutional allocators and stakeholders.
The concentration of private equity backing in the US data center sector amplifies this environmental exposure. Half of the top 10 US data center owners are backed by private equity investors, and these firms have increasingly invested in natural gas and coal-fired power plants to provide reliable electricity to support data center operations. Industry observers note that this contribution to global emissions has received comparatively little public attention, in part because private markets operate with substantially less transparency than public equity markets. According to research from the Private Equity Stakeholder Project, private equity funding of fossil fuel assets has exceeded $1 trillion since 2010, with momentum continuing through 2025 as rising electricity demand and pro-investment policy environments encourage further deployment of gas-fired power generation capacity, particularly in western US regions where infrastructure is being developed to support intermittent renewable resources.
Despite managing sufficient aggregate capital to enable sector-wide transition strategies away from fossil fuels, the top 20 private equity firms have prioritized energy infrastructure investments that lock in continued reliance on natural gas and coal for the next decade or longer. The opacity of private markets and limited disclosure requirements have historically shielded private equity's energy investments from the regulatory and reputational pressures increasingly facing publicly traded energy companies, though this landscape appears to be shifting as research documenting the sector's climate impact becomes more widely available to institutional allocators and stakeholders.
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